Sales and Operations Planning (S&OP) Performance Under Highly Diversified Mass Production Systems

Abstract

Sales and operations planning (S&OP) is a midterm planning practice that is widely used in industries with relatively volatile demand and limited capacities to align demand and supply. Several research studies, as well as practical guides, have been developed to examine the design and implementation of S&OP processes. Most of these studies are general and have no reference to the industry behind them. However, regarding planning, each industry has its properties. Taking a "one size fits all" approach is not profitable for extreme cases, such as for an automotive industry known for the very large product portfolios. Our contribution intends to examine this issue in detail by performing a literature review on the effectiveness of S&OP and its impacts on supply chain performance. We try to reveal why actual S&OP practices are not fit for highly diversified mass production systems, and we deduce that there is a need to redefine the S&OP process for such industries.