Sales and operations planning (S&OP) sits at the center of modern supply chain and logistics businesses as a critical tool that aligns demand, supply, and financial goals into a single, disciplined process — and turns strategy into action.
“I would really advise virtually every supply chain organization to implement S&OP,” says Lori Gipp, the vice president of product management for logistics software provider TransImpact.
Although each department within a company — from sales to operations to finance — plays a vital role, goals and personalities differ between stakeholders. S&OP brings all those disparate pieces together and points them in the same direction toward a common outcome.
Removing Roadblocks
The first step on the S&OP journey is to ensure everyone is aligned and that there aren’t any gaps in understanding between stakeholders and departments. That starts with ensuring everyone is working from a single dataset, allowing teams to speak a common language with numbers they all trust.
“It’s about getting everything in one place, so you can spend more time analyzing and less time having internal friction about your data,” says TransImpact S&OP product owner Lisa Baber.
It’s also important to ensure that everyone has a voice at the table, she adds. If the finance department isn’t part of the conversation, there’s no way to manage cash flow. If sales isn’t there, there’s no way to set realistic demand expectations. And if operations is left out, there’s no way to determine what can actually be produced, stored, and delivered. Ultimately, it’s about breaking down barriers so that everyone can stay well-informed throughout the decision-making process.
When S&OP Breaks Down
S&OP most often unravels for two reasons: persistent mistrust in the underlying data that turns planning into a debate over whose numbers are “right,” and a lack of executive buy-in that leaves teams stuck in “analysis paralysis,” rather than empowered to make forward-looking, fact-based decisions.
“What S&OP does is look forward, find the problems and solve them before they start, and to do that, you have to have a problem-solving mentality,” says Gipp.
Without that mindset — and leaders who are willing to put facts on the table and make hard calls — the process quickly gets buried by politics, bias, and endless requests for more analysis instead of action.
Creating a Cadence That Works
Getting everyone on the same page also means there are clear, shared expectations around regularly scheduled check-ins.
“The first thing you have to understand is what type of time everybody wants to devote to this,” says Baber.
From there, it’s important to determine how often teams will meet so the cadence works with existing schedules and workflows. Initially, that may mean agreeing to a bare-minimum commitment, such as a monthly meeting with defined time blocks for each function and then building from there as the process proves its value and reduces day-to-day fire drills.
Over time, that consistency allows S&OP to shift from reacting to today’s problems to planning ahead. Less-disrupted organizations can often operate on a quarterly rhythm, while more complex, fast-moving businesses like retail often require a monthly cadence to stay ahead of demand swings and supplier changes.
Establishing One Version of the Truth
At its core, S&OP depends on establishing a single, agreed-upon version of the truth, with one shared set of numbers that every stakeholder can see, interpret in context, and execute against with confidence. As Gipp points out, having multiple versions of the truth means that someone is always going to be working from incorrect assumptions, which only creates confusion and conflict.
“If people can’t see that core data, all they’re going to do is squabble,” she explains. “It’s probably one of the biggest things that makes S&OP ineffective, because nobody likes to go to those meetings.”
When teams do align around a single set of numbers, that clarity extends far beyond the meeting itself. Sales, operations, finance, and executives gain a shared understanding of tradeoffs and the plan they’re collectively committing to over the next several months. That shared plan then becomes the foundation for execution across the business, making it so decisions around inventory, service levels, capital investments, and resource allocation are made deliberately and collaboratively.
Finding the KPIs That Drive Alignment
Once everyone has agreed on data, scheduling, and shared goals, the next step is to identify the right KPIs, so progress can be accurately tracked and root causes identified when roadblocks arise. This doesn’t mean inventing new metrics, but aligning the core KPIs that each function already uses, so they reinforce one another, reveal meaningful tradeoffs and support better, faster decision-making across the organization.
While each department may be accountable to different metrics in their respective roles, those KPIs still need to connect back to shared outcomes, like service levels, margin, and profitability, so that S&OP functions as a unifying process rather than a collection of competing priorities.
That alignment is especially critical when KPIs naturally pull teams in different directions, such as sales pushing for higher volume, while supply chains work to control inventory and costs. In those cases, S&OP often becomes the only forum where those tensions can be surfaced, quantified, and resolved in a way that supports the whole business.
Keeping Everyone Accountable
Keeping S&OP on track ultimately comes down to accountability, not just for hitting targets, but for following through on past decisions, understanding why outcomes diverged from the plan, and creating a culture where teams can review what happened, learn from their mistakes, and make better, fact-based decisions going forward.
It also helps to create a decision priority log, says Gipp, where key decisions that need to be made are recorded and tracked. That structure empowers stakeholders to act independently and confidently within the framework of shared goals.
“It gives people more confidence to make a decision that’s not always visible to the CEO,” Gipp adds. “It’s easier to get accountability there, because you’re not exposed as much, especially if something is wrong.”
Equally critical is having executives who know when to be hands-on and when to step back. When something does go wrong, leaders have a choice: punish the person who made the mistake or teach them how to do it right the next time. More often than not, keeping S&OP on track comes down to leaders who opt for the latter.
Resource Link: https://transimpact.com/solutions/sales-operations-planning/