Why Manufacturers Need More Than Operational Planning
Daily production schedules and MRP runs are important, but they don’t answer bigger questions: Can we support that large new customer? What if demand drops in a key region? When should we add capacity? Sales and Operations Planning (S&OP) and Integrated Business Planning (IBP) sit above operational planning, and your manufacturing ERP data is the foundation.
Building a Single Set of Numbers
S&OP and IBP processes rely on one version of the truth. Manufacturing ERP provides:
- Historical shipment and order data to drive demand planning.
- Current and planned capacity across plants and lines.
- Inventory positions and constraints for key materials.
These data streams feed planning tools that generate consensus demand and supply plans reviewed in S&OP meetings.
Demand Planning and Scenario Analysis
Demand planners and sales teams use ERP-linked planning tools to:
- Build statistical forecasts based on history and seasonality.
- Layer in sales intelligence (promotions, new products, customer insights).
- Create upside and downside demand scenarios.
These demand plans become the input for supply and capacity analysis in your manufacturing ERP environment.
Supply, Capacity and Financial Reconciliation
Supply planners and operations use ERP data to:
- Check proposed demand plans against machine and labor capacity.
- Evaluate alternative sourcing, overtime or subcontracting.
- Calculate the financial impact of different scenarios (revenue, margin, capex).
Finance then reconciles S&OP outputs with budgets and targets as part of an IBP cycle.
Role of ERP Analytics and Dashboards
ERP-driven analytics support S&OP reviews with views of:
- Forecast accuracy and bias by product and region.
- Capacity utilization and projected bottlenecks.
- Inventory projections, stockout risks and working capital implications.
These dashboards turn S&OP meetings from slide reviews into data-driven decision sessions.
Final Thoughts
S&OP and IBP in manufacturing ERP connect demand, supply and finance into a single, continuously updated plan. By leveraging the rich operational data inside ERP and layering on planning and analytics, manufacturers can make confident decisions about capacity, inventory and growth—rather than reacting to surprises after the fact.