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Sales and operations planning (S&OP) is the process of coordinating marketing and operations. It is designed to align demand processes such as sales, promotion and distribution with supply process such as service delivery, supply chain and manufacturing. S&OP is an iterative process that often revolves around monthly or weekly sales volume forecasts.
Definitions- The process of coordinating marketing and operations.
- The process of aligning demand generation with supply of goods and services.
ExampleA manufacturer of cosmetics conducts weekly meetings to set sales and production targets by product. Operations teams seek to utilize the capital assets of the firm productively. Marketing teams can influence demand with advertising, promotion, pricing, sales campaigns and distribution techniques. The two teams develop strategies to utilize capital to improve revenue and profit margins. For example, operations may be able to reduce unit costs of a product by producing large batches. Sales can support this effort with promotional campaigns, agreements with distribution partners and pricing models.
Business Processes
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