What is a Supply Chain Planning System?

With all that has occurred in our global environment, the topic of supply chain has more awareness than ever before.  Today’s supply chains are increasingly complex and challenging to manage, creating more need for resiliency. It’s easy for businesses to become stuck without the proper planning and tools at their disposal. A supply chain planning system helps businesses coordinate assets to optimize the delivery of goods, services, and information between the supplier and the customer to balance supply and demand. Let’s break down what a supply chain management system is and how to maximize your process to deliver customer centric excellence. 

Key Elements of a Supply Chain Planning System

To successfully implement supply chain planning, you must seamlessly connect teams and information across your entire network. This involves multiple elements coming together to form a cohesive structure. 

Demand Planning

Demand planning is one of the most critical steps in supply chain planning. This step involves forecasting demand to maintain proper inventory and avoid running out of stock or dealing with surpluses. Historical data, projected sales, market conditions, and more are all factors that demand planners must consider when making their calculations. 

Fortunately, technology exists to make demand planning easier than ever. These tools harness artificial intelligence and machine learning to precisely predict demand by utilizing real-time and point-of-sale data. They also use predictive analytics to better understand consumer behavior, buying patterns, and other factors that influence demand. 

Supply Planning

During supply planning, an organization comes up with the process that connects the demand plan to the business’s goals. This involves sourcing raw materials, components, and other goods needed for production. Supply planning is crucial to meet the demand for products efficiently and productively, maintaining a resilient business. 

Production Planning

Production planning includes allocating employees and resources and handling material and production capacity. When creating a production plan, a business’s goal is to reduce waste and produce only what is required to deliver optimal inventory. In this step, supply chain planning and inventory management come together. 

Sales and Operations Planning (S&OP) 

This step is usually conducted on a semi-regular basis, ideally done at least once a month. During this process, diverse teams come together to merge sales and financial plans with operations. They coordinate supply assets and capabilities to meet demand requirements for the short and long term.  A key objective is to reach consensus on a plan that allocates supply to reach corporate performance targets and market demand. Sometimes, this evolves into a larger process called integrated business planning, which incorporates the plans of other departments such as finance and HR in a single, single company-wide plan, driven by corporate goals and vision. 

Supply Chain Planning Solutions

You don’t have to be on your own for supply chain planning.  As mentioned, technology solutions are available today to make this process easier and more accurate.  A quick review of  some of the features that these software solutions provide for your business: 

  • Automation: The biggest benefit of a supply chain software solution is that it automates your forecasting procedures. Your forecasts are more accurate and faster to complete, leaving you with more time and more money. 
  • Synchronization: You must collaborate across your supply chain to succeed at supply chain planning. This keeps your customers happy because you can better meet demand. When you have the information you need at hand, you can ensure you accomplish customer satisfaction while reducing truckloads of inventory. 
  • Inventory Allocation: When you are low on supply, you can still avoid lost sales and eroded profits by ensuring your inventory is cost-effective by responding appropriately to changing conditions. 
  • Replenishment: You can automatically build your replenishment orders and project inventory ahead of time to adapt whenever you need to. The market is ever-changing, and this is a critical feature. 
  • Investments: You can more easily manage events, make forecasts, and review and identify exceptions in your demand. It’s easier to predict anything that may come up in your supply chain so you can focus on investing and profit opportunities. 

The Best Supply Chain Planning Solution

Not all supply chain planning software are created equal. Blue Ridge Global is focused on delivering intelligent, accurate, easy-to-use software that helps you accomplish your inventory goals quickly. We offer all of the features mentioned above and far, far more. Try a demo of our software and see what we can do together.