Executive Engagement

and S&OP
By Patrick Bower

E x ecuti v e S u m m a r y | Executive engagement is considered one of the most important components of an

effective sales and operations planning process, but it is rarely defined. This creates an expectation of commitment—a
perceived level of executive involvement but without clarifying or establishing any of the specific baseline behaviors that
are known to best influence S&OP and yield optimal outcomes. This is a conundrum.

Pat r ic k B owe r | Mr. Bower is Senior Director, Global Supply Chain Planning & Customer Service at Combe
Incorporated, producer of high-quality personal care products. A valued and frequent writer and speaker on
supply chain subjects, he is a recognized demand planning and S&OP expert and a self-professed “S&OP geek.”
Prior to Combe, he served as the Practice Manager of Supply Chain Planning at a boutique supply chain consulting
firm, where his client list included Diageo, Bayer, Unilever, Glaxo Smith Kline, Pfizer, Foster Farms, Farley’s and
Sather, Cabot Industries, and American Girl. His experience also includes roles at Cadbury, Kraft Foods, Unisys, and
Snapple. He has also worked for the supply chain software company, Numetrix, and was Vice President of R&D at
Atrion International. He was recognized three times by Supply and Demand Chain Executive magazine as a “Pro to
Know,” and Consumer Goods Technology magazine considered him one of their 2014 Visionaries. He is the recipient
of the inaugural IBF’s Excellence in Business Forecasting and Planning Award.

N
early every S&OP success
story speaks of engagement
by the executive team as a
core element of the implementation.
It is universally accepted as one of
the most important precursors of
positive results. “Lead from the top”
is a common S&OP axiom, yet the
expression “executive engagement”
is often nothing more than a vague
utterance—offered like a solution
unto itself. It assumes the listener
already knows the meaning of the
expression. And in my experience,
the one guaranteed way to make
something utterly useless is to leave it
painfully vague.
Truth be told, I myself guilty of this
first-degree arrogance by assumption.
In my career, I have offered up this same
amorphous expression of “executive
engagement” as a success factor
on numerous occasions, especially
while working as a consultant, when I
would tell executives to “show up and
model the behaviors” they wanted
out of the process—without offering
any corresponding examples of the
behaviors that matter most. If executive
engagement is an antecedent of S&OP
success, isn’t it important to define
what such “engagement” looks like in
those processes that are successful?
On the few occasions when I was
asked to be more specific about the
type of executive behaviors required to

Copyright © 2016 Journal of Business Forecasting | All Rights Reserved | Summer 2016 | www.ibf.org 9
make S&OP successful, I would suggest
that consistency and commitment
were most likely to influence change.
Just as parents set expectations for
their children, executives set the tone
for S&OP success—or lack thereof—
based on the consistency of their
actions. By its very nature, S&OP is a
repetitious process that can be a grind
and seem ponderous at times. The
simple act of showing up at the various
process step meetings each month
demonstrates a huge commitment
by the executive. Whatever the level
or type of executive engagement,
even a trifling amount, it needs to be
consistent and dependable.
“We are what we repeatedly do.
Excellence, then, is not an act,
but a habit.” —Aristotle
Of course, purists will question
why there is any flutter regarding
executive involvement. They will say,
“Sure, executive involvement and
sponsorship is expected.” According
to standard S&OP design, executives
are supposed to lead the process, and
each S&OP step meeting is intended
to have an executive in charge or
chairing the proceedings. The Demand
Consensus/Review meeting should
be led by the executive head of sales;
the Supply Review meeting, by the
executive head of operations; the pre-
S&OP meeting, by the executive head
of finance; and the Executive Review
meeting, by the CEO/president/
general manager—the lead executive
for the business (or the business unit).
This is all S&OP 101, by the book. The
real key to executive engagement,
however, lies not in just showing up but
in understanding the subtle difference
between executive involvement vs.
commitment. I love leveraging an old
saying to help clarify this distinction:
10 Copyright © 2016 Journal of Business Forecasting | All Rights Reserved | Summer 2016 | www.ibf.org
“The difference between involvement
and commitment is like ham and
eggs. The chicken is involved; the pig
is committed.” When it comes to S&OP,
we need executives to be the pigs!
Executives who are committed to
S&OP are all-in. They embrace the S&OP
process for the opportunity it affords
to drive improvement throughout
multiple planes of the organization.
Most importantly, their involvement
is obvious to those they are leading in
the process.
The non-pigs—the uncommitted
executives—often delegate their role
in the process, creating a potential
point of failure, as few employees will
commit themselves more than their
leadership is willing to commit. Even
worse, sometimes executives will
unintentionally model behaviors that
undermine the process, effectively
introducing a net negative impact into
the process. Executive engagement
requires far more than just showing up
each month. Executive behavior and
commitment matters—a lot.
So, to answer the question, “Isn’t
it important to define such engage­
ment?” I give you eight behaviors that
I have observed and, that, in my view,
offer the most benefit to the S&OP
process.
Training—Executives need to be
fully trained in the S&OP process and
its expectations. Period. In fact, make
that exclamation point! In the most
successful S&OP implementations,
companies that emphasized executive
training reaped the greatest benefit
from the process. Training helps
executives understand the process
and its expectations, and also what
is required of all participants in each
step of the process. As a consultant, I
was routinely asked to “provide a four-
hour summary course on S&OP” for
the executive team, and I pushed back
strongly. I understand the difficulty
of getting all the executives into a
room at one time, but if the value of
S&OP is to be fully realized throughout
an organization, all members of the
executive team need to put in their
time and get full training, ideally over
the course of multiple days to imbed
the process approach thoroughly.
Not only does training present the
first opportunity to demonstrate
commitment and consistency to
the process, it also assures fidelity
within the process—helping the
executive stay true to S&OP process
requirements. The alternative never
results in a positive outcome, in my
experience it always followed that
whenever the executive team opted
out of any S&OP process element,
especially training, all other groups
would ask to opt out as well modeling
the (poor) example of their leadership.
Attendance at Meetings—Nothing
makes S&OP meetings more important
to every team member than to have
an executive in the same room with
them. The presence of an executive
elevates the perceived importance
of the meeting and its content. It is
fundamental human nature. Simply
put: having an executive in regular
attendance can dramatically improve
the quality of the meeting. All of the
other invitees will arrive at the meeting
on time and better prepared if they
know an executive is going to attend.
They will read all material in advance
of the meeting. They will anticipate
answers for potential questions from
the executive, and the meetings will
therefore run more efficiently and
professionally. Meetings are sharper
and crisper.
Executives also derive benefits from
attending S&OP process meetings.
Their participation provides direct
insight into the decision-making of the
process teams at a detailed level. This
helps executives measure and develop
confidence in both the process and
also in the outputs they will share with
their executive peers.
Although it is easy to do, the best
executives do not delegate their
participation in S&OP meetings.
Showing up matters. Of course, many
wonder if having an executive in
the meeting is wise. Some offer that
having a CEO fully involved in the
Executive Review might be a risk,
given the litigious nature of many
investor groups. Questions about what
the executive knew, and when they
knew it could come into play. Consult
your legal staff to determine if any
investor facing executives should be
engaged in detail risk and opportunity
discussions that are typical of S&OP
processes.
Similarly, others suggest executives
in the meetings might stifle dialogue—
and the reality is that it may—which is
why it is essential that the executive
in each process step meeting should
engage in a practice known as curious-
yet-quiet questioning.
Curious Yet Quiet—Executives tend
to be deeply driven individuals who
excel at making sound decisions
expediently. For this reason, it is not
uncommon for executives who are
unfamiliar with (or untrained in) S&OP
to dig right in and take over the process
meetings they attend. Instead of
directing such meetings, however, the
best S&OP executives offer questions
that help guide the group to pertinent
answers or to other equally important
questions. Executive engagement
in S&OP processes should leverage
the Socratic method of asking and
answering questions to encourage
critical thinking within the group. This
effectively teaches members of the
process team to think better and on
12 Copyright © 2016 Journal of Business Forecasting | All Rights Reserved | Summer 2016 | www.ibf.org
their own. It also fosters intellectual
curiosity about the underlying
business and supply chain.
The questions should be delivered
quietly, as follow-ups to other
questions, or answers given. They
should be curious in nature, and
open ended—requiring that group
to respond. I often ask questions
that start with the phrase “Help me
understand…” so that is obvious I am
seeking information or an answer.
Executed well, these questions can
deepen discussion and understanding.
I once asked the question “Is this
product strategic?” after a 5-minute
discussion about potential supply
scenarios surrounding a non-strategic
product. This specific question led to
another question from a team member,
and an even more enlightening
discussion about “What exactly is a
strategic product?” This is a wonderful
example of the Socratic method
applied to S&OP. The quiet and curious
questions enable group learning,
and also help to prevent meetings
from becoming mere “reporting out”
sessions, which is a sure sign of an
immature S&OP process.
Learned executives will intentionally
stray from proscribed agendas (and
bring the group back to the agenda
when done), asking probing questions
to intentionally engage the group’s
collective gray matter. I often try push
this quiet and curious questioning
concept even further by saying, “Are
we asking the right questions?” to
engage group members in deeper
discussion about the process itself.
This simple, curious-yet-quiet style
of questioning is a powerful tool for
executive engagement within the
S&OP process. Be aware that, at first,
many participants may dislike such
questioning; it can make them feel
insecure. They will ask, “Why so many
questions?” This is resistance. It is
important to push through resistance
and keep on gently probing; it
can make a huge, positive impact
throughout your business.
Clarifier in Chief—While the
Socratic method can evoke questions
and often spawn answers, more
complex issues sometimes need to
be broken down into constituent
components to be best understood.
In such instances, executives serve
S&OP process teams well when
they act as clarifiers—by helping to
simplify, illuminate, or guide the group
toward answers rather than simply
giving the process team the correct
answer. Savvy executives will help
break down, exemplify, or simplify
a complex problem or issue so that
it can be understood (and hopefully
addressed) by all participants. For
example, think of all of the potential
supply network opportunities in a
global manufacturing company, with
all of the many complex variables and
possible outcomes. Breaking down a
problem into smaller components can
add clarity to the process.
According to General Colin Powell,
“Great leaders are almost always
great simplifiers, who can cut through
argument, debate, and doubt to offer
a solution everybody can understand.”
Clarifiers serve a useful role in
meetings of any type—eliminating
confusion about discussion topics, or
defining terms, or interpreting and
distilling key issues. They can offer
examples and metaphors to help aid
in the collective understanding, or
provide a framework for decision-
making, or keep the group centered
on business priorities and strategy.
Clarifying is an approach perfect for an
executive who wants to engage in the
S&OP conversation while also guiding
the maturity of the overall process
team.
Clarifiers also help summarize
group dialogue offering questions like
“Where are we now, and what do we
do next?” They push heathy debate
and information sharing toward a
conclusion, or a solution, or to the
next steps necessary to obtain more
facts.
Reality Tester—All too often
business leaders tend to view S&OP as
a series of problems to be solved, rather
than of a set of realities that make up
a plan. Assuming the role of curious
questioner and clarifier, executives
should model active challenges to any
plan discussed in S&OP meetings—
supply, demand, financial, and
portfolio review. Active challenges
are focused, fact-based questions
regarding all of the assumptions used
in the planning process, seeking every
possible data point to push these
groups and, ultimately, the plan closer
to the current situational reality.
In consumer goods, for example,
asking four or five questions can push
a demand planning conversation
toward a more reality-based focus:
• What is the current shipment trend
of Item A?
• What is the point of sale trend of
Item A?
• What is the forecast trend of Item A?
• Is Item A subject to any impacts of
seasonality?
• Has Item A lost or gained any
distribution?
These are examples of focused,
reality-based questions—in this case
for just one item in the portfolio—
that can help your process edge closer
to a better, more realistic portrayal
of demand. This continuation of the
Socratic approach, borrowed from our
quiet-questioning discussion, is not
intended as some mere philosophical
exchange. Used strategically, active
Copyright © 2016 Journal of Business Forecasting | All Rights Reserved | Summer 2016 | www.ibf.org 13
challenges can be a very effective
device for applying a laser focus on
the facts used to assemble your plan
with each question poking or gnawing
at the realistic nature of the plan, the
data used, and the quality of inputs
and insights provided.
Occasionally asking the simple
question, “What do we know now?”
or even more substantive, “What
additional data do we need to make a
good decision?” keeps the group focus
on collecting deeper and richer facts.
Generally speaking, more facts lead to
better decisions and plans.
The executive should also be wary
of expressions like “gut feeling” and
“rule of thumb,” which run counter to
the fact-based foundations of S&OP. It
is not that these expressions should be
banned from the process; it is just that
most rules of thumb or gut feelings are
highly subjective and often factually
flawed. They are not always wrong;
they just tend not to have a solid
enough factual basis to help make
definitive decisions. An effective S&OP
process depends on realistic, best-
knowledge portrayals of the plan, not
gut feelings. Shrewd executive leaders
should help the group focus on finding
or at least digging into the facts.
In Executives We Trust—S&OP
often represents process change, and
the prospect of change quite often
sparks feelings of fear, uncertainty,
and doubt, more famously known as
the FUD factor. And this trio can be
great process killers if not anticipated
and managed well.
Process participants may fear
stepping out of the box by asking
too many questions, or the wrong
questions, or not having the right
answer. They worry about being
perceived as negative if they challenge
the assumptions in the plan. Some
worry about the potential ways that
S&OP may impact their jobs, especially
if the KPI intensive process directly
measures their performance. No one
likes being measured, particularly in
such a public way. Participants who
are new to the process, especially
those unaware of their expectations,
will often retreat into what is safe—a
comfort zone of what they know, or
what they suspect will be least likely
to expose them to risk, to get them
into trouble. They rarely tell you what
they really feel about the process,
which is why they are often called
“icebergs,” since the emotions they
show on the surface often mask their
real, much larger underlying concerns.
Executives, especially those leading
new S&OP processes, should be very
aware of the FUD factor and work
thoughtfully to encourage genuine
insights from process participants.
They need to listen, call out individuals
for encouragement and praise, act as
cheerleaders for the process, and most
importantly: keep reinforcing the
message of value and vision for the
organization.
The executive’s role is to build trust
within the group so that questions and
divergent points of view are seen as a
positive contribution to the process.
Manager of Relationships—As with
any worthwhile relationship, S&OP can
sometimes be messy. Thus it falls to the
executive sponsor of each S&OP team
to ensure a smooth-running, integrated
process by working to manage the
cross-hierarchical and cross-functional
relationships among members of the
various process-step teams, especially
if there are any conflicts or disputes. If
groups or individuals arise as obstacles,
executives need to break through such
barriers, or at least act as a mediator or
tiebreaker.
They also must serve as the critical
resource for typical leadership tasks,

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the Visibility to
like updating other members of
the executive team, summoning
additional resources as needed (such
as IT support or training personnel),
and serving as the spokesperson
for the team in the Executive S&OP
Review meeting or before a steering
committee.
Goal Tender—Finally, each exe­
cutive member of an S&OP team has
Forecasting an overarching obligation to make
Demand Consensus sure all other members of the team
remain fully engaged and informed of
Supply Policy Optimization an organization’s overall strategy and
portfolio direction. Executives need
Distribution Requirements
to keep groups focused on potential
Planning (DRP)
benefit streams, monitor progress of
Procurement and key performance indicators assigned
Manufacturing Planning to each process team, and ensure their
group remains true to the company’s
S&OP culture and values, all while promoting
an ethical working environment. The
©2014 Demand Works Co.
primary charge is to keep the group
focused on the goal and on best ways
to go about achieving the goal.
Savvy executives engaged in S&OP
operations understand that their

OUTPLAN
leadership is essential to ensuring
the overall well-being and smooth
execution of process steps within their
the Collaboration to

OUTPACE
control or sphere of influence.
Elon Musk famously said “I could
either watch it happen or be part of it.”
the Velocity to This sentiment suggests the potential

OUTPERFORM for enhancing operational excellence

comes from effective, enlightened,
and informed executive leadership of
If you aim to be a top competitor, an optimized supply sales and operations planning.
chain is a mandate. Strong executive engagement,
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competition behind. Logility’s proven three-pronged willingness to foster—critical thinking
strategy, OUTPLAN, OUTPACE, OUTPERFORM.
Protably satisfy customer demand and stay in the
skills within each S&OP process team,
winner’s circle by getting the right products at the right can be a killer combination. The
cost to the right place at the right time. best executives are not just part of
the S&OP process; they are a font of
Worldwide Headquarters: 800-762-5207 inspiration within it.
www.logility.com EMEA Headquarters: +44 (0) 121 629 7866 —Send Comments to: JBF@ibf.org

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