Best of the Best S

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Best of the BestSOP Conference
First General Session SALES OPERATIONS
PLANNING STRUCTURE, PROCESS, BENEFITS Panelists
Amy Mansfield Joe Shedlawski
Terry Finnegan
Presenter/Moderator Tom Wallace
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• Amy Mansfield
• VM STAR
• Production Planning Manager

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VM STARVallourec Mannesmann Tubes

• North America's leading producer of seamless
  casing
• Annual Capacity 500,000 metric tons finished
  product
• 1st Executive SOP Meeting, January 2006
• Certifications API 5CT, API 5L, OSHAS 18001,
  ISO 9001, ISO 14001

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Products and Customers

• Oil Country Tubular Goods, Line and Standard
  Pipe, Coupling Stock and Mechanical Tube
• 100 Make-to-Order
• Sales Channels 100 Distribution
• Key End Users Devon, Exxonmobil, Chesapeake,
  Applied Drilling, El Paso

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Joe Shedlawski, CPIM

• Wyeth Consumer Healthcare
• Principal, Commercial Operations
• Past President of APICS (2007)

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Wyeth Consumer Healthcare

• Headquartered in Madison, NJ
• Global marketer and manufacturer of
  over-the-counter health care products-analgesics,
  nutritionals, respiratory, topicals
• 2.7 Billion global sales
• First Sales and Operations Planning
  implementation-1992-Lederle Consumer
  Healthcare-led by Joe Shedlawski
• One of the worlds top 5 consumer healthcare
  companies with several top market share brands

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Products and Customers

• Major Products Advil, Alavert, Caltrate,
  Centrum, Chapstick, Dimetapp, Robitussin
• 70 Make-to-Stock
• 30 Promotional Pack or Custom Display
• Key Customers
  
  Wal-mart, Walgreens,CVS, Costco, Target, Rite
  Aid, Kroger
• (Sales Channel Distribution Centers

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Terry Finnegan ImagePoint Senior Business
Manager
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ImagePoint

• Largest provider of retail exterior image
  products and services
• Headquarters in Knoxville, TN
• Production facilities in Florence, KY and
  Columbia, SC
• 200M in annual sales
• Started ESOP May 2007

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Products and Customers

• Products signs, lettersets, electronic message
  centers, building elements, fascia systems,
  menuboards
• Services surveys, installation, maintenance,
  project management, conceptual art, and
  engineering
• 100 Make-to-Order
• Key customers McDonalds, GM, Honda, Nissan,
  Ford, Chrysler, Lexus, Chase, Wachovia, Wells
  Fargo, Rite Aid, Fed. Express, Sunoco
• Sales channels direct to Corporate clients

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The Four Fundamentals

• How Much?
• Rates
• The Big Picture
• Product Families
• Strategy/Policy/Risk
• Monthly/18 Months
• Top Management

• Which Ones?
• Timing/Sequence
• The Details
• Individual Products,
• SKUS, Customer Orders
• Tactics/Execution
• Weekly/Daily 1-3 Mos
• Middle Management

Mix
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The Old Terminology
Sales Operations Planning
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
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Sales Operations Planning
Morphed Terminology
Sales Operations Planning
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
Master Scheduling Supplier and Plant
Scheduling Distribution Scheduling
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Sales Operations Planning
Morphed Terminology
Sales Operations Planning
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
Master Scheduling Supplier and Plant
Scheduling Distribution Scheduling
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Sales Operations Planning
Morphed Terminology
Sales Operations Planning
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
Master Scheduling Supplier and Plant
Scheduling Distribution Scheduling
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Sales Operations Planning
Sales Operations Planning
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
Master Scheduling Supplier and Plant
Scheduling Distribution Scheduling
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Sales Operations PlanningNew Terminology
????????
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
Master Scheduling Supplier and Plant
Scheduling Distribution Scheduling
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Sales Operations PlanningNew Terminology
Executive SOP
Volume
Supply (Capacity) Planning
Demand
Supply
Demand Planning/ Forecasting
Mix
Master Scheduling Supplier and Plant
Scheduling Distribution Scheduling
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The 5-Step Executive SOP Process
Decisions Updated Game Plan
Step 5 Exec Meeting
Step 4 Pre- Meeting
Step 3 Supply Planning
Step 2 Demand Planning
Step 1 Data Gathering
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Conference Pointer

• The Five-Step Process
• Dean Smetana, VP, Sanford/Sharpie
• Bill Zimmerman, Manager, Sanford/Sharpie
• 1000 Thursday Level I

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The 5-Step Executive SOP Process
Step 2 Demand Planning
Step 1 Data Gathering
Actual Demand, Supply, Inventory, Backlog
Statistical Forecasts and Worksheets
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Conference Pointer

• Forecasting and
• Demand Planning
• Scott Harrison, VP, Valor Brands
• 1110 Thursday Level I

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Conference Pointer

• The Demand Management Game
• Robert Burrows, Principal, On-Point Group
• 945 Friday Level I
• (double session)

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The 5-Step Executive SOP Process
Step 3 Supply Planning
Resource Requirements PlanCapacity
Constraints 2nd-pass spreadsheets
Step 2 Demand Planning
Step 1 Data Gathering
Actual Demand, Supply, Inventory, Backlog
Statistical Forecasts and Worksheets
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Conference Pointer

• Supply Planning
• Joe Shedlawski, Principal, Wyeth
• 215 Thursday Level I

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The 5-Step Executive SOP Process
Decisions Updated Game Plan
Step 5 Exec Meeting
Step 4 Pre- Meeting
Step 3 Supply Planning
Resource Requirements PlanCapacity
Constraints 2nd-pass spreadsheets
Step 2 Demand Planning
Step 1 Data Gathering
Actual Demand, Supply, Inventory, Backlog
Statistical Forecasts and Worksheets
End of Month
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Conference Pointer

• How to Conduct the
• Pre-Meeting and Exec Meeting
• Brian Harlan, Director
• Johnsonville Sausage
• 345 Thursday Level I

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Conference Pointer

• Obtaining Top Management
• Commitment and Participation
• Terry Finnegan, Senior Business Manager
• ImagePoint
• 1000 Thursday Level II

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Conference Pointer

• Resolving Conflict and
• Building Consensus
• John Gallucci, Director, Gerber
• 1110 Thursday Level II

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The 5-Step Executive SOP Process
Decisions Updated Game Plan
Step 5 Exec Meeting
Step 4 Pre- Meeting
Step 3 Supply Planning
Resource Requirements PlanCapacity
Constraints 2nd-pass spreadsheets
Step 2 Demand Planning
Step 1 Data Gathering
Actual Demand, Supply, Inventory, Backlog
Statistical Forecasts and Worksheets
End of Month
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Question for Panelists

• Your Process
• Same?
• Different?
• Hardest Part?

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Executive SOP . . .

• Is an executive decision-making process
• Balances demand and supply
• Deals with volume in both units and
• Ties operational plans to financial plans one
  set of numbers

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Conference Pointer

• Working with One Set of Numbers
• Amy Mansfield, Manager, VM Star
• Melissa Takas, Financial Analyst, VM Star
• 345 Thursday Level II

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Executive SOP . . .

• Is an executive decision-making process
• Balances demand and supply
• Deals with volume in both units and
• Ties operational plans to financial plans one
  set of numbers
• Is the forum for setting relevant strategy and
  policy regarding demand and supply

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Question for Panelists

• What role does Top Management play in this
  process at your company?

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Hard Benefits

• Customer Service UP
• Plant Productivity UP
• Inventory DOWN
• Obsolescence DOWN
• Freight Costs DOWN
• Order Lead Times DOWN
• Supplier Lead Times DOWN
• Time to Launch New Products DOWN

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Conference Pointer

• SOP Support for
• New Product Launch
• Craig Faulkner, SOP, W. L. Gore
• 945 Friday Level II

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Soft Benefits

• Enhanced Teamwork
• Structured Communications
• Better Decisions with Less Effort and Time
• Better Plans with Less Effort and Time
• Greater Accountability
• Greater Control
• Window into the Future
• Top Managements Handle on the Business

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Question for Panelists

• Biggest Benefits Hard
• Soft

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Question for Panelists

• Implementation
• How Long?
• Costs?
• Toughest Part?

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Conference Pointer

• How to Implement SOP Successfully
• Rick Hall, VP, Homac/Thomas Betts
• Bob Stahl, President, R.A. Stahl Co
• 830 Friday Level I

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The Global Challenge

• We are a series of organizations doing business
  locally, with intense global coordination.
  Percy Barnevik
• Former CEO
• ABB
• Executive SOP should support
• these dual objectives.

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Conference Pointer

• SOP in a Global Business
• Alan L. Milliken, Manager, BASF
• 830 Friday Level II

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The Future of Executive SOP Growth Factors

• Success breeds success

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Adoption of New Processes

• There is a 15-25 year lag between the development
  of a new process and its widespread adoption.
• Examples MRPII/ERP, TQM/6SIGMA, JIT/LEAN

The word gets around.
Executive SOP Today
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The Future of Executive SOP Growth Factors

• Success breeds success
• Lean Manufacturing and SOP

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Toyota The Lean Poster Child

• At Toyota, production is
• pushed into ? Fin Goods Inv
• ( 2-3 Billion)
• In many companies, production is
• pulled by ? Customer Demand

In balancing demand and supply, many companies
have a tougher job than Toyota. Their solution
Executive SOP.
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Conference Pointer

• SOP and Lean Manufacturing
• Jeff Greer, VP, KVH Industries
• 215 Thursday Level II

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The Future of Executive SOP Growth Factors

• Success breeds success
• Lean Manufacturing and SOP
• Globalization

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The Future of Executive SOP Growth Factors

• Success breeds success
• Lean Manufacturing and SOP
• Globalization
• New users outside traditional manufacturing
• SOP specific software

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Conference Pointer

• Technology as an SOP Enabler
• Larry Lapide, Director, MIT
• 1055 Friday Level II

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The Future of Executive SOP Growth Factors

• Success breeds success
• Lean Manufacturing and SOP
• Globalization
• New users outside traditional manufacturing
• SOP specific software
• Greater financial integration, power and utility
• A highly visible presence
• in the executive suite

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My Prediction

• Over the next 10 years, Executive SOP will
  emerge as a primary tool in the Top Management
  tool kit.
• It will be widely viewed as indispensable for
  organizations needing to balance demand and
  supply in a complex, rapidly changing
  environment.
• Tom Wallace
• Chicago
• June 19, 2008

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Thanks for Listening

• To get copies of slides
• www.tfwallace.com/resources
• will be up by Monday morning