Indicadores no processo de S&OP: Quais usar?

What indicators should I use in my S&OP process? Hi everyone, my name is Diego de Souza and I'm managing partner here at Plannera and this is the first video in a series of short videos that we will start releasing periodically answering questions they ask us about the integrated planning process like everything else which is our specialty. So let's get to the question "which indicators should I use?

". The first thing I wanted to say is that there is no cake formula, there is no list that I can give you that I say: "look if there are these indicators on this list, your S&OP is ok, if you don't have it, it's wrong your S&OP. The truth is that the S&OP is fundamentally a decision-making process aimed at aligning some trade-offs within the business that are linked to this problem of Supply Chain planning.

And these trade-offs are different for each business. There are some businesses that will be paying more attention to the use of assets, some that will be more concerned with the level of customer service, some that will be more concerned with working capital, as is the case of the distribution business, for example. So, there isn't much of a cake formula and it doesn't work either, it's not fixed, so it could be that even if today you have a set of indicators that's right for your business for your S&OP for the today's problems, it could be that from here at 6 months and 12 months, these indicators are incomplete and you decide to use other indicators to better reflect the decisions you are making.

But, in order not to leave you unanswered, in practice, every good planning process has to have at least one indicator in one of the four categories I'm going to talk about. The first category is the Uncertainty category, that is, it tries to measure our ability to predict the future, generally speaking of demand planning. So how well can we look at three months, 5 months, 12 months from now and know what will happen to our demand, for example.

Indicators that fall into this category are Forecast Accuracy, which is the most common, WMAPE, which is the complementary cousin of Forecast Accuracy, the BIAS that tells us where we are going wrong, is the bias, right, and some others that come with it too. The second category is the customer service category , service level, it tries to measure how well we are serving those who pay our bills, which is the customer at the end. Here within this category are indicators such as OTIF, backlog, lost sales, stockouts.

Everything that happens when a customer wants our products and we don't have the product there in the right place at the right time to meet that demand. The third category is the category of excess costs, it is the category that usually includes inventory costs, how much Capital we have inventory, what is our inventory coverage , how is the health of our inventories, the slow movings, the low ones cute right, the no-movings, those who are stranded and will soon be scrapped or will have to be destroyed somehow. And it tries to measure while the service level measures what happens when we, someone wants it in the products and it's not there, it's access, it tries to measure what happens when our product is there but nobody wants it, and finally the fourth The broadest category of all is Supply Chain Efficiency.

It's a little bit, I call it the cost of the rush, ok I imagine, next we made mistakes we tried to plan and send it to the future and we saw there in our technical support that the focus And then there was a lot of sepia and we look at the level of service and it was high I mean that one, sure, this error we had was not paid by the bill by the customer, so it didn't run out cool so did he have stock here, that's not why it wasn't missing if we were chubby. and it turned out there's no shortage in the product, we look at the stock indicators and say damn no, we're inside the coverage we used, it's cool so, as we had a big error in demand, it continues to maintain the service level but there was no stock for fat, they don't have stock to pay for attitude and this last category she explains the rest she explains the rush she explains what probably happens in this situation which was we made a mistake the demand the customer we didn't want to If you're missing, I'm not here and we ran out to meet you, that's where Air freight comes in, emergency transfers between DCs, extra production shifts, unplanned setups, all the inefficiencies that we impose on the Supply Chain when we try to step on the accelerator beyond what the Supply Chain was sized to handle. So, again, there is no cake formula, but if you have at least one indicator in these four categories, you are not missing any of the main trade-offs involved in tactical supply chain planning .

Guys, if you liked this video I would like you to collaborate with us. We don't want to answer questions alone, so please leave your question here in the comments of this video and we will answer them over time, ok. Another thing I wanted to ask you was that you follow our LinkedIn page which is where we will post the videos and so you see your answers coming in video form in the future and finally if you are very interested in tactical planning we have a very nice newsletter which is where we curate our blog content and you will receive it monthly.

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Thanks guys! Until next time!