Advanced Demand Planning with S&OP and SAP HANA
- by Anjali Butley, Solution Architect, SAP SCM and SAP Integrated Business Planning
- December 16, 2014
Learn how to meet the challenges of integrating SAP Advanced Planning and Optimization (APO) statistical forecasting with SAP Sales and Operations Planning (S&OP) and SAP HANA.
By reading this article, you will learn how to:
- Configure advanced demand planning of SAP Sales and Operations Planning (S&OP) powered by SAP HANA
- Overcome challenges of advanced demand planning of SAP S&OP and SAP HANA with SAP Advanced Planning and Optimization (APO)
SAP Sales and Operations Planning (S&OP) is a solution powered by SAP HANA that supports an organization’s end-to-end sales and operations planning business process. In SAP S&OP, all related data is stored and calculated in a real-time in-memory database.
Sales and operations planning (S&OP) is a periodic business process that involves focusing on and synchronizing financial, demand, and supply planning. Most organizations follow a monthly process that consists of the following steps: demand review, supply review, pre-S&OP review, and executive review (Figure 1).
A sales and operations planning process cycle
Organizations may have many process steps according to their requirements. The S&OP planning process requires up-to-date forecast data to plan sales, production, inventory, customer lead time, customer back orders, new product developments, strategic initiatives, and financial plans. The planning horizon and frequency vary based on specific industry.
SAP S&OP is built on SAP HANA’s aggregation and planning engine. The solution is based on SAP HANA, which can handle large data and calculations with high performance. SAP S&OP features standard modelling for demand, supply, finance, and supply chain planning. Various planners can plan what-if simulations in real time and plan very quickly at all levels due to the in-memory computing platform. SAP S&OP enables real-time collaboration with various stakeholders to take input and consensus with transparent data to achieve an organization’s common goal — volume, revenue, and profitability. SAP S&OP’s user interface is based on Excel and web services.
In the demand review of the SAP S&OP business process, review of forecast accuracy is an important step.
I cover advanced demand planning of SAP S&OP powered by SAP HANA, configuration and execution of advanced demand planning for statistical forecasting, and challenges of integration. I also list a few tips for you to use in the sidebar titled “Integration Challenges.”
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