How much project management is necessary for your S&OP process?

Nick Verstraete
Nov 29, 2018 6:37:18 PM

The functional scope of a project is not the sole determining factor for the level of follow-up that a project requires. There’s actually a straightforward rule that can be applied: the more complex a project is, the greater the need for project management. So, when you are considering the project management role for your S&OP trajectory, take into account the following complexity drivers: organizational structure, the IT-landscape, volumetry and maturity.

  1. Organizational structure: this is by far the most important complexity driver. Is your supply chain organization centralized or does every country have its own process? Or even better formulated: do you have a Supply Chain Manager who’s managing a central supply chain team that is setting the chalk lines for the entire organization? Or are there marked differences between the regions who are only reporting to the Supply Chain Manager? The latter will require much more coordination, since you will need the agreement of all the regions on the proposed S&OP template. The more the regions are working as individual operating companies, the more challenging the project management will be.
  2. The IT landscape: do you have a lot of Enterprise Resource Planning (ERP) systems? Are there ERP systems from different vendors? Well, in that case, coordinating and following up the consolidation of data extracts across ERP instances, will require a significant time investment. One single ERP backbone (while very costly to achieve as an organisation) is definitely an advantage when rolling out S&OP software.
  3. Volumetry: or the combination of data size and number of users. It is only logical that a project with 1.000 impacted users and more than 3.000.000 million planning combinations will be more difficult to manage than a project with 100 impacted users and 500 planning combinations. Typically, there is a difference too between the sectors. Automotive aftermarket industries & distribution-oriented industries have a high data volumetry, while Food & Beverage, for example, is noted for its relatively low data volumetry.
  4. Maturity: not every organization has the same S&OP maturity level. According to Gartner, there are four maturity levels: operational-focused S&OP, planning-focused S&OP, profit-focused S&OP and value-driven S&OP. The more mature an organization, the more specific the expectations will be. And the clearer the expectations, the more smoothly the project management usually goes.

Recognize craftsmanship

Project management as a job is often underestimated. A project manager coordinates people, communicates objectives, allocates resources and monitors processes, but a lot of his or her work is perceived as obvious and even part of a lot of other functions. More than once it has happened to me that customers pushed one of their planners forward to also do the project management. However, planners take actions from their own perspective, without paying enough attention to the bigger picture. Think, for example, about the typical tension field between Sales and Operations. How can both parties grow towards each other? It’s not in the job description of a planner to be able to solve this bottleneck. Stakeholder management, progress assurance , issue management and conflict resolution are terms that you simply won't find in a job vacancy for a planner.

A joint commitment

Actually, we at Solventure, dare to say that we will not work with the customer if no solid internal project manager is appointed. For an external project manager, it’s impossible to intervene in the internal agenda of stakeholders and a project sponsor has usually no time to do so. The project sponsor therefore needs the support of an internal project manager, who’s also able to commit on timing, budget and tracking the progress of the project. And besides, by having someone who focuses on steering the project, the other people on the project team can fully focus on the functional implementation.

I experience daily, in practice, that the better the client internally arranges the project management, the easier, faster and more qualitatively we can deliver an S&OP project. I find it quite striking that it is still not generally accepted that you need experts for project management. So, my 50 cents: if you are serious about investing in S&OP, take the project management seriously as well.

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