Certification programs like those offered by IBF are becoming more and more attractive to supply and demand planning professionals. At a time when artificial intelligence makes it possible for employees to fake it until they make it until they get called out for it, certification proves that you’re the real thing.

IBF’s certification programs offer targeted training and education that help bridge knowledge gaps, develop new competencies, and align professionals with the latest supply and demand planning industry standards.

The Difference Between a Degree and Certification

Let’s start by explaining the difference between degree and certification programs.

Advanced education, which results in a degree or diploma, requires years of study. As a degree student, you attend general education classes in major- and minor-specific subjects.

By contrast, obtaining a certificate results from finishing the required coursework in a defined part of supply and demand planning. The studying you do to get a certificate is typically not general; instead, it is explicitly tailored to the specific area of study. Mastery is demonstrated by passing a test.

Earning an IBF certificate requires far less time than earning a degree. Despite this, you come away with in-depth knowledge.

Often, after completing degree programs, graduates pursue certifications when they want to advance in their careers or develop new interests. (Think moving from a warehouse supervisor position into demand planning.) This prevents people from having to start from scratch with a new degree when they want to make a change and allows them to improve their skill set and build on their education.

10 Reasons to Pursue IBF Certification

Here are the top reasons people earn certification from the Institute of Business Forecasting.

1. Improve skills

IBF’s certificate programs provide targeted education about various aspects of supply and demand planning. They offer a focused curriculum that allows you to deepen your knowledge and develop specialized skills relevant to the field. Our experts can help you gain expertise in a high-demand area. It signals employers, managers, and peers that you know your stuff.

2. Advance your career

Earning an IBF certification can improve growth and career advancement opportunities within your organization. It helps demonstrate a commitment to ongoing learning and professional development that will position you above your peers. Supply and demand planning certification shows that you are dedicated to advancing in your career in the field, which makes you a valuable asset. With certifications, you will likely qualify for promotions, salary increases, or access to more challenging roles within your company.

Be aware: Certification can significantly increase salary. Many studies show it can add up to thousands of dollars a year.

3. Stay up-to-date with industry trends

New supply-and-demand-planning technologies, methodologies, and best practices emerge constantly, and the pace of change has only increased with the advent of artificial intelligence. Like many other business areas, supply and demand planning increasingly relies on advanced technologies to improve efficiency, the customer experience, and business performance. IBF’s certification programs help supply and demand professionals stay on top of the latest technological advancements and methodologies, ensuring they are not left behind in the rapidly evolving landscape.

4. Networking opportunities

Enrolling in an IBF certification program while taking part in other learning opportunities we offer is an excellent way to expand your professional network. Imagine being able to ask industry experts and peers questions and get trade secrets that give you an edge. You can also share war stories from work during these changing and challenging times.

You will have the chance to connect with instructors, industry experts, and fellow participants who share your passion for supply and demand planning. Networking often results in valuable new industry connections, mentorship opportunities, and even job offers.

5. Improve problem-solving skills

IBF’s certification programs include case studies, simulations, and real-world scenarios that help participants learn new thinking methods. They require professionals to apply their knowledge and skills to solve problems. Through the exercises, you develop critical thinking and problem-solving abilities, which allow you to address challenges more quickly and effectively at work. It will help you to stand head and shoulders above your peers with lesser problem-solving abilities.

6. Global recognition and mobility

IBF’s certifications are recognized across the world. This makes it possible for you to pursue job opportunities beyond your local area. It is a way to prove your supply and demand planning expertise in the United States, Europe, or anywhere else. IBF professionals are known for meeting a high level of competence and enhancing trust and consistency across different regions and industries.

7. Meeting business goals and objectives

Companies have specific goals and objectives requiring a skilled and knowledgeable workforce. IBF stays closely connected to supply and demand planning experts at leading companies. This helps ensure our certification programs align with the current strategic needs of leading firms. Being certified makes it clear to companies that you are capable of helping them reach their business goals.

8. Continuous learning and personal growth

Certification does not just benefit career progress and business performance. The ongoing learning associated with certification results in personal growth and satisfaction. A focus on improvement encourages people to reflect on their values, beliefs, strengths, and weaknesses. Through self-awareness, they gain a deeper understanding of themselves, their motivations, and their goals, enabling them to make better-informed decisions and lead more fulfilling lives.

Taken together, this builds confidence, which is a reward in itself.

9. Job security and resilience

Relevant IBF certifications will improve your job security and ability to recover from setbacks. Certified professionals are in high demand, especially in industries experiencing rapid technological advancements or the impacts of tariffs.

IB’s certification programs typically cover a broad range of topics, allowing you to improve your skills in a wide array of areas. By investing in your education and acquiring certification through IBF, you can future-proof your career and increase your employability over the long term.

10. Credibility. Credibility. Credibility.

Of course, other training and certification programs are available, especially online. However, IBF’s is different. Our certification program has been around for decades and is the most respected in the industry. If you invest in personal or business-level certification, it will pay off many times over. Plus, you and your business enter an exclusive club that only a small fraction of the industry is a part of.

The Final Word on IBF Certifications

In conclusion, IBF’s individual and group certificate programs provide targeted, specialized supply and demand training that improves skills, increases knowledge, and supports career advancement across industries. It will make you more valuable to your current company and to other businesses.

Earning certification boosts self-confidence and provides a sense of personal satisfaction. Of course, studying for and passing rigorous certification exams is challenging and requires dedication, effort, and perseverance. Successfully earning certification validates your hard work and expertise. People who earn their certification through IBF are quick to claim and promote their status.

The sense of accomplishment that comes with getting certified can inspire you to set and achieve even greater career goals.

Plus, at a time when too many people are using artificial intelligence to fake it until they make it… or fail, IBF certification proves you are the real thing.

Are you ready to earn your IBF certification? Would you like to get your team certified? Find out more.

Are you interested in a challenging career that will put you in an influential position at work and provide significant career growth potential?

Then, working in demand planning might be an excellent option for you.

Demand planners are crucial in forecasting future demand, optimizing inventory, and improving overall business efficiency. The field provides opportunities for cross-functional collaboration, exposure to diverse business areas, and the chance to significantly impact a company’s profitability. In addition, it plays a critical role in consumer satisfaction. Demand planning is a growing field offering career opportunities, limitless learning potential, and the opportunity to work in many industries.

Individuals who want to become demand planners must be interested in data tracking and analysis, understanding consumer behavior, and anticipating market trends. That’s because their ultimate purpose is to help businesses meet consumer demand efficiently.

If you choose a demand planning career, be prepared to develop a specific skill set, gain relevant experience, and continuously adapt to the ever-evolving world of supply chain and demand planning, where change is only accelerating with the introduction of AI.

This guide explains everything you must know to become a successful demand planning professional.

Education Requirements for Demand Planners

The first step in becoming a demand planner is to meet the necessary educational requirements.

A bachelor’s degree in supply chain management, business, statistics, economics, or a related field is typically required. Plan to take courses in data analysis, supply chain principles, and inventory management. Beyond that, consider pursuing a master’s degree or certifications like those offered by the Institute of Business Forecasting, which can help you stand out.

Analytical and Technical Skills Demand Planners Need

Demand planning is all about data analysis and forecasting. Develop your analytical skills by learning to interpret complex data sets and identify trends. Gain expertise with statistical software and tools. Start with Excel and then build up to more advanced ones such as SAS and R. Demonstrate your systems proficiency by mastering enterprise resource planning (ERP) systems and demand planning software. These are crucial for developing accurate demand forecasts and effective supply chain strategies.

Soft Skills for Demand Planners

One of the career-enhancing opportunities that demand planning offers is the opportunity to work with so many cross-functional partners. Many demand planners cite this as why they were offered advancement opportunities quicker than their peers.

Because demand planners must handle many types of tasks and work with a wide array of stakeholders, they will be more successful if they develop specific soft skills, including:

• Communication: Demand planners should be able to clearly communicate complex concepts to different stakeholders, including people in sales, marketing, finance, operations, and company leadership. This includes not just explaining the what behind forecasts but also the why.
• Collaboration: Demand planning often requires collaboration across many departments and functions. Getting everyone in a room to agree is a skill in and of itself. It’s easier to do this with solid collaborative capabilities, supporting partnering with other teams, information sharing, and working together to achieve common goals.
• Adaptability: Many factors, including market changes and unexpected events, can impact planning. Demand planners must be flexible and adaptable enough to adjust forecasts and plans in real-time.
• Problem-solving: Supply chains are becoming ever more complex. Consumers seem to change their minds more than ever. As a result, planners will frequently encounter challenges and uncertainties during their workday. Solid problem-resolution skills are necessary to identify and resolve potential issues, such as forecasting mistakes, data errors, or supply chain disruptions.
• Continuous improvement: Demand planning changes rapidly, even more so since the introduction of artificial intelligence. Planners must stay up-to-date on the latest trends and best practices in the field.
• Leadership: Leadership doesn’t only refer to managing other people; it comes in many forms. Demand planners must inspire other teams and stakeholders to achieve common goals, which requires the ability to both listen and influence others to drive a consensus among the team.
• Attention to detail: In demand planning, little things make a big difference. Attention to detail is key for success. Identifying small issues can save a company millions of dollars in inventory reductions and increased efficiency.
• Organization: Demand planning is all about juggling many plates at once. People with differing priorities will pull you in many directions. Planners must be capable of prioritizing their work and staying organized and structured in their approach to data analysis, forecasting, planning, and working with others.
• Time management: Planning is time-bound. That’s why demand planners must master time management and set priorities.

Experience Needed for Demand Planning Roles

Hands-on experience is incredibly valuable for understanding the complexities of demand planning and handling challenging situations.

Start by looking for internships or entry-level inventory management, procurement, or logistics positions. Larger organizations offer rotational programs for new grads that can provide excellent exposure to the various parts of the supply chain. This will help you learn the factors that influence demand and how supply chains operate. Aim to participate in cross-functional projects to find out how different departments influence supply and demand planning.

Build a Professional Network

No demand planning professional achieves success on their own.

Start by seeking out internal mentors. Look for people in roles you may aspire to one day and ask for their guidance.

Both internally and externally, networking and building connections are essential.

Join professional organizations like the Institute of Business Forecasting to connect with peers and industry experts and continue your education. Attend conferences, workshops, seminars, boot camps, town halls, and other events to stay on top of industry trends and best practices. (These are also great places to seek out external mentors.)

Networking can help you broaden your industry knowledge and open doors to career opportunities. People love to help others; you just have to ask.

Show Off Your Demand Planning Work

As you gain demand planning work experience, develop a portfolio that showcases your projects and achievements. (Consider building a website you can link to from your LinkedIn profile or share with prospective employers.) Include case studies, forecasts, testimonials, and strategies. Document how your work resulted in business improvements and efficiencies and helped prevent supply issues.

This is also a great time to start giving back. It is said that there is no better way to master a subject than by figuring out how to teach it. Write an article for a publication like the Journal of Business Forecasting. Present what you have learned or a case study at a conference.

Keep Learning and Stay Informed

Demand planning is dynamic, with methodologies and technologies constantly emerging. Introducing artificial intelligence into the practice has only accelerated the pace of change.

Too many people sit back and expect others to establish their ongoing development plan, only to be frustrated when they realize they are being left behind. Take ownership of your career development. Stay informed about the latest trends in supply chain management, data analytics, and demand planning. Engage in continuous learning through online courses, webinars, and publications like those offered by IBF. Participate in local industry networking meetings. Keeping your skills and knowledge current is critical for advancing your demand planning career.

Taking these steps is the traditional way to achieve success in demand planning.

Other Paths To Get Into Demand Planning

Not everyone follows the traditional path into a career in demand planning. Think of all of the inputs that go into creating a solid forecast. With the right analytical skills, cross-functional partners who understand what goes into a demand consensus process can become great demand planners. Some alternatives include:

Move into Demand Planning from Customer Service or Sales

People who work in customer service or sales positions have valuable insights about consumer behavior and market trends that can benefit demand planning.

Moving from these areas into demand planning is a relatively common career trajectory. People who do this have a solid understanding of product demand and customer needs. To become effective demand planners, they must develop analytical skills and familiarity with demand forecasting tools.

Shift from Analytical Roles into Demand Planning

Professionals with analytical experience in industries like finance, marketing, or healthcare often find these skills transferable to demand planning roles. Because they can interpret data and identify patterns, they usually become valuable members of demand planning teams. Once they learn supply chain dynamics, inventory management, and effective soft skills, they can leverage their analytical expertise in a new way, making demand planning richer through cross-industry insights.

Transfer from Inventory or Logistics Positions

People already working within or adjacent to the supply chain, such as those in inventory or logistics jobs, have a basic understanding of the flow of goods and the issues impacting it. In the end, their lives have been made easier or harder by, among other things, a good forecast. Moving up to a demand planning position is often a positive career move.

Before making the shift, candidates must expand their skills to include demand forecasting while also developing a broader perspective of the supply chain. Training like that offered by IBF will be critical to ramping up quickly.

The alternative paths people can take into demand planning positions demonstrate how expansive the field is. Building an effective demand planning team requires many people with different skill sets. There is no single way to become a demand planner, and based on our extensive experience with the industry, every career and path into it is unique. That’s why IBF offers so many resources to help practitioners and hopefuls achieve success.

How Long Does It Take to Become a Demand Planner?

The timeframe for becoming a demand planner varies from a few years to several, depending on your educational background and work experience. With a bachelor’s degree in supply chain management or a related business field, you might expect to spend about three years gaining relevant experience in inventory management, analytics, operations, or other associated areas before moving into demand planning.

For people who come from unrelated disciplines or do not have a college degree, it may take more time to develop the skills and industry knowledge needed to qualify for demand planner positions. Seeking opportunities to learn about market trends, forecasting, and inventory management can speed the process.

Becoming a Demand Planner: The Final Word

While there is no single path to becoming a demand planning professional, there are a few things people need to succeed in the field.

• Expertise in data analysis. Demand planners must be solid at interpreting data. It’s the only way to forecast demand accurately. They must constantly improve their analytical skills and master specialized forecasting software. Understanding historical trends and predictive modeling is critical for achieving success.
• Understanding of supply chain dynamics. It’s critical to know how supply chains function. Understanding how the inputs into the forecast impact its accuracy, and how your forecast accuracy impacts others downstream, is the true demonstration of your understanding of the demand planner role. Learn about the complete process, from procurement to distribution, especially the effect that demand planning can have on each stage.
• Communication and negotiation skills. No demand planner works in a vacuum. It requires building solid relationships with many stakeholders and ongoing coordination with internal teams, suppliers, and manufacturers. Every team is managing to different metrics. Many speak the language of their function (i.e., dollars vs. units). Learn how to communicate and negotiate effectively to ensure operational efficiency and cost-effectiveness.
• Focus on leanness and efficiency. Become familiar with lean and agile management practices, which are how companies operate to improve efficiency and reduce waste.
• Master project management. Supply and demand planning is project-driven. That is why understanding the fundamentals of project management is beneficial. Learn how to plan, execute, and monitor projects while limiting risk. This will help you manage initiatives successfully.
• Be adaptable. Demand planners must be able to adapt to change and solve problems. Pay attention to what’s going on in the world around you. Practice resilience by exposing yourself to different demand planning scenarios, such as market shifts or supply disruptions. This adaptability will help you feel confident that you can handle any situation, even in challenging times.
• Find a mentor. Partnering with a trusted and experienced professional is a great way to gain fresh insights and perspectives. Stay on the lookout for mentorship opportunities, and don’t be bashful about asking for support, either from senior demand planning leaders or others in the organization. The worst they can say is no, but most will want to help or will be willing to refer you to a colleague better suited to supporting your goals.

These tips will equip aspiring demand planners with the skills and knowledge to transition successfully into a new position and help people already in the field advance their careers.

Get a jump start by taking advantage of all the resources available through IBF, including our training and networking opportunities, journal, podcasts, and more.

And for students, and others just starting out, IBF offers free events including webinars and regional events. You can also volunteer to help out at IBF conferences and events and receive free admission. Contact IBF to find out more.

 Many companies strive to build, enhance, and protect their culture for a variety of reasons. Through corporate culture, companies provide an experience to their internal and external stakeholders that impacts the longevity of those multi-directional relationships. These relationships carry a premium value that directly impacts the bottom line.

In this article, I will describe why and how to build a data-driven culture that serves both internal and external stakeholders with a focus on the supply chain.

What is Culture?

One of the most comprehensive definitions I have encountered was provided by Dr. Norman Doidge in his book The Brain That Changes Itself, stating that “Culture is not just produced by the brain; it is also by definition a series of experience that shape the mind…we become “cultured” through training in activities such as customs, arts, ways of interacting with people and the use of technologies and the learning of beliefs and shared philosophies and religion.”

One’s identity is difficult to contain as we evolve, experience, and learn. This makes Dr. Doidge’s definition for the concept of culture appealing. We can all be on a self-correcting path by evaluating our experiences and their resulting takeaways. Although this broadly pertains to an individual’s own domain, the corporate world has a responsibility to improve the quality of the experience that their employees can ‘life’. These experiences might slowly but surely impact their weltanschauung [world view], and directly impact how employees evaluate and respond to what is around them. This is engrained in companies that have a well-defined culture.

“The starting point is identifying the mission statement – defining the purpose of the organization and how it serves its customers.”

As more and more companies mature in their culture, that responsibility grows to have an impact both internally and externally. The starting point of, course, is identifying the mission statement – defining the purpose of the organization and how it intends to serve its customers.

Internal Impact of Corporate Culture

Similar to how people become cultured in society as a whole, employees can build, embrace and enhance the corporate culture. The more serene and positive the culture, the higher the positive impact on the bottom-line. This is mainly driven by enhanced productivity through employees’ willingness to go the extra mile and adapt their efforts to support companies in dire times.

Additionally, higher employee retention rates have a direct correlation with minimizing additional costs. Based on stats shared by recruitment site www.indeed.com, hiring a new employee for most companies ranges between $4,000 and $20,000 – excluding salary and benefits.

Just some of the many external costs include advertising and marketing expenses, background checks and eligibility to work expenses, drug testing expenses, employee referral payments, and relocation costs. There are, however, additional costs that are harder to identify such as the time existing employees spend training the new hire and as a I see it, a “calibration” cost that is associated with transitioning a specific duty to a new employee while minimizing the risk of errors as part of the learning curve.

External Impact of Corporate Culture

When a positive culture is established, it is visible to the external stakeholders through employees’ interactions as well as the company’s overall reputation. The market positioning from the direct interaction between the clients and employees can be a competitive advantage that no one else can replicate.

The quality of service that the customer facing teams provide is a direct reflection of the quality of service the support teams behind the scene present as well. Culture is at the heart of all interactions.

While culture can positivity maximize the top line through repeat business from satisfied customers and converting new opportunities thanks to a positive reputation in the marketplace, it can also enhance the bottom line through cost reduction resulting from employee retention.

Key Characteristics of a Data-Driven Culture

There are few major characteristics of data driven cultures:

Objectivity

When internal teams are aligned on the importance of the data, it helps foster a safety zone in which to openly debate different points of view. This helps gain alignment without necessarily having to reach full consensus. This is where decision makers must look beyond their own interests while accepting that the best, data driven decisions win. Amongst many other things, objectivity means:

1.) Making decisions with the quality of the final product or service in mind beyond what is easy or convenient. The best opportunity I had to witness this approach was in the CDMO industry (Contract Drug Manufacturing Organization) and in the medical devices industry. The quality and availability of an end product that would help save a patient’s life – whether it was a drug or emergency medical device – would override any other consideration.

2.) Making decisions while accounting for both the current state of the P&L and the impact on future profitability. The best opportunity I had to witness this approach in action was in a global leading performance fabric company that is family owned. Critical decisions in that organization are never made without accounting for the potential long term impact on the future generations of the family.

Trust and Humility

Trust is a prerequisite to humility. The best way to build trust is through aligning on facts, and the best way to align on facts is through data. Where there is a healthy culture, employees across the hierarchy of the organization welcome constructive debate, have the humility to seek advice and feedback, and admit mistakes.

The major advantage that data driven cultures have lies in the ability to self-correct and apply lessons learned in transformation and agility journeys. This creates a unique competitive advantage. When major change-driving decisions are made and announced with transparency, and supported by data and facts, even the most difficult decisions such as reorganizations can be supported by employees across all levels. For that to happen, the foundation of a data-driven culture needs to be established so that such transparency can be accompanied with wisdom and compassion. It is worth noting that wisdom and compassion in a healthy culture is not limited to the top down, but also from the bottom up.

The Importance Of Data Integrity

The best way to appreciate something is to realize the impact of its absence or malfunction. Poor-quality data therefore can help a company embrace a data driven culture. When there is poor data within an organization, employees always welcome data integrity enhancements.

“The best way to appreciate something is to realize the impact of its absence or malfunction.”

Accounting for the fact that there is a hierarchy of planning based on horizon, investing in data integrity should be a strategic endeavor. The reasoning behind that is simple: the longer the decision horizon, the bigger the magnitude of the negative impact that using bad data has on an organization.

Once the negative impact of using bad data is comprehended, fixing the data becomes a strategic target that gets sponsored by the senior executive team.

How Processes Can Help Build a Data Driven Culture

Once data integrity is achieved, if it is not leveraged to its fullest extent, opportunities can be missed. The philosophical question posed by Dr. George Berkeley, an Anglican Bishop and philosopher in the 1600s, comes to mind: “If a tree falls in a forest and no one is around to hear it, does it make a sound?”

To ensure that organizations benefit from available data, robust processes should be implemented. S&OP/IBP is definitely a process that leverages data to its fullest extent, bridging the gap between execution and strategy with a direct impact on the bottom line. This is done in a a variety of ways. Some of the advantages consist of proactively providing visibility to constraints through the means of scenario planning and in ensuring cross-functional alignment on the integrated forecast.

“To ensure that organizations benefit from available data, robust processes should be implemented.”

An AMR Research study indicates that more than 50% of companies that implement S&OP experience increased sales revenue, along with other benefits that impact the P&L.

In addition to nurturing the data and giving it a home in the form of a process, to get the desired results across the different decision-making horizon the process itself needs to be well defined and established. The key components in ensuring the process progresses in its maturity journey include having the right champions, participants, and cadence.

Supply Chain/Operations is the Leader in Building a Data-Driven Culture

Amongst the main planning nodes that are part of a good S&OP/IBP process, Demand Planning & Forecasting represents the key node that helps shape the identity of this unique process. Although this function can fall under any part of the organization, it is well suited to being housed within supply chain. This doesn’t mean at all that S&OP/IBP is strictly a supply chain process. As the very name of Integrated Business Planning (IBP) indicates, it is a business process necessitating the integration of all the major business plans within the organization. However, the process is best suited to this segment of the business due to the lack of bias towards the demand signals that have a concrete impact on the rest of the organization.

A survey conducted by the Institute of Business Forecasting and Planning (IBF) indicated that 50% of the surveyed organizations house the Forecasting and Planning function under Supply Chain (Operations, Logistics, Procurement).

As such, to establish a data-driven culture from the ground up, once data integrity concerns are addressed, the right process needs to be established to derive the best results from the data.

“If we want objectivity, trust, and humility at the core of a data-driven culture, what environment should we provide employees to nurture it?”

One question we should all ask ourselves as leaders is that if we want objectivity, trust, and humility at the core of a data-driven culture, what environment should we provide employees to nurture it? This is where we must be clear on how to maintain positive human interaction in serving the people entrusted to our care.

To get up to speed with the fundamentals of S&OP and IBP, join IBF for our 2- or 3-day Boot Camp in Miami, from Feb 6-8. You’ll receive training in best practices from leading experts, designed to make these processes a reality in your organization. Super Early Bird Pricing is open now. Details and registration.

I recently read Bob Stahl’s newest book, Sales and Operations Planning – An Executive Update, and I came away with a different perspective on a long-time problem; how to get consensus on a challenging forecast.  

Over the course of my long career, I have been part of, or facilitated, more than a thousand consensus meetings. And while most of these sessions generated little to no organizational tension, there have been times when it has been particularly difficult getting different parties (Sales, Marketing, Finance) to agree on a forecast. Under normal circumstances, early in the year and new product forecasts tend to cause the most tension because of the significant commercial ambitions loaded into these plans.

However, even these plans are often malleable with sufficient supporting data and conversation. The most difficult consensus challenges are always those forecasts that are most speculative, with little supporting data or with the greatest uncertainty.

Finding Consensus During Demand Chaos

COVID created forecasting chaos for many organizations. Tension increased during consensus meetings, especially during the early phases of the pandemic when, as an example, the fortunes of different product families were trending in opposite directions. Demand felt out of control.

“It was as if the pandemic froze us into inaction.”

The once-in-a-lifetime disruption confronting all of us made it hard to arrive at a forecast that everyone could agree on, despite having considerable supporting data. And for those product families for which orders and POS activity were down, arriving at consensus often seemed more difficult. No one wanted to “give-up” on the forecast so early in the year – especially given the unknown nature of consumer behavior in disruptive times. It was as if the pandemic froze us into inaction.

How I Handled Disagreements During COVID & What I’d Do Differently

When I was faced with the inability to arrive at consensus for many of the declining categories, I found myself proposing a simple approach that short-armed the forecast. I suggested looking at only at the next two to three months—acknowledging the reality of a short-term decline–while also holding the outermost forecast range to prior expectations.

We then provided a growth ramp back to the original forecast. It was a cheat of sorts. We did not “put the moose on the table” as Bob Stahl might have suggested but the short arming allowed us to move forward, effectively kicking the can down the road to the next month when better or more confirming information might be available.

While this tactic felt right in the moment, it also tossed out the window some time-honored S&OP concepts regarding managing the depth of horizon of a forecast. And while it is hard to call this approach a mistake, as we were in dark and unknown waters at the time, in hindsight it would have been better to press the issue more—to lean less on the crutch of uncertainty and rather push each member of the consensus group for their best (in this case, lowest) call.

“Start with a plan that everyone can roughly agree on, and then further challenge the assumptions.”

Instead, we did not so much collaborate on a plan; it was more like we ducked for cover. Which brings me to Bob’s book, in which he makes a pragmatic point that really resonated with me: Start with a plan that everyone can roughly agree on, and then further challenge the assumptions of that plan to get further clarity.

The ‘Greatest Common Denominator” Approach to Planning

Think of this as almost a “greatest common denominator” approach to planning. Effectively, the consensus facilitator starts by asking everyone their estimate and supporting data before trying to seek agreement. For example, in the face of double-digit declines ask, “Does everyone agree the forecast should come down for the year ?” Then follow that up by asking, “By how much, and how would you pace the decline?” By asking relatively open ended questions all voices and opinions are heard, and the range of perceived opportunities are dimensioned.

After reading Bob’s book, it became apparent to me that by putting in a short arm “device” we avoided much in the way of thoughtful conversation. We did not seek common ground. I know this because nearly everyone walked out of the consensus meeting thinking that the forecast should have been lower. We did not reach consensus – we only postponed the hard decision by four or five months when we finally made the hard calls needed to reset the forecast lower.

Some Conflict is Normal is S&OP – Embrace It

Most long-term S&OP practitioners know all too well that at least some level of tension, conflict, and disagreement are normal in consensus meetings. In fact, some disagreement within the S&OP process is to be expected and perhaps even encouraged. No one wants an S&OP plan put together via groupthink and without some rigor of organizational tension applied. Unfortunately, in the midst of COVID, we avoided this tension.

“No one wants an S&OP plan put together via groupthink.”

One of the most important lessons to come out of the COVID crisis (and Bob’s book) is to solicit more opinions and points of view as a way to put more voices into the forecasting process before trying to arrive at an agreed number. Let the opinions of the consensus team come out and bloom to see if there is a unifying or common perspective before trying to narrow the forecast. Disagreements over outcomes earlier in the pandemic would have helped avoid “chasing the forecast down” phenomena that ultimately occurred.

If history offers a lesson, avoiding tension is, well, wrong. If we believe disruption will become more common place, this is a lesson worth learning.

To get up to speed with the fundamentals of S&OP and IBP, join IBF for our 2- or 3-day Boot Camp in Miami, from Feb 6-8. You’ll receive training in best practices from leading experts, designed to make these processes a reality in your organization. Super Early Bird Pricing is open now. Details and registration.

Effective demand planning requires ongoing collaboration with many other teams. Sales, Finance, Supply and Operations — among others — depend on reliable demand planning data. Demand Planners frequently exchange data with members of these teams in order to improve forecast and sales performance.

And in many cases, members of these other teams will request specific data from the demand planning team. Salespeople want to review future forecasts; Finance wants to know about promotional plans; Supply may question a future number that seems unusually high. So, in many cases, this exchanging of information is key to the process of improving future forecasts. And since data from the demand planning team can impact many other teams’ performance, it’s important that Demand Planners collaborate effectively with these teams.

But it’s also important that the demand planning team manage the many requests they may receive in a way that doesn’t place excess strain team members. Pam in Finance hears how you created a custom report for Jan in Operations, and now Pam is asking for help with another report. Paul in Sales asked you for an updated forecast for one of his customers, and now his sales manager wants similar reports for all his salespeople. Over time Demand Planners can find themselves doing work for other departments, and in some cases these requests are valid and help to support the business. But it also easy for these requests to grow to the point where the Planners are not able to devote the time needed to provide timely and accurate forecast data.

How do we balance collaboration with other teams with preserving time for quality planning? Here are my five recommendations for keeping your planning team from being overwhelmed by outside requests — for defragging your planning process to maintain a proper balance.

1. Communicate in advance your team’s priorities so that the members of all other teams know in advance what requests are appropriate
2. Always ask if demand planning is the correct team to be handling the request
3. Always ask how a request will help improve forecast performance
4. Beware of sticky requests
5. Estimate the time required and whether the request needs to be handled immediately
6. Communicate in advance your team’s priorities so that all other teams know in advance what requests are appropriate.

In my work in demand planning, I have often found that the members of other teams are not fully aware of the purpose of my role. So when I explain to them what I do and how it impacts all the other teams involved in Supply, Finance, Operation and Sales, they may still ask for help. But in these cases, they now know that their requests need to be aligned with my central role in planning, and they are not offended when I refer them to another team for help. And I have appreciated the managers who regularly reminded all the teams that we worked with that our central role was not reporting but research and planning, and that good planning requires a clear focus and undisturbed time, and that requests that distract us from our central role hurt every one that depends on our work.

Ask if Demand Planning is the Correct Team for the Request 

People from other departments who ask a demand planner for help with information are often looking for help with issues within their own department, and may not be aware that their request is unrelated to planning. So, for example, asking a Demand Planner to research issues with past purchase order data might seem like a legitimate request to someone in Finance or Operations. However, in most cases, Demand Planners are not concerned with past orders. In addition, asking a Demand Planner to take time to do this will not help with planning future forecasts. In this case, it makes sense for the Planner to gently recommend that the requester contact a department such as Customer Service for assistance.

Ask how a Request Will Help Improve Forecast Performance

Since demand planning’s role is to provide the best possible forecasts of future performance, it makes sense for members of this team to question how requests for help from outside teams will help Planners improve forecast accuracy. A salesperson who calls for help reviewing a customer forecast can provide insights that can help the Planner with future forecasts, and collaborating here is part of the Demand Planner’s role. However, requests for help with managing purchase orders, pricing or late shipments is mostly outside the Demand Planner’s realm, and such requests need to be referred to the appropriate team.

Beware Sticky Requests

Some requests may not be directly related to demand planning, but since they are easy for Planners to handle, they help without questioning if they should do so. Where this gets them into trouble is when a single request turns into an ongoing request to provide information or reporting. I call these sticky requests. While collaboration is important, taking up a Planner’s time with ongoing requests that distracts them from their key role — providing the best possible view of future requirements — is harmful to everyone who depends on reliable forecasts. I have personally fallen into this trap, and in some cases I have had to ask my manager to inform the requester that I am no longer able to provide the requested information. A willingness to be helpful must always be balanced against managing the core demand planning responsibilities for all the teams that depend on our work.

Ask if the Request Needs to be Handled Immediately & Estimate the Time Required

When people ask for help with appropriate issues, it’s easy to assume that they need help immediately. I have learned to ask requesters when they actually need the information. Sometimes they need it immediately, but very often their need is not urgent. So, knowing when they need the information helps me manage my workload while also helping them. For my own planning purposes, I also estimate how much time and what resources I would need to allocate to each request, so I can give the requester an honest answer as to when I might have what they need. And when a request truly is urgent, take the time up front to get as much detail as possible about what the requester really wants. There’s nothing worse than dropping everything to help someone only to hear afterward that it was not what they truly needed.

The Balancing Act 

In my experience, most Demand Planners are highly skilled, they know their business, and they want to do their best to improve their forecasting skills. They know that other teams are depending on them for reliable forecasts. And it’s natural for people on these other teams to look to these talented individuals for help. The challenge is to balance collaboration and helpfulness with tactfully defending your time and focus required for truly effective planning. Defragging your demand planning processes and keeping them free of distractions is key to maintaining this balance, and allowing the demand planning talent to drive ongoing improvement.

This article first appeared in the fall 2023 issue of the Journal of Business Forecasting. To access the Journal, become an IBF member and get it delivered to your door every quarter, along with a host of memberships benefits including discounted conferences and training, exclusive workshops, and access to the entire IBF knowledge library. 

One of the most important aspects of being a successful leader is loving people leadership. You have to really enjoy it and have a passion for it. In my demand planning career I have worked in individual contributor roles but I quickly realized that my passion is really in developing and empowering people. 

The Keys to Building Effective Teams

1. The first key to building really great teams that are highly motivated and drive their own work is having a very clear mission – what are we here to do, what is our mission statement, what are we delivering year after year? It needs to go beyond just having a vision; it needs to be a defined mission statement that every business activity supports and works towards

2. Secondly it’s mastery, i.e. getting your team members to become experts in their field. As a leader, it is my job to help people learn their jobs. What I do annually with the IBF is the certification of my planners and I always budget for that year after year because that is my way of investing and developing my team members. That’s how I give them the foundational knowledge of what forecasting and S&OP should be. They all come back and say that it was such a great use of time, that they’re better informed, understand why we do what we do, and why S&OP is a critical business decision making process. [Ed: learn more about getting your team certified here.]

3. The third key is giving team members autonomy. There’s a lot of debate around coming to the office and making that mandatory. The Coca-Cola company has a flexible work-from-home program and we are completely hybrid. I have teams all over North America. We try to have physical meetings whenever we can but I give everybody complete autonomy when they come into the office. As long as they know what their individual missions are and they have the skills and the tools to complete and do their work as effectively and efficiently as possible. I find that this kind of independence helps bring the best out in people.  

It All Starts With Hiring the Right People 

The starting point to developing effective teams where individuals can be trusted to drive value independently is of course hiring good people. People make all the difference – you could have the same process, same leadership, same technology, same everything, but when you hire good people you can really take performance to the next level. 

The number one thing I look for is enthusiasm and passion for the work they do because you can’t teach that. You bring that with you as a person. I have always been so passionate about the work that I do that people always say “Oh my God Sara, you love what you do,” because I do and it shows. That passion allows me to go and try different things and learn and continue to develop myself. I want to see that in others because I know how powerful it can be.

Number two is intellectual curiosity. I want people on my team who ask, why is it like that? I want  them to say “Oh, Sara’s offering a forecasting certification program. I don’t know what that is but I want to go do that”. I want people who want to expand their knowledge and get excited when Gartner publishes this thing, or when the latest issue of the Journal of Business Forecasting is released, or when Apple News drops an article on machine learning. 

I love when people ask why the forecast looks like that, what retailers are doing, or what is happening with the consumers because that intellectual curiosity allows them to learn and improve in their roles.

It can lead them to learn things I might not know and it might be something that we can explore and take advantage of. It’s so important as a leader to adopt the attitude that I’m not the smartest person in the room. If I am then I hired all the wrong people! I don’t know everything so I need others to bring their expertise and their learning so we can be better together as a team.

 I very much lead like that and I love having my team challenge one another respectfully and challenge me and say “Sara wouldn’t it be better if we did it this way”. If it makes sense I say, yes absolutely. I tell them to go explore it and report back on what they find out and if it’s something that we need to go after, let’s figure out how we’re gonna do it.

Mentoring Helped Me Enormously – It’ll Help Your Team Members Too

Mentoring is very important in people’s career development and I’ve had many mentors in my career. Without my mentors and advisors I’m not sure if I would be where I am today. Mentors are people who can advise you but do supervise you. I have had people approach me for mentorship after hearing me speak at a Town Hall or at a conference.

When people reach out to you you can see if there’s a personal connection (i.e. beyond just professional interest). If there is, it is worth establishing a structured mentoring process. It’s my job as a mentor to schedule time for and provide a framework whereby there is an objective for the mentee, with actions or follow-ups that are then documented by the mentee that help to track progress. It’s a two way street: the mentee has to commit to doing work outside the meetings and the mentor has to provide feedback and guidance to make it worth their while.

Mentors have helped me get through some tight spots. I have had career failures – just like we all all do – and whenever I had those challenges, my mentors helped me get through them. Now I want to pay it forward and I have many, many mentees and many of them just find me. In fact, the latest mentee who reached out to me found me through an IBF podcast on Forecast Value Added. He’s currently implementing S&OP for a company in Atlanta and he wanted my perspective on certain challenges that he’s facing, so we connected. My point being, when people reach out to you, think about how you can help them and don’t be shy about formalizing a mentor/mentee process, whether that’s internal or external to the company.

Leadership Is Driving Team Members Towards Self Actualization

Ultimately, high-performing teams in any field is down to leaders building up their individual team members, giving them mastery over their domain, and bringing them to a point of self-actualization whereby they become the value drivers of the organization. It’s my goal at all times to build people up so I’m not the smartest person in the room. 

One of the best ways to develop demand planning teams is training and certification. IBF’s Certified Professional Forecaster program trains your team in demand planning best practices and validates their knowledge and skills. Upskill your team. 

Research carried out by EY in 2019 suggested that more than 90% of senior executives were making or planning to make risk management and Business Continuity Planning key pillars of their businesses, and that 70% already had begun to. Following COVID, which struck in early 2020, these findings have not aged particularly well. 

COVID or not, we know that a majority of companies lack an effective planning process. It raises the question, why do we so frequently invest substantial time and effort into implementing corporate planning without seeing it through to completion?

Applied behavioral economics can help answer his question. This discipline examines the social, psychological, and emotional factors in organizational behavior and decision-making, and an understanding of its core concepts can shed some insight on what we can do to maximize the chances of success when implementing a planning initiative. 

Concept 1: The Isolation Effect

In simple terms, the Isolation Effect describes how people are not good at making complex judgements, and therefore prefer to break down integrative processes into isolated components. In a strategic context, the people responsible for implementing strategy usually aren’t thinking about the overall organizational picture; they’re concerned with their own part in it, because that is a level of complexity that people can readily understand and act upon. 

The result, as we have all seen, is that departments devolve into siloed thinking, focusing only on how a strategy or initiative impacts them, and not the business as a whole. 

When teams consider only their own tasks, it is unlikely that the overall strategy will come to fruition

The problem here is that organizational strategy is usually holistic and integrative, and requires considerable mutual interdependence across functions. When teams only consider their own role and tasks, it is extremely unlikely that the overall strategy will ever fully come to fruition. 

Some management frameworks such as S&OP and IBP attempt to address the resulting siloes by (theoretically) connecting every part of the enterprise to a core set of objectives and metrics, but without explicitly making a call to action these processes frequently become mere rote recitations. 

Concept 2: The Status Quo Effect

In essence, we respond to the Isolation Effect by pushing the strategy to all levels of the organization and setting up communication between the groups involved. Putting aside the practical issues with such an approach, this generally leads to an unintended outcome that is even more pernicious. 

When faced with considerable complexity and/or uncertainty around a task or decision, people tend to avoid making any sort of commitment to a path and stick to what they have already been doing. This is commonly known as the Status Quo Effect. 

Attempts to push an integrated strategic plan down through an organization frequently fail

Between issues of isolation thinking and status quo responses, it is unsurprising that attempts to push an integrated strategic plan down through an organization frequently fail. 

Connecting Individuals to Enterprise Objectives

As both the Status Quo and Isolation Effects arise both from an individual’s disconnection from overall objectives and the misapprehension that many leaders have about the power of their dictates to influence behaviors, we must clearly articulate the reason for the enterprise’s strategies and goals.

It is insufficient to tell a team that “the plan for next fiscal year is 10% revenue growth”. This may be fine as a target, but makes no reference to a plan or strategy, nor does it provide the many stakeholders with sufficient context or purpose to make clear what specific action is required of them.

Leaders often fail to take the time to explain why each of the steps or actions are necessary

Similarly, while S&OP and IBP processes make a valiant effort at connecting corporate strategy with individual departmental plans, their leaders often fail to take the time to explain why each of the steps or actions are necessary, and why the corporate goals and plans are what they are. Thus, in both cases, although a high-level plan may have been communicated, the complexity which challenges human judgment remains unaddressed. Where questions persist, inactivity invariably arises.

Define Explain Enterprise Targets & Goals

To address the psychological root causes of this inaction, effective communication not only of the plans and the reason for those plans, but also of the specific expectations of action for every stakeholder is key. In practice this can take several forms. In the case of Annual Operating Plans, an explanation of the rationale supporting targets – e.g. why did we choose 10% growth, and not 20% or 5%? – and a requirement from stakeholders to provide a qualitative statement describing how their department will help achieve the corporate plan prior to submitting a departmental action plan and KPIs can help clarify what steps are necessary to advance the plan.

In the case of S&OP or IBP, there are several initiatives which can be useful at addressing inaction. First, a clear statement of purpose at the outset of each meeting, tying the intended objectives and outcomes of that meeting to the overall corporate plan. In the case of a Portfolio Review, that might look like: 

“Our meeting objectives are to review New Product Introductions, End of Life Products, and review portfolio performance over our strategic planning horizon. By ensuring we consistently have a healthy pipeline of new products and space for them to grow by culling underperforming products, we can achieve our objective of 20% contribution of the overall growth target of 8%.”

Asymmetries between executive goal setting and employee tasks inevitably create ambiguity and uncertainty

Provide a clear line of sight on every slide in a meeting presentation to the decision or action that is expected. Going so far as to explicitly write it out on the footer of each slide keeps content creation aimed at this critical objective, but also keeps meeting participants laser-focused on action, as is the intent.

The Bottom Line

It is tempting when planning at the highest level to expect that the reasons for plans or paths to goals are as immediately obvious to everyone as they are to those formulating the plans, but the frequent gap between planning and execution makes it clear that this isn’t the case. 

Asymmetries between executive goal setting and employee tasks inevitably create ambiguity and uncertainty, and the extent to which we struggle to make judgments and plans under uncertainty in complex environments should not be underestimated. Therefore, to increase the chances of successfully implementing any strategic initiative like S&OP or IBP, leaders must be mindful of the root causes of inaction and both overcommunicate the context and purpose of corporate plans and make explicit the paths to action for key stakeholders. 

Jonathon Karelse will be speaking at IBF’s Business Planning, Forecasting & S&OP/IBP Conference in Amsterdam from November 16-18. With dozens of workshop sessions, panel discussions and networking opportunities, it’s the biggest and best event of its kind nf Europe. Click here for more details.

You came to the meeting well prepared. You had all your data well organized, your charts were all updated and you had copies for everyone. The meeting began well, and you offered your insights and recommendations to the team. Everyone listened, but in the end the team went with the numbers the sales team wanted.

You left the meeting feeling very discouraged. They didn’t believe you. They didn’t trust your numbers or insights.

Despite all our preparation and thoughtful insights, too many Demand Planners all too often leave planning meetings without having an opportunity to make an impact on the decisions being made. I know how this feels as I learned the hard way that no one has to listen to my brilliant insights. For that, I had to earn the team’s trust.

Over the years that I worked as a Demand Planner, I learned 5 skills that helped me work effectively when meeting with the sales, marketing, operations, and finance teams. They are:

1. Be data-driven but open to the value of experience.
2. Know your products and customers.
3. Be bold in planning and humble in correcting.
4. Collaborate without ego and let others be right
5. Be teachable and willing to teach others.

Let’s see how these look in action.

Be Data-Driven but Open to Experience

Demand Planners live in a world of data. We plan by looking at trends and monitoring KPI’s, and we know where to find data to support our recommendations. But not everyone understands the value of using data in planning. Salespeople in particular often view data as only part of the overall planning process.

They are in regular contact with the customers, they manage the products, and they drive the programs that support the sales plans. And when we present data that challenges their perspective, we should expect that they will defend their numbers.

Most often, the best plans balance the impact of both data and experience

So we need to present data in a way that doesn’t openly risk making them look wrong. One way I managed this was to say, “My numbers are different from yours. Help me understand what I might have missed in getting to my number.”

We need to invite them to help us better understand the business, and where it makes sense, be willing to incorporate their insights into our planning. Most often, the best plans balance the impact of both data and experience.

Know Your Products & Customers

It’s much easier to plan items that we know. That’s why when I worked as a Demand Planner, I attended product reviews and also visited the locations where my products were sold. I wanted to know what the products looked like when they are on the shelf, how they are priced, what items were set next to them, and where in the location my products were stocked.

I also met regularly with the customer teams responsible for ordering and shipping our products so that we would both know how they expected our products to ship and perform. We jointly managed product shortages, returns, defective products and pricing issues. By doing this I knew first-hand what issues might impact product availability, and I was able to include this information in my planning.

Be Bold in Planning & Humble in Correcting

It can be intimidating to work with sales, finance, marketing and operations people who have more experience in the business than we do. They know from experience what issues can impact production, shipping, and sales so when we offer recommendations, we need to be confident in our numbers.

At the risk of sounding obvious, this means we need to know our numbers. We need to believe that we have something of value to offer the team — because we do. We have the data that the team needs to consider when making planning decisions. And we need to be able to present our recommendations artfully and confidently.

We need to be humble when it’s clear that our numbers are inaccurate

We also need to be humble when it’s clear that our numbers are inaccurate or where other factors trump our information. Defending a clearly inaccurate or outdated viewpoint will quickly undermine any confidence that the team might have in us. Instead of defending your numbers, openly thank the team for their insights and incorporate their perspective into your planning.

Collaborate Without Ego & Let Others be Right

Planning in most businesses is a relatively high-stakes process as company profitability, stock values, and individual bonuses are often on the line. This means that people’s egos are often involved, and this can cause both individuals and teams to make poor decisions.

When people feel that something they value is under attack, they will most often try to defend their perspective even if this harms the team’s overall goals. As Demand Planners we need to take responsibility for removing our ego from any recommendations we present.

When people feel under attack, they will defend their perspective even if it harms the team’s overall goals

Further, we need to tactfully call out others when we believe that their perspectives are driven by their ego. When someone on the team loudly and persistently defends their viewpoint, we can acknowledge that they feel strongly about the issue and invite them to tell us more about why they think their viewpoint is right.

It may be that they are only expressing frustration with the planning process (which can be messy). Or it may be that they have experience with previous similar situations and did not speak up then, so now they are working to make sure their voice is heard. In any case, inviting them to share their reasoning with the team can help reduce the impact of their ego in the planning process.

Be Teachable & Willing to Teach Others

Any effective planning process is also a learning process. No one can anticipate all the factors that can impact a product’s availability and performance. Good S&OP teams are always learning new information about their customers and their markets.

No one has all the answers. We need to actively participate in learning all that we can about our products, customers and markets. We also need to learn how to effectively interact with the members of our team. Some of them will want to know everything we can tell them about their business, while others will be satisfied with a general overview. Some of them will constantly challenge us, while others will see us as a valuable resource and include us in their planning.

Some team members will constantly challenge us, while others will see us as a valuable resource

And when we get the opportunity to show others how we analyze our business and what factors we include in making recommendations, we should gladly share with them what we know. By listening to others and sharing what we know, we can build relationships that will encourage others to trust our judgment.

Trust Takes Time to Build and is Quite Fragile

Remember that no one owes us their trust. It is something we must earn. And we earn trust by offering the team what we know and learning from them how to best support a solid planning process. Our goal must be to help create an environment where everyone can contribute to a pool of knowledge that we can all share and use to make the best possible decisions for the company. This won’t happen overnight, and there will be people who will never trust us completely.

You don’t go to meetings to be ignored. Hopefully what I have shared from my own experience can help other Demand Planners understand how to patiently build trust in the demand planning role so that they can participate actively in an effective and profitable planning process.

This article originally appeared in the Summer 2022 issue of the Journal of Business Forecasting. To receive a print copy of the Journal every quarter, become an IBF member or subscribe. 

Maybe you just had a poor quarter with your forecast not aligning to operations or business plans. Maybe there was a series of bad product launches, or you’re not getting the cross-functional collaboration you need. Maybe you went to an IBF conference came to the conclusion that S&OP would be a real competitive advantage for the company. Whatever the reason, something has triggered the need to implement a new S&OP process.

[This is the first in a 2-part series about setting up a new S&OP process. This first part focuses on the ‘People’ aspect. Stay tuned for part-2 which focuses on ‘Process’.]

Now comes the most difficult step in all S&OP/IBP journeys – the first one.

Where do we start? What elements comprise an effective process? How long will it take? Who should be involved? How do we get the right functions on board?

There is a plethora of questions you must answer before you start, and many variables that will shape your organization’s S&OP. In the immortal words from the cover of the Hitchhiker’s Guide to the Galaxy – don’t panic! The key is to build a process that responds to business needs and that works over time.

Keep in mind first:

S&OP is not a project or overnight activity; instead, it is driven by continuous incremental improvements where the goal is to keep getting better.

Start where you are and build for where you want to be, and never be satisfied with where you get. This is the S&OP journey and maturity process.

Now that we’ve those 2 guiding principles, we should take time before the first meeting even occurs to do as much as possible to set the process up for success. The start-up of a new S&OP process is similar to the start-up of a new organization in that success depends on groundwork being laid long before launch. In this preparation phase, the vision is defined and decisions are made regarding People, Process, and Technology.

Questions to be answered and activities in the initiation phase may include the following:

1. Find The Right Sponsor

The sponsor will be a senior executive in a corporation who is responsible for the success of the process. While he or she may not be involved in the day-to-day operations of the process design, they are the senior champion of the S&OP/IBP process and biggest cheerleader. This is the executive that the initial S&OP team may turn to for support and to help break down potential barriers. It is someone high up that has your back and may be able to authorize resources or garner additional support.

This person need not be your direct authority and I have seen many times this role filled by a leader from another function. The most important quality is that they believe in S&OP, are willing to assist in winning over stakeholders, can authorize decisions, and be an advocate for the process.

2. Appoint An Owner Of The Process

Ultimately, this person sets senior management expectations, leads the monthly S&OP planning process, manages conflict, and guides the S&OP teams toward success. Far too often I see someone with another role adding the responsibility of S&OP to their existing tasks. While this can work (I have been that person myself) it is far better to have a S&OP manager or owner solely dedicated to the process start-up.

This role has significant responsibility pertaining to communication, managing the process, diffusing conflict, and leading change management – all of this requires time and focus. With all this in mind you need “a” owner and person that drives the process forward without their time being split between another role.

Another reason for having a dedicated S&OP manager is that S&OP is a cross functional, end-to-end process and needs a liaison that bridges all departments without bring the bias of their function.

3. Decide Who Needs To Be Involved

The answer, paradoxically, is most likely “everyone and a select few”. S&OP done right will impact every function and change the way business decisions are made. Your core team on the other hand may not be that large, rather a strategic, cross-functional group. This core team may include Finance, Demand Planning, Operations, Commercial, and IT. Initially, try to keep the core team light but do not lose sight of everyone else that you may need buy in from or who will be impacted by the S&OP process.

4. Level Setting & Educating

Change management is one of the most important and overlooked parts of a new S&OP process. People are fine with change until what they do day-to-day is disrupted. S&OP touches everyone and it is always best to educate and elevate all participants. Training helps to get everyone talking the same language to and provides a foundation of knowledge to accelerate adoption and acceptance of a new process.

Training also helps with fears of the unknown and provides vison and direction for what you want to accomplish, further facilitating adoption. This may be a 3-day workshop or in-house training but the key thing is to reveal what S&OP means for the organization and individuals involved, and to instill best practices.

To build a collaborative forecast, you need more than just Marketing, Finance and Supply Chain; you must have Sales involved in the process. They add customer level insights, market intelligence, and real time information that is often not available from anyone else.

Making and keeping a connection with your Sales partners is not easy, but it will pay dividends if you are willing to put in the effort. Here are a few key practices I have used successfully to build a good two-way relationship with Sales that has not only benefited forecast accuracy, but helped Sales drive revenue.

Don’t Assume Everyone Thinks Like You

Never assume Sales is operating with the same “one number” philosophy that Supply Chain uses. Make sure to ask if there are customers being targeted for growth or that are being allowed to decline. You might be surprised to find variances that will provide you with valuable insights that algorithms simply cannot identify.

Do not assume that every person you engage with in your forecast discussions will interact with you the same way, and process data the way you do. Learn Sales vernacular—do they use dollars or units, what calendar period do they compare to, and how do they aggregate their data? Be prepared to modify some of your data to make it user friendly for your audience.

It is important to understand that you will encounter colleagues in Sales who embrace the approach, soak up data, and ask for more. You may have others that are not as enthusiastic to engage and need more time to get up to speed. As you both learn how to work better together, always be clear as to what it is you are looking for from your relationship with them. Do not assume they know what a Demand Planner needs to do their job properly, and vice versa.

It is always good to remind those you work with what the demand forecast is used for in your organization, and how valuable the work done to improve forecasts is to company performance in terms of inventory savings, increased revenue, and customer satisfaction.

Work Hard To Be One Of The Team

Often the personalities of Sales are more extroverted compared to those in Supply Chain—do not let this intimidate you. Show your interest in learning what challenges they face, how they are measured and—equally as important —get an insider’s perspective on your customers. Start by asking to attend sales meetings, customer reviews, planning sessions, and whatever is relevant to your role and available in your company.

As your presence becomes more familiar, and you begin to understand the Sales culture, you can learn what important goals they are working towards, how they are incentivized and, most importantly, they will become comfortable with sharing important insights and keeping you connected. As you build a reputation for being passionate about helping drive the business, you create partnership opportunities. As you build this rapport and establish trust, you can ask harder and more challenging questions, and ask for feedback to make things easier.

In a strong two-way relationship, you need to ensure you are giving at least as much as you are getting. As you build your connections over time, you will begin to get more invites to important meetings, receive more relevant emails, and communications will be less challenging.

Trust, Trust, Trust

Now that you are building your connections, you need to ensure you maintain trust. Many people avoid the forecasting process because it is one where you are often wrong. Make sure you give lots of credit to your colleague/s in Sales when you get information that leads to a better forecast.

You also need to show appreciation for the effort in getting information that may not be valuable as well. Customers are not always forthcoming with their numbers but having a Salesperson that is willing to make the effort and engage with a customer to get information is extremely valuable. As you develop a good flow of customer information, you can utilize and learn to refine the data over time.

Remind Salespeople frequently why good forecasts are important. If your motivation is about better customer service and improving profitability, you will get more support than if your only motivation is to improve your own MAPE.

Think Like A Salesperson

Sometimes you need to act like you are in Sales to communicate with Sales. Anyone who has worked in Sales knows you need to be persistent to get a customer’s business. You may have to be persistent to get their responses and to hold their interest. Do not give up when you don’t get fast responses to your questions. Instead, keep asking how you can help them serve our customers better. Remember, persistence pays off.

As you review data, you can also think like salespeople. For example, I noticed that one of our customer’s volumes had declined over the years on a group of items. Since the Salesperson in charge of this account was new, this information provided him a previously unknown opportunity to pursue. Often customers are moved between members of the Sales team, and information is not always transferred effectively.

Do not assume that important pieces of information like this are already known. By providing helpful insights to new hires, you will build better relationships.

When reviewing future sales projections, most salespeople tend to be optimists. To help reduce this spin, I often ask them to project as if they were wagering their own money on the outcome. Phrasing the question to include a pretend bet on the outcome, using money out of their own pocket, may change their frame of mind to be more realistic.

Sell them on ideas like participating in annual sales planning meetings, getting you access to customer portals, including you in customer calls, and even connecting you to individuals at the customer who are directly involved in the purchasing process. If you can take some of the burden off Sales and get information directly, you both win.

When hiring Demand Planners, consider those with successful experiences in selling or working with Sales as they can bring valuable skills to your team. Sometimes it helps to think small if you have just begun to work with the Sales team. Start by building a strong relationship with just one member of the Sales team, and that can become a springboard to expanding your reach. Showing others the work you have done with another member of their team is an effective way to expand your network with the Sales team.

Keep Score & Take Advantage Of Salespeoples’ Competitive Nature

You need to introduce forecast metrics into the conversation at some point, but keep it simple, especially in the beginning. Forget about MAPE, WMAPE, MAD and other metrics that are difficult to understand and not directly relevant to salespeople. For example, try forecast bias percentage (forecast/shipments-1).

This measure is an easy way to show trends in forecast performance that need attention. If you are showing your sales partner that we have over forecasted their customer by 25% the last 4 months, this is a good starting point to take action, and does not require a background in statistics.

Connect metrics directly to each salesperson through their customer and establish forecasting metric targets that are adjusted to the variability of the customer. The most challenging customers should have lower forecast accuracy targets, and vice versa. Your goal is to create a level playing field to stoke competitiveness among your selling professionals. At virtual meetings with the entire sales team present, I have had a lot of fun presenting a Forecaster of the Month award, complete with certificate and photo. Make sure they understand how the metric works, how they can provide additional insights to potentially override the current model, and let the games begin!

Keep It Simple

Everyone’s time is valuable. As I mentioned above, keep metrics easy to understand, and keep the data you share simple, and in a format where it is easy to see the key points. During your forecast discussions or exchanges with your Sales partner, don’t ask for analysis, instead ask for answers. Lay out the situation, then provide specific options or directions to take.

My questions look more like multiple choice rather than ‘fill in the blanks’. I have found this approach to return clear and actionable responses. If you are not getting actionable responses, you may need to better frame how you are asking the question.

Ultimately, where Sales can lend the most value in planning is to explain or — better yet, alert to — outliers. Statistical models do fine when demand is steady while qualitative customer information is very valuable is when there is a change in course. Did a customer gain new volume and, if so, approximately how much and when will it begin? Has there been a shut down due to the pandemic, did they delay a new product launch, or even go out of business?

Since you are now like a member of their team, and better understand their business, you can ask simple, clear and relevant questions and get valuable insight that explains outliers and improves your forecasts.

Win Over Their Leader

As with any large and important change initiative, you need to get their leader’s support early. You may have to work hard to convince them to adopt a forecast KPI to their metrics—to facilitate this, share the dollar value of improving forecast accuracy, i.e., what savings are gained for every one percent improvement in under- or over-forecasting.

If you have not done this exercise, IBF has easy-to-use calculators that can help. Connecting dollars to forecasting improvement will help you get your Sales Leader interested. Remember, how their leader interacts with the demand planning team will set the tone for how the Sales team as a whole interacts with you.

Remember that effective relationships are built over time, not overnight. This is especially true if Sales and Demand Planning have not had a strong connection in the past. By applying the tips above, being an engaged partner, and being willing to lend a hand when needed, you will gain insights into your customers’ behavior and intelligence that will lead to better qualitative forecast inputs.

This article originally appeared in the Spring 2021 issue of The Journal of Business Forecasting. Become an IBF member and get the Journal delivered to your door quarterly, plus discounted entry to IBF conferences and events, members only tutorials and workshops, access to the entire IBF knowledge library and more. Get your membership.