Introduction
Almost all operational planning activities start with some estimate of what customers demands will be. In order to develop demand estimates, every company has to forecast both the quantity and timing of demands, and many companies can also influence or manage customers demand patterns through product pricing and through other means. These two activities, demand forecasting and demand management, are collectively known as demand planning.
Initial Post Instructions
In most companies that are considered to be successful users of the Sales and Operations Planning (S&OP) process, the resulting plans and commitments are treated, essentially, as quasi-contracts. That is, the agreement reached between the various parties cannot be unilaterally broken or changed by any party. To change the schedule requires participation of all the parties. They must agree to the changes before they can be implemented. What are the implications of a position as it pertains to how the firm and its functional areas deal with changes?