Improving Alignment Between Supply and Demand Through the Analysis of An Asian Model of Sales and Operations Planning (S;OP)

Abstract

Sales and operations planning (S&OP) is considered as an important tool at the planning strategic level. Its models vary depending on industries. The Asian model is known to be very developed. Having several parameters, the Asian model proves to be an effective tool, precisely for the study of capacity. However, after several searches made in various databases, we did not find any concrete model actually used in industry and whose parameters are presented and which defines the analysis logic to better align supply and demand. In this article, we will carry out various simulations on the basis of the data of a model of sales and operations planning used in a wire harnesses factory, in order to explain the decision-making process during S&OP meetings. The parameters of the model and the various constraints that were facing the sales and operations planning team are presented and discussed as well as the financial consequences of certain decisions. As a result of this study, we can notice that S&OP is indeed a powerful tool that makes it possible to detect in advance the various constraints whose resolution concludes in an optimal alignment between customer demand and factory capacity.

Keywords

• sales and operation plan
• decision-making
• simulation
• alignment
• supply
• demand