Many supply chain leaders think of S&OE as yet another system to be acquired or patched on to S&OP. Although this maybe a viable strategy but not a particularly efficient one.
Sales and Operations Planning (S&OP)
Most supply chain practitioners believe that there is a need for a rough long term planning engine (S&OP) and yet another for plan execution (S&OE).
I find it interesting that most companies choose their supply chain planning vendor based on how nice it looks but pay very little attention as to how good the quality of plans are. Not all planning systems are created equal.
Having S&OP and S&OE as two separate systems does not make sense, it is redundant and costly. Having two systems implies two disjoint systems that do not understand each other’s data model.
With most S&OP solutions, since you are running long-term plans, reliability and mission critical importance of the plans generated may not matter
S&OE is closer to execution but it is also more accurate version of S&OP. It is actually a digital twin of the physical supply form.
Why, because S&OE has a more accurate model of the world & can figure out all the alternatives and make a quick and optimal decision that can be followed.
The concept of supply chain digital twin has become very popular in recent years. It is essentially a digital model of your supply chain intended to be the foundation for companies to plan and operate their supply chain digitally and autonomously.
Many companies have or are in process of implementing S&OP solutions aiming to digitalize their supply chains. S&OP is essentially a high level rough cut and long-term model of the supply chain.
