Sales and operations planning in the era of demand driven MRP
Can your business leverage S&OP for planning and DDMRP for forecasting? Yes, but there are important caveats and ERP requirements to make it work. S&OP looks at more variables than DDMRP, including average cost with labor. DDMRP, for instance, considers labor to be a fixed cost. But even relying on ERP to facilitate S&OP, the software should still be able to facilitate the basics of DDMRP including:
- Identifying and visualization of each product family master by both gross margins and net revenue
- Providing the sales price as required by DDMRP, using average cost, which is different than what you would use for accounting purposes—true variable material costs
- Visualizing unprotected lead time
Find out how the right ERP software can help you get the real-world insight and control of S&OP along with the preparation for demand shocks that comes with DDMRP.
File Information: White Paper, pdf 0.5 MB