Sales and production planning is often a mammoth task because numerous departments are involved. Data must be regularly queried and harmonized to even start planning. This is often because the data is not integrated and the result is data silos. In this blog post, we address this problem and explore solutions.

The process of sales and operations planning (S&OP) is one of the most important tasks for organizations in manufacturing. If the processes are properly coordinated and integrated, the organization will always have an accurate overview of required resources for production to meet demand.

As a result, purchasing staff also know exactly when which parts need to be available and can align their planning accordingly. In this way, harmonized S&OP processes lead to increased profitability for the company.

The problem with data silos in the planning process

In many manufacturing companies, large and small, sales reps and leaders regularly consolidate their data in a central spreadsheet. The sales data must then be enriched with master data from the ERP to implement sales and production planning. This is a tedious and lengthy process, in which often only monthly data is available instead of daily data because it takes so long. Due to the repetitive and tiresome tasks of getting the data to the spreadsheets, errors often occur when copying and pasting the data.

The underlying problem is the retention of data in the various source systems, which effectively act as data silos. Sales relies on CRM systems such as Salesforce, production relies on an ERP, and purchasing relies on a procurement solution. Accounting and marketing often use their own specialized systems as well, oftentimes even different ones in the various regions of operation. The data for a coherent overall picture and a 360° overview are there, but not connected.

For planning purposes, dozens of exported Excel spreadsheets have to be collected, reconciled and merged each time. This not only costs everyone involved time and nerves, but also means that the data is no longer up to date, once leaving the source systems through an export.

Breaking up and preventing data silos

The problems caused by data silos are clear: sales and operations planning takes too long, plans are inaccurate, not very up-to-date, and difficult to adapt. Controllers from Finance and other departments as well as supply chain managers are doing themselves as well as the organization a favor by fixing the silo problem.

That’s why some companies are using solutions that incorporate and unify all relevant data. Ideally, they are also automatically processed via ETL (Extract, Transform, Load). The central databases serve as a single source of truth.

In order to get rid of data silos in the long term, it is valuable to talk with the managers in the different departments. If they introduce a new software solution for a specific problem, data integration is often forgotten in that process. Educate your colleagues about the importance of integrating data. Their teams will also benefit from not having to deal with data exports on a regular basis.

Combining a single source of truth and planning

A data warehouse is an important first step to enable Finance, Sales, and production planners to work more collaboratively based on the same data. But when it comes to planning, multiple new Excel spreadsheets are quickly created. To avoid this issue, modern software solutions provide the capability to unify your database, planning, and analysis solutions.

This has the advantage that the data can also be edited directly and the effects of new figures on plans and forecasts are immediately visible. New spreadsheet chaos is prevented and new isolated applications in specialist departments are avoided. All performance management happens with a single unified solution.

The complexity of the data of hundreds or even thousands of products along the supply chain thus becomes transparent to all stakeholders. Important links between sales, production and purchasing can be uncovered and identified. This also makes it easier to plan and coordinate the constantly changing demand for employees, machines, and parts.

Harmonizing and automating processes in this way also offers many advantages for sales forecasting and capacity planning at production sites. If all data is available uniformly, consistently, and centrally, reports and forecasts are easily automated. This means that all departments are always informed about the current situation and can adjust their sub-plans accordingly, if necessary. A unified solution for everyone ensures that the effects are always reflected in the other subplans and the top-level plan as well. Instead of having a multitude of different measurement standards, the most important KPIs can be defined consistently for everyone across the organization and resolve the data silo problem.