The Benefits of Partnering with Finance in the S&OP Process

S&OP is a cross-functional, collaborative forum that acts as the ‘operating system’ for a company. In this article I discuss how involvement of Finance in this process allows us to understand the financial implications of the demand plan, facilitating fully costed and financially viable demand management responses. It also allows us to know inventory and production costs and to develop accurate revenue and earnings estimates. I also reveal how Finance’s involvement leads to a robust Annual Operating Plan, avoiding the issue of disconnects between the plan and what actually occurs.