Forecasting and Sales & Operations Planning

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Situation

• $500M merger of two global adhesive businesses
• Serving the demanding electronics and automotive segments
• Identified $50 million in supply chain savings and synergies
• However, supply chain synergies were dependent upon integrated customer facing processes
• Customer facing processes proved difficult to combine

Actions Taken

• Analyzed historical demand patterns and key market drivers
• Developed sales forecasting process and built Excel-based forecasting model
• Defined capacity utilization metrics and reporting processes
• Combined forecasting and capacity reporting to create a reliable sales and operations planning (S&OP) process

Results

• Forecast accuracy is consistently within 3% of actual results on a monthly basis
• Customer service levels, measured as Orders On-Time In-Full, improved from 85% to 98%
• Inventory levels declined 20%
• Most importantly, the business was able to proceed with the plant consolidations and realize the supply chain savings