Integrated business planning in the age of the digital transformation

Strategic planning includes the business planning: determination of the network nodes to be planned (sales locations, warehouse, production plants, suppliers), financial and budget planning, strategic sourcing (internal or external) of components and production capacities, and incorporation of sales & marketing plans.

Tactical planning includes the process of the portfolio; demand, supply, and inventory planning; also called Sales, Inventory & Operations Planning (SI&OP). It consolidates all information relevant for the sales plan and, in the process of comparing demand and supply, creates a feasible plan taking into account goals defined internally (e.g. inventory level or service level).

Sales & Operations Execution describes the operative planning and includes customer order management, operative disposition, and production in the course of detailed production planning and processing. Regarded are all topics relating to customer order entry and accounting, operative material disposition and the provision of materials for production supply, as well as transport and warehouse management.

The process of Sales, Inventory & Operations Planning (SI&OP) distinguishes itself through the interplay of many specialized departments and interest groups, which are not always in one location. Of course this increases the work required for communication and agreement. In addition, many companies struggle with information and data breakdowns in their organizations and system architectures. This is frequently also the reason for a flawed SI&OP process with which nobody – not sales, the suppliers, planning or production – is satisfied. These problems result in increased material inventories, customer satisfaction, and in the end, lower product margins.

The possibilities of the digital transformation

With the new possibilities of the digital transformation, improvements and efficiency increases can be achieved in this complex processes. Precisely when it comes to communication, data availability, reporting/monitoring, and computing capacity, there are innovative tools for fundamentally optimizing the SI&OP process. With an integrated system environment, the incorporation of all stakeholders and the support of artificial intelligence (interpretation of market developments), data is communicated and potential becomes visible.

Thanks to the use of state-of-the-art digitalization technologies, the organizations and processes can be attuned sensibly to one another, total costs minimized, customer service, and the satisfaction of all process participants and customers increased.

Achieving the optimal SIOP process with an integrated planning approach

In conversation with Patrick Boucek, Head of Digital Supply Chain, SAP Deutschland SE, Fabian Stocker, Vice President S&OP at valantic explains which classic problems can occur in the planning process and how valantic resolves these planning conflicts with the valantic best practice process. He discusses how the cloud solution SAP IBP can help map and optimize customer processes and align companies’ demand and supply.

The path to the integrated planning approach

How can companies digitalize their planning? And how should companies start setting up an existing ERP system or, even better, beginning right away with the implementation of S/4HANA?
Experts Fabian Stocker, Vice President S&OP, valantic and Patrick Boucek, Head of Digital Supply Chain, SAP Deutschland SE discuss these questions.

Together with our strategic partner SAP, we are working on comprehensive solutions for innovative process and organizational requirements.
For modern processes in Sales, Inventory & Operations Planning, valantic connects the central planning software SAP IBP with various information sources such as S/4HANA (as data backbone), SAP C4/HANA (customer interface for correct demand), SAP Analytics Cloud (for the visualization and integration of the financial world), SAP Logistics Business Network (for provision of operative material transactions), and SAP Ariba (incorporation of the supplier network).

This way, it can be assured that the “optimal” SI&OP process is always integrated, and even with increasing complexity, the technical possibilities are exploited and industry-specific special solutions developed.

State-of-the-art purchasing processes with SAP Ariba

valantic’s integrated planning approach combined with the strategic partner SAP offers new possibilities for incorporating planning-relevant network information.

Supply chain collaboration with SAP IBP and SAP Ariba

Why does it make sense to integrate the supplier network into planning processes, and how can the combination of SAP Ariba and SAP IBP strengthen the planning process?
Our experts Claudius Rieger, Senior Consultant at valantic and Falco Feldchen, SAP Intelligent Spend Management, SAP Deutschland SE, answer these and more questions.

thyssenkrupp Materials Processing Europe GmbH of Krefeld, Germany, acts as a processing specialist for steel and aluminum, among other things also as supplier to the automobile industry. It is therefore subject to huge fluctuations in demand and great price and competitive pressure. To increase potential efficiency, with the help of valantic, the company implemented the cloud solution SAP IBP for integrated, partially automated sales, purchasing, and disposition planning. This was an exciting project in many respects.

Read complete thyssenkrupp case study