The Supply Review is the third step in the monthly Integrated Business Planning (IBP) process. It is where supply chain articulates its response in a forward-looking, time-phased plan within the context of well-defined tactics and strategies.
In our first white paper in this series, ”Connecting Strategy to Execution,” we showed how to integrate corporate strategy with operations by cascading it down the organisation by creating individual strategies and plans at the business unit and functional levels. It then becomes the role of Integrated Business Planning to operationalise the strategies and plans of the business units, managing any performance gaps over a 24-to-36-month horizon.
We used the analogy of portfolio investment for retirement planning, and in the three white papers before this one (Connecting Strategy to Execution, The Portfolio Review, and The Demand Review), we learned that a robust business strategy is needed to drive growth. In the equation of delivering a corporate return on investment, it is the responsibility of the portfolio and demand teams to grow the numerator. At the same time, it is the responsibility of the supply team to manage the denominator, i.e., the cost-to-serve.
The portfolio and commercial sides of the business have to consider which products should be sold and which should be retired, what markets to serve, which sales channels to use, what the value discipline is, and what the customer service expectation is. The supply chain must fully understand these strategies to develop its effective supply tactics and strategies in response. The integration of these decisions must continue to deliver the expected corporate returns.
The Supply Review is the third step in the monthly Integrated Business Planning process. It is where the supply chain articulates its response in a forward-looking, time-phased plan within the context of well-defined tactics and strategies. The Supply Review seeks to provide insight on performance to budget, both past and (most importantly) projected, modeling the impact of tactics within manufacturing, sourcing, distribution, and logistics, including the documentation of assumptions, opportunities, and vulnerabilities around the forward plans, as well as the risks from commodities and FX.
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