IBP unites multiple disciplines and multiple process steps to develop an optimal business strategy, managing risk and developing mitigation plans, and seeking out business opportunities. Companies cannot afford to experience latency in supply chain planning information due to system disconnects. Part 1 (“How to Plan for Sustainable Growth”) explored the value of IBP in building sustainable business growth. But one that’s almost universal is supply chain management. Leadership needs to understand what is truly driving the business — what causes increases and decreases in revenue or demand. Finance understands the ‘volume’ input and the other functional areas understand the financial ‘value’ planning. At Oliver Wight we developed the term Integrated Business Planning to describe a process with the following characteristics • A process, led by senior management that, on a monthly basis, evaluates and revises, time-phased projections for demand, supply, product management, strategic projects and the resulting financial plans Monthly IBP discussions focus on changes, outliers, and closing performance gaps; and a key strength of the process is the ability to dynamically create robust updates to the business and financial outlook. Senior revenue person conducts, Produce /procure at the lowest reasonable cost, Conducted by senior supply chain person, Participated in by individual contributors in supply chain and middle management representation from all areas, Performance reports (KPI measurements) reviewed and supporting documentation prepared, Recommendations documented and prepared for management decision, Agenda for Management Business Review prepared, Conducted by the S&OP process owner and participated in by middle management, Recommendations reviewed and decisions made, Conducted by the S&OP/IBP process owner and participated in by senior management as decision makers and middle management representatives from each discipline. The role of the finance partner in IBP is vital (as described further below), and, hence, the CFO must engage and inspire the team to respond to this opportunity. Some are essential to make our site work; others help us improve the user experience. IBP leads to a major change in the philosophy and execution of business planning (typically a key part of the CFO remit), from major annual or biannual activities to a rolling monthly financial planning cycle. A company might have focused on the state of the art finance processes and systems, but doesn’t reap the full benefits of that due to lack of integration of other functional areas into the finance process. We can also expect these companies to deliver monthly balance sheet and cash flow prediction. Dynamic indicates that opportunity and risk scenarios across all functional areas are integrated into the financial projection. However, one diagram shows that basic demand and supply balancing is offered with S&OP without inventory optimization or advanced algorithmic calculations with respect to demand and supply planning. As S&OP found its origin in the supply chain, IBP is often biased with supply chain terminology and reasoning. A centralized, automated solution for performance data and planning allows coordination between different parts of the business and enables more streamlined, accurate plans. The pressure of globalization and agile decision-making requires companies to improve their business modeling. IBP sets out a clear and structured approach for performance review, empowered decision-making, and forward planning. A key feature of IBP deployment is the creation of genuine cross-functional collaboration to deliver enterprise goals as reflected in the key success factors: In addition to these broad deployment learnings, it is also clear that the finance function has a critical role in ensuring successful and sustainable deployment of IBP in four key areas: As one of the key C-suite sponsors, the CFO has a very significant role in the sponsorship of IBP adoption. Leading this functional shift as part of IBP deployment is a key role for the CFO to ensure that high-quality finance support is present throughout the various cross-functional IBP teams and when decisions are made. That means the business, ligned innovation, demand, and supply plans, . IBP is a specific process for using specific business goals to develop precise financial and operational resource requirements with the goal of minimising risk and maximising either cash flow or profit. Synchronizing and aligning all relevant business planning data in a common platform allows your valuable planning resources to focus on analyzing data to develop recommendations and take actions that lead to added business value. Learn more. Webinar The house of quality originated in 1972 and has been used by thousands of companies in all industries to design, manufacturer, and market products and services. When supported by a collaborative platform that encompasses all relevant data, IBP streamlines and unites planning activity across the business, from demand, inventory and supply to manufacturing, financial planning and strategic planning. The Entire House: Integrated Business Planning Thousands of companies of all size and types have reduced costs, improved service, and gained competitive advantage through Sales and Operations Planning (S&OP) initiatives. Ensuring that departmental staffing targets are in sync with broader organizational objectives requires high levels of planning integration. And in a fast-moving market, manual processes and siloed systems are detrimental to agility. I thought it would be interesting to discuss the components of IBP in a “House of Planning” framework. Learn more. ”, Learn more These strategies create comprehensive, actionable visibility into overall company performance and drive better results. “The sheer level of detail that IBM Planning Analytics provides is very impressive … We can calculate our sales and gross margins for each SKU in IBM Planning Analytics and generate insightful reports at the click of a button. They see the value of providing real-time data to decision makers and taking the guesswork out of forecasting. This is rarely a simple task and too often it involves manual spreadsheet-based processes. Whilst the deployment of IBP represents a significant organisational change, considerable insight on the key success factors for the execution of IBP has now been accumulated. Gartner Predicts by 2020, at least 25 percent of large organizations will increase planning accuracy by integrating key operational planning processes with financial planning and analysis.2. The company values and the emotional attachment will be tracked in the monthly IBP process and have actions, goals, and measurement. Contrary to most current defined maturity phases of IBP, one can find on the internet, we also can define IBP maturity phases from a more strategic angle. Experience an interactive demo to get a real taste of functionality. It can be argued that current IBP development is still driven by a supply chain bias. Trends are easier to spot and quickly act on with more accurate and reliable plans. A well-defined achievable BHAG with a vivid description provides employees with an envisioned future they can identify with and which creates an emotional attachment, which makes them go the extra mile. Companies tell us that they become more opportunistic in the market place and increase market share. your Integrated Business Planning process in the current environment of uncertainty? Executives follow progress to understand if employees believe and identify with the companies values, BHAG, and purpose and show emotional attachment. “Because of the way the process allows us to look ahead and be proactive, we can also see billions of dollars of opportunity cost savings way into the future. Integrated planning helps ensure that plans, budgets, and forecasts are created with a holistic approach.