What is supply chain planning?

One of the areas that has been gaining the most attention in industries due to its criticality is Supply Chain Management. The increasing complexity of production chains and its consequences in high costs, disruptions, and loss of competitiveness for those who do not correctly address this challenge only occur because we do not know what the future will be like. If we knew exactly what future demand will be, how long it will take to produce 'x' products, and were certain of supplies and deliveries in certain quantities and deadlines, we could use simple arithmetic to solve our problems. But "life as it is" is not like that. Where there is uncertainty, there must be planning. While Supply Chain Management (SCM) is a broader concept that addresses all aspects of the supply chain, from planning to execution, Supply Chain Planning (SCP) is more focused on the former and is part of SCM.

Therefore, supply chain planning is the set of activities to anticipate and decide how much of each material will be supplied, in what quantity, in what form, and at what time in order to meet a future, still uncertain, demand. In short, this will give us the answers to our main decision objective: what responsiveness do we want to meet at what service level? It is precisely the imprecision and complexity that make this process full of steps and trade-offs, with various areas involved.

Bibliographies on the subject can vary slightly, even more so if we look at it from a conceptual or technological perspective. We will find many materials discussing S&OP and IBP, others focused on Demand Planning, those directed towards Operations, and so on. A reference in the area that brings together all these perspectives in a synthesis of SCP is the specialist Gerald Feigin, PhD in applied mathematics from Harvard and consultant to large company . He divides SCP into 3 main areas: Demand Planning, Integrated Sales and Operations Planning (S&OP), and Inventory and Supply Planning. Stratifying the last topic as we understand its different functions and even the applied technologies highlighted by eminences such as Gartner, we can, with a touch of poetic and consultative license, divide SCP into the following main topics:

• Demand Planning;

• S&OP/IBP;

• Inventory Planning;

• Production Planning;

• Supply Planning;

• Logistics Planning.

To learn what each of these steps entails, their applications in Supply Chain planning, the most suitable technologies to support execution, and the main practical applications of each topic discussed above, we have prepared a complete and totally free ebook for you . Click here , fill out the form, and receive your ebook immediately!

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