Streamline your sales process with the siop method

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all organizations need some form of sales and operations planning to be able to function effectively even if you are a charity or public hospital and you don't sell anything then sales is just your demand and your operations are how you plan to do deliver it at its highest level it means considering our expected demand our capacity and making a plan of what work we will be doing this happens at many different time scales at the same time so first looking furthest into the future typically one or two years but sometimes much longer we will be making our long-term forecasts of demand and comparing them against our long-term capacity this capacity might not exist yet part of this process is to be making decisions about the type and quantity of work we plan to do in the long term and this back and forth to decide what capacity we can have we want to have we need to have to fulfill it whether you're a national government department or a burger van business you might have to be making back and forth pitches for investment budgets to make a case for why you need to have certain resources to have the capacity to meet this long term forecasted demand especially as there is always a lead time and adding capacity either hiring another temp worker or a 10 yearly time on building a new nuclear power station simultaneously we need to be looking into the medium term to do a similar process we now have a much clearer idea of our demand a combination of a good forecast based on much more recent data and maybe a few advanced orders are already in two giving us a bit more confidence on the other side our resources and capacity will be clearer with more certainty of what we've got to work with and less flexibility now to make drastic changes both sides feed into making a provisional master production schedule mps this is typically manufacturing terminology but the idea is far more general a master production schedule is the fundamental plan of what outputs will be done made in a certain time period maybe on a weekly resolution initially if you're a car factory it might say how many blue green and red cars you plan to make each week looking six months into the future or if you're a software development company it might be a plan of how many developers you plan to have working on the various aspects of an app development with an intended number of releases per week if you're a hospital it might be how many routine surgeries do you plan to do each week and how many patients you plan to be caring for still there is that back and forth aspect with the capacity plan trying to first make a provisional master production schedule with a rough cut capacity plan and then making plans to increase or decrease your resource allocation ingly and again simultaneously we will be doing the same at a higher level of detail for the planning of demand capacity and the work in the nearer future maybe looking for just a month or so now we might have a much more robust forecast because remember we are continuously updating our forecasts and even better maybe now we have mostly confirmed orders in our queue of work resource and capacity allocation is close to set and we're in a position to make a detailed work schedule for the coming weeks and simultaneously daily work is continuing we've got our resources capacity and our orders to work on whether or not we are working to order or working to stock building to stock and that's all we need to generate our final detailed work schedule of what is actually going to be done right now scheduling and work sequencing is a whole topic on its own and just one that i cover in more detail in my operations management course plug of course so much of this whole sales and operations planning process is done with the help of big software packages now and the most important type is materials requirements planning mrp sometimes more generically known as resource requirements planning rrp the boundaries of the role of such software isn't fixed but essentially sits in the middle taking in inputs of demand forecasts and available resources making rough and detailed work material and capacity plans allowing us to view various scenarios and plans to take the actions of buying materials allocating resources and doing the work [Music] [Applause] [Music] you