S&OP and Collaboration
As media partner for the IE group, I didn’t need a lot more trigger to write a blog then the tag used for the October 2012 summit; ‘Advanced S&OP: Create True collaboration’.
You can find my whitepaper on S&OP and collaboration here: SCT on S&OP and collaboration
I’ve always been interested in collaborative processes like Collaborative Planning Forecasting & Replenishment (CPFR) and Sales and Operations Planning (S&OP). Collaboration seems to devy our natural habit to work on our own goals and instead work on a shared goal or interest. My gut feel has always told me that this is not a natural behaviour and an environment has to be created where collaboration can actually happen. Research that shows that only 50% of people naturally cooperate and 30% are selfish seems to confirm my gut feel.
I know there are many great examples of collaborative efforts. Still collaboration seems to me one of the most misused, or abused words in business language. Often, where people coordinate or cooperate together to get a job done, the word collaboration is used. A lot of meetings, emails, project planning and execution to get a job done between many people from different functional areas, doesn’t necessarily mean we are collaborating. And if we are collaborating in a particular instance or on one project, it doesn’t mean we have a collaborative culture yet.
Collaborating across company boundaries throws in even more challenges as different company cultures have to find ways to work together on shared interest. Very recently I worked on a project in the extended value chain. The project was called Active Retail Collaboration (ARC). Unfortunately once the interest of the most dominant party in the relationship was served, the project lost focus and the value creation we all talked so much about died with it.
A collaborative culture is not easily created; it requires company vision, leadership resilience, clear and common goals and follow through to change a company culture to a collaborative one. Collaborating across the company boundaries in the extended value chain throws in even more challenges. S&OP as a horizontal process can enable collaboration. Collaboration in turn can drive effective S&OP. Both S&OP and collaboration require trust as a foundation.
Only trust can start open and honest communication and transparent data flow going. This in turn can enable coordination, cooperation and finally, when we have the right people on board who are energized to work on a clear and common goal, collaboration might happen.
To create a collaborative environment, leaders have to get the right people on board and make sure the common purpose or goal is clearly communicated and top of mind of the workforce. People need to feel energized to cross the functional silo’s to achieve these common goals. Personally, leaders will have to lead in creating a trusted environment where horizontal processes like S&OP can flourish. Leaders can do this by staying constructive, even in conflict. They can practice transparency and share and discuss 360 degrees feedback with employees.
Once leaders continuously follow through with rewarding collaborative behaviour, the foundation for a collaborative environment is made. Only time and perseverance can then create a collaborative culture. S&OP will be most effective in a collaborative environment and, through its cross functional nature, S&OP will in return enable and amplify the collaborative culture itself.