Strategic and operational allignment Flashcards
What is MRP ?
MRP is a manufacturing centric which operates based on buying materials based on customers order demands. So, if customers order a lot then as a company i order more materials to satisfy the increase in orders.
MRP II evolves from MRP in what way?
By integrating additional data, such as employee and financial needs.
What came after MRPII and how it makes use of S&OP?
After MRPII, ERP (enterprise resource planning) which made use of S&OP (sales and operations planning) for long-term planning of production and sales relative to forecasted demand.
The planning horizon may be divided into 3 sections: long-term, mid term and short-term planning. For each indicate the time-frame and the type of planning?
Long-term -> 5+ years, strategic planning/IBP
Mid-term -> 4-24 months, tactical planning/S&OP
Short-term -> few days to 3 month, operational planning
What is strategic planning used for?
For product portfolio, customer portfolio, new product lines etc.
What is tactical planning used for?
Allocation of resources: capacity, labor and inventory.
What is operations control used for?
Production scheduling
Compare S&OP and IBP
S&OP:
-short term
-supply and demand focused
-traditional budgeting
-meetings heavy
IBP:
-long term
-involves entire business
-more agile organization
What does IBP need to be successful? Which process? and does it do?
The integrated reconciliation process is basically integrating new information with old information. It involves analyzing gaps, reviewing them, shape a new agenda and understand how these new strategic decisions impact the business.
What is the difference between S&OP and IBP in a sentence.
S&OP is more tactical, goes for volume while IBP involves all departments and all important decision making people with a linear plan which everyone is aligned to.
