Lecture 7: S&OP
1. S&OP purpose
1.1 Purpose S&OP: Looking for alignment
The need for cross-functional coordination arises from functional conflicts among areas such as
sales, marketing, logistics, finance and operations. These conflicts are rooted in structural
causes, such as contradictory reward and evaluation systems product and production
complexities, market orientation, and experience and culture, and are often aggravated by
capital constraints and technological changes
1.2 Effect of S&OP on firm performance
− Cross-functional planning processes can mitigate the negative effect of misaligned
organizational structures and contradictory incentives schemes on firm performance
− Collaborative aspects of planning, formal groups and informal communication between
functions, networking and internal integrating roles can boost firm performance
− Furthermore, internal alignment seems to facilitate supply chain integration with both
suppliers and customers, particularly when inter-organizational information systems
favor supply chain integration
1.3 S&OP performance: model I
1. S&OP purpose
1.1 Purpose S&OP: Looking for alignment
The need for cross-functional coordination arises from functional conflicts among areas such as
sales, marketing, logistics, finance and operations. These conflicts are rooted in structural
causes, such as contradictory reward and evaluation systems product and production
complexities, market orientation, and experience and culture, and are often aggravated by
capital constraints and technological changes
1.2 Effect of S&OP on firm performance
− Cross-functional planning processes can mitigate the negative effect of misaligned
organizational structures and contradictory incentives schemes on firm performance
− Collaborative aspects of planning, formal groups and informal communication between
functions, networking and internal integrating roles can boost firm performance
− Furthermore, internal alignment seems to facilitate supply chain integration with both
suppliers and customers, particularly when inter-organizational information systems
favor supply chain integration
1.3 S&OP performance: model I
