Sales & Operations Planning (S&OP) Checklist Template

Owned by the S&OP lead. Enter the date of this month’s executive S&OP meeting: every due date counts from it in working days. This template starts the cycle three working weeks before the meeting and closes it a week after. The data close comes first, because every review that follows works from last month’s actual results.

• Record the cycle, the meeting date and the people — the month of this cycle, the date of the executive S&OP meeting, the planning horizon and level, the product families in the plan, whether this cycle has a product and portfolio review, and the six people this checklist assigns
• Confirm the review dates and invitations — the dates of this cycle’s reviews and meetings set from the executive meeting date, the invitations sent, and anyone who cannot attend asked to send a deputy with authority to agree
• Review the actions carried from last month — the actions and assumptions carried forward when last month’s cycle closed, with each action’s owner and status, so each review knows what was promised and what is still open
• Close last month’s actual results — last month’s actual sales or shipments, orders and backlog, production and inventory for each product family, taken from your own systems once the month has closed, with any known data problem noted
• Measure last month against the plan — actual demand against the forecast, production against the supply plan, inventory and backlog against their targets, and customer service, by product family, with the main reasons for each large miss
• Refresh the baseline forecast — the statistical or baseline forecast rolled forward one month with the new actuals, for every product family over the planning horizon, ready for the demand review

Applies only when the first task says this cycle has a product and portfolio review. The product review comes first so that the demand review plans with the launches and phase-outs it agrees.

• Update the new product and launch plan — each product in development with its stage, launch date and the resources it needs, and any launch now at risk with its recovery plan
• Plan phase-ins, phase-outs and end-of-life products — products to be introduced, replaced or withdrawn over the horizon, with the dates when old stock should run down and new stock start, so demand and supply plan the change-over together
• Hold the product and portfolio review — the launch and portfolio changes agreed with product development, marketing and the S&OP lead, and passed to the demand review as an input

Sales, marketing and product management agree one demand plan for every family over the horizon. It is the demand you expect, before anyone limits it to what supply can make: the supply review tests it next.

• Gather sales and customer input — account plans, customer forecasts, orders in hand, business won and lost, and changes the sales team expects, by product family
• Add promotions, pricing and market events — planned promotions, price changes, launches, one-off events and market changes added to the baseline, each with the volume it is expected to add or take away
• Record the demand assumptions — the assumptions behind the demand plan, such as market growth, a customer’s ramp-up, a price change or a competitor’s move, written down so next month’s review can see which ones held
• Hold the demand review and agree the demand plan — the changes from last month’s demand plan reviewed family by family, risks and opportunities named, and one consensus demand plan agreed over the horizon, with issues that need a decision passed on

Operations and supply chain test whether the demand plan can be met with the capacity, materials and inventory available. Where it cannot, they work out the alternatives, and the executives choose between them.

• Set inventory and backlog targets — the inventory or order backlog each product family should hold at the end of each period, reviewed against last month’s performance and the service the business wants
• Check capacity with rough-cut capacity planning — the capacity the demand plan needs in each key work centre, line or site, month by month, compared with the capacity actually achieved and the most that can be made without new investment
• Check materials and supplier constraints — key materials and components with long lead times, a single source or a known shortage, and suppliers’ ability to support the plan
• Draft the supply plan for each family — production or purchasing by family and period over the horizon, built to meet the demand plan and the inventory targets within the constraints found, by levelling production, following demand, or a mix
• Hold the supply review — the draft supply plan reviewed by operations, supply chain and purchasing, with the months and families where it cannot meet the demand plan named, and the supply plan agreed for the reconciliation
• Work out the supply alternatives — each realistic way to close the gap, such as overtime, extra shifts, outsourcing, building ahead, more capacity, or meeting less demand, with its cost, effect on service and inventory, and lead time, for the executives to choose from

Finance puts the demand and supply plans into money and compares them with the business plan. This is a check of the operating plan against the business plan, not a new budget.

• Value the plans in revenue, cost and margin — the demand and supply plans converted from units into revenue, cost of sales, margin, inventory value and the main operating costs, period by period over the horizon
• Record the financial assumptions — prices, costs, exchange rates and any other assumption used to value the plans, written down so the numbers can be checked and compared next month
• Check the financial view against recent actual results — the valued plan compared with recent actual results and last month’s view, so a sudden jump in revenue, margin or inventory is explained before anyone relies on it
• Compare the plans with the business plan — revenue, margin, inventory and cash from the plans compared with the business plan or budget for the same periods, with each gap and its cause recorded
• Build scenarios for each gap — two or three ways to close each gap, such as a price change, a promotion, a supply alternative or accepting the gap, each with its effect on revenue, margin, inventory and service

The review leads meet to settle what they can between themselves and turn the rest into options and a recommendation. Only the decisions they cannot make go to the executives.

• Gather the issues from each review — the issues, gaps and decisions needed from the product, demand and supply reviews and the financial reconciliation, in one list
• Hold the pre-S&OP meeting — the S&OP lead and the product, demand, supply and finance leads settle the issues they have authority to settle, and agree options for the rest
• Write the options and recommendations — for each open issue, the options, the effect of each on revenue, margin, inventory and service, and the recommendation, with who recommends it
• Prepare the executive S&OP pack — last month’s performance, the demand, supply and financial plans by family against the business plan, the main assumptions, the gaps and scenarios, and the decisions needed, with the recommendations
• Send the pack before the meeting — the pack sent to everyone attending at least one working day before the executive meeting, with the decisions needed listed first

The executives decide: they choose between the options, approve the plan and set the actions. Nothing after the approval can be completed until the chair completes it, with Approved or Approved with changes. Not approved shows a rework task above it and leaves the approval open.

• Hold the executive S&OP meeting — last month’s performance, the plans and the gaps reviewed, a decision made on each recommendation, and the actions agreed with an owner and a date
• Rework the plan for another decision — not approved only: each point the executives raised dealt with, such as a scenario costed again, a supply alternative confirmed or the demand plan changed, and a date agreed for the chair to decide again
• Approve the plan for this cycle — Approved, Approved with changes or Not approved, with the changes or the reasons, recorded by the chair alone

One approved plan goes to everyone who works from it, so sales, operations and finance plan from the same numbers until the next cycle.

• Update the plans with the executives’ decisions — the demand, supply and financial plans changed to match each decision, and a version recorded as this month’s approved plan
• Publish the approved plan — the approved plan, the decisions and the main assumptions shared with sales, operations, purchasing and finance, with what changed since last month
• Hand the supply plan to scheduling and purchasing — the approved supply plan by family given to whoever builds the master production schedule and places purchase orders, with any capacity or material decision they must act on
• Give finance the updated outlook — the approved plan’s revenue, margin, inventory and cash used to update the financial forecast, with any gap to the business plan that the executives accepted
• Tell sales and customer teams what changed — the decisions that affect customers, such as supply limits, allocations, launch dates or phase-outs, explained to the sales and customer teams with what they should tell customers

Close the cycle: every action has an owner and a date, the assumptions to watch are written down, and what is still open is carried into next month’s checklist.

• Record each action with an owner and a date — every action from the reviews and the executive meeting entered with its owner, due date and status, so the next cycle can check them
• Record the assumptions and risks to watch — the assumptions the plan depends on most and the early signs that would show one failing, such as orders below a level or a supplier’s lead time growing, each with who watches it
• Note what to improve in the cycle — what worked and what did not in this cycle, such as late data, a review without a decision maker or a pack sent late, and one change to try next month
• Carry open actions into next month’s cycle — next month’s checklist started with its executive meeting date, and the open actions and assumptions to watch carried into it
• File the cycle’s record — the data, the plans, the pack, the minutes, the decisions and the approved plan kept together for as long as your records policy says