Beyond S&OP and IBP to Enterprise Planning and Performance Management

Foresight's Spring 2015 issue featured the article "From Sales & Operations Planning to Business Integration" by Mark Moon and Pete Alle. Although the terms Sales and Operations Planning (S&OP) and Integrated Business Planning (IBP) are often used interchangeably, Moon and Alle consider IBP to be the more comprehensive label, since it implies engagement beyond sales and operations to bring finance and senior leadership into supply chain planning. These authors argue, however, that despite good intentions and extraordinary effort, IBP implementations often fail to achieve effective business integration. For better success, they urge changes to organizational structure, processes, and culture. Dean Sorensen builds on their thesis here, outlining a still broader vision of IBP, one that extends beyond supply chain to encompass enterprise planning. He observes that, as complexity rises, capability gaps are exposed in processes that are supported by separate S&OP, financial planning, budgeting, and forecasting applications. He describes how technology innovations can close these gaps by enabling integration of strategic, financial, and operational planning and performance-management processes. He likens the importance and value of these innovations to the financial and operational convergence that gave rise to Enterprise Resource Planning (ERP) two decades ago. Copyright International Institute of Forecasters, 2016