Implementation of the S&OP process in textile company case study: Ecuadorian textile ABA

Abstract

Among the different issues that many companies face, the lack of a proper Planning process deviates the company to accomplish their objectives and goals. This shortage generates miscommunication, discoordination and problems among different departments, such as Marketing, Sales, Operations, Purchases and Finances. Planning is a guide for organizations to meet these goals and objectives, while efficiently using resources, managing risks and uncertainty and, creating competitive advantages. Therefore, it is important to implement and improve an appropriate planning process, based on a supportive methodology. It is here that Sales and Operations Planning (S&OP) arises as a useful methodology. It starts with an assessment of the current planning methodology the company uses, the market in which the business operates (based on Forecasts), and the supply provided to meet the demand (based on Time Studies, Production Capacity, Safety Stocks and Optimal Batch Size calculations); later creates and implements a production plan that will guide the company by tactical and operational procedures to fulfill customers' demand monthly. This methodology will be presented by a case study applied to the Ecuadorian textile company named ABA, which gained significant results due to the usage of the S&OP process.