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Sales and operations planning based on a modularized view of supply chains: Supporting process industries and discrete manufacturing industries
Linköping University, Department of Management and Engineering, Production Economics. Linköping University, Faculty of Science & Engineering.
2017 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The purpose of this dissertation is to propose a framework for sales and operations planning (S&OP), which is based on a modularized view of supply chains. The framework should support both process industries and discrete manufacturing industries in their quest for performance. S&OP has been highlighted in this framework due to its essential role in integrating different functions within a company and integrating a company with its supply chain partners (referred to as horizontal integration), and linking different planning levels in a company (referred to as vertical integration). As an integrator, S&ÖP influences companies’ performance.

Originally, S&OP was developed as a generic process but still in line with the requirements of discrete manufacturing industries. The specific requirements of process industries have not been emphasized in this process to the same extent. In order to suggest a modularized S&OP framework for both process industries and  discrete manufacturing  industries, a systematic literature review is performed to understand the specific characteristics of S&OP in process industries. As a result, the importance of continuity/discontinuity of materials and its influence on the required production processes are highlighted. This indicates that the production process in process industries is actually a hybrid of continuous production and discrete production, whereas the discrete manufacturing industries often only deploy discrete production. Continuous production has specific characteristics that would be beneficial to include in the S&OP process; nonetheless, this is in contrast to the view in the literature that considers S&OP a generic process. Generic here means that S&OP is independent of the context in terms of, for example, the industry in which it is implemented. This issue is investigated in this dissertation by identifying the requirements, which can be considered in the S&OP of process industries as add-ons to the generic S&OP. In addition to this, two other concepts addressing the properties of the production process are identified as important in planning and control, including S&OP. One addresses the level of repetitivity of the production process in response to the market demand, and the other concerns the trigger of the production flow. The three concepts are related to three different types of decoupling points and are the basis for a typology developed herein that provides a modularized view of supply chains. The application of the typology to S&OP leads to a modularized S&OP framework applicable to both process industries and discrete manufacturing industries. The modularized view of supply chains has been long emphasized as an effective and efficient way to support companies’ performance and their competitive position. The typology and the S&OP framework are developed through conceptual research methods.

To study how the modularized S&ÖP framework is related to companies’ performance measures, different performance measures (including sustainable performance measures) at the S&OP level are extracted from the literature. The performance measures are then classified according to the typology, and linked to strategic performance attributes. Aligning performance measures at S&OP levels and strategic performance attributes would help in enhancing companies’ performance. Sustainable performance measures are included in this classification to provide additional support for companies’ performance. Finally, this approach in classification of  performance measures is studied in four case companies, and the empirical performance measures are linked to the companies’ strategic performance attributes and competitive strategies. The results of this empirical study have, to some extent, verified the results from the classification of performance measures based on the literature.

This dissertation contributes to the development of knowledge in S&OP. First, it identifies three key concepts in planning and control of manufacturing companies. Second, it investigates how S&OP should be tailored to the specific characteristics of companies and their supply chains. The modularized S&OP framework developed in this dissertation is based on the three identified concepts. This framework provides a foundation for fulfilling the supply chains needs by suggesting decision-making processes, planning techniques, and performance measures for different modules. More specifically, this work investigates how S&OP should be designed and implemented in process industries, which has not been extensively studied before. Third, this dissertation shows how S&OP level performance measures can be selected in line with the specific characteristics of supply chains. Finally, by integrating the sustainable performance measures in the S&OP process, this dissertation expands the scope of S&OP and its potential in supporting companies’ performance.

Place, publisher, year, edition, pages
Linköping: Linköping University Electronic Press, 2017. , p. 83
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1803
Keywords [en]
Sales and operations planning, Decoupling point, Performance measure, Process industry, Discrete manufacturing industry
National Category
Production Engineering, Human Work Science and Ergonomics Environmental Management Business Administration Other Engineering and Technologies not elsewhere specified Other Mechanical Engineering
Identifiers
URN: urn:nbn:se:liu:diva-133243DOI: 10.3384/diss.diva-133243ISBN: 9789176856437 (print)OAI: oai:DiVA.org:liu-133243DiVA, id: diva2:1056853
Public defence
2017-02-03, ACAS, A-huset, Campus Valla, Linköping, 13:15 (English)
Opponent
Supervisors
Available from: 2016-12-15 Created: 2016-12-15 Last updated: 2017-04-11Bibliographically approved
List of papers
1. Sales and operations planning in the process industry: A literature review
Open this publication in new window or tab >>Sales and operations planning in the process industry: A literature review
2017 (English)In: International Journal of Production Economics, ISSN 0925-5273, E-ISSN 1873-7579, Vol. 188, p. 139-155Article in journal (Refereed) Published
Abstract [en]

This paper provides a systematic literature review of Sales and Operations Planning (S&OP) in process industries. The aim is to investigate the present state of S&OP in process industries in comparison to discrete manufacturing industries and to identify the desired future state of the S&OP process based on the specific characteristics of process industries. The findings of this paper show that this issue has not received much attention in the academic world. Hence there is a need for conceptual models with focus on process industries’ specific characteristics. Process industries are actually hybrids of continuous production and discrete production (respectively, upstream and downstream of the discretization point) and the specific characteristics of process industries are related to the continuous production part. Thus, in this paper, the characteristics upstream of the discretization point are investigated and the integration of them in the S&OP process of the process industries is stressed.

Place, publisher, year, edition, pages
Elsevier, 2017
Keywords
Sales and operations planning, Process industry, Discretization point
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-106705 (URN)10.1016/j.ijpe.2017.03.006 (DOI)000401381300013 ()
Note

The original title in manuskript fiorm of this article was Sales and operations planning in the process industry.

Funding agencies: Swedish Foundation for Strategic Research (SSF)

Available from: 2014-05-19 Created: 2014-05-19 Last updated: 2017-06-13Bibliographically approved
2. A modularised typology for flow design based on decoupling points - a holistic view on process industries and discrete manufacturing industries
Open this publication in new window or tab >>A modularised typology for flow design based on decoupling points - a holistic view on process industries and discrete manufacturing industries
2016 (English)In: Production planning & control (Print), ISSN 0953-7287, E-ISSN 1366-5871, Vol. 27, no 16, p. 1344-1355Article in journal (Refereed) Published
Abstract [en]

Management of production activities covers a wide range of decisions. In this paper, a modularised approach is suggested that, through configuration, generates a case-specific flow design. The approach is based on identification of decision categories that are generic and fundamental in the flow design, covering both discrete manufacturing industries and process industries. Each decision category identifies a unique property of the flow which changes at a particular point: this is termed a decoupling point. A three-dimensional modularised typology is developed by combining three different decision categories. Cases from the steel industry and the tooling industry are used to illustrate how the typology can be applied. The modularised approach provides a typology for the application of both qualitative and quantitative methods for flow management, including planning, control and performance management.

Place, publisher, year, edition, pages
TAYLOR & FRANCIS LTD, 2016
Keywords
Typology; decoupling point; planning and control; process industry; modularisation
National Category
Production Engineering, Human Work Science and Ergonomics
Identifiers
urn:nbn:se:liu:diva-132245 (URN)10.1080/09537287.2016.1220649 (DOI)000384468200004 ()
Note

Funding Agencies|Swedish Foundation for Strategic Research [PIC-LI]; Process Industrial IT and Automation (PiiA) - VINNOVA; Swedish Energy Agency, Formas; Swedish industry [2014-05110]

Available from: 2016-10-24 Created: 2016-10-21 Last updated: 2017-11-29
3. A modularized framework for sales and operations planning with focus on process industries
Open this publication in new window or tab >>A modularized framework for sales and operations planning with focus on process industries
2016 (English)In: Production & Manufacturing Research, ISSN 2169-3277, Vol. 4, no 1, p. 65-89Article in journal (Refereed) Published
Abstract [en]

This paper suggests a modularized sales and operations planning (S&OP) framework, consisting of content and process. The framework’s content is based on a typology of decoupling points in which the effect of decoupling points on the decision variables in S&OP is studied. The framework’s process takes a step back and addresses the need for a more elaborate design to precede the operational use of S&OP content for different production contexts. The framework supports both process industries (PIs) and discrete manufacturing industries (DIs), and recognizes their specific requirements and reflects them in their S&OP. The differentiating characteristics of PIs and DIs are emphasized through three different decoupling points, namely: discretization decoupling point, control mode decoupling point, and customer order decoupling point. The suggested framework aims to fill the gap in the literature regarding the lack of aggregate planning processes that match the PIs’ specific requirements by reflecting the differentiating characteristics of PIs in S&OP.

Place, publisher, year, edition, pages
Taylor & Francis, 2016
National Category
Economics and Business Other Mechanical Engineering Software Engineering
Identifiers
urn:nbn:se:liu:diva-133240 (URN)10.1080/21693277.2016.1200502 (DOI)
Available from: 2016-12-15 Created: 2016-12-15 Last updated: 2018-01-13Bibliographically approved
4. S&OP related key performance measures with integration of sustainability: a decoupling point based and modularized view on supply chains
Open this publication in new window or tab >>S&OP related key performance measures with integration of sustainability: a decoupling point based and modularized view on supply chains
2017 (English)In: International manufacturing strategy in a time of great flux / [ed] Louis Brennan, Alessandra Vecchi, Cham: Springer, 2017, p. 197-233Chapter in book (Refereed)
Abstract [en]

Key performance measures (KPMs) play an important role in the management of supply chains. An important integrator of the supply chain management is Sales and Operations Planning (S&OP) that connects the strategic and operational plans. S&OP usually impacts supply chain performance through the management of resources and customer satisfaction. This paper suggests a new classification for S&OP-related KPMs. The classification follows a typology of decision categories which are based on decoupling points. The typology supports a modularized approach to supply chain design and provides the possibility to select the KPMs according to the decision criteria of each module. The KPMs are further linked to the SCOR performance attributes to provide the link to the companies’ strategic directives and the strategic conflicts which appear in the modules of the typology are discussed. The sustainable KPMs have also been included in order to provide opportunities for improved sustainable performance. The integration of sustainable KPMs helps in creating competitive advantages for companies through development of capabilities which are beneficial but hard to replicate by competitors. The paper ends with an example that illustrates how the classification can be applied to a case company.

Place, publisher, year, edition, pages
Cham: Springer, 2017
Series
Measuring Operations Performance, ISSN 2363-9970
Keywords
Key performance measures, Sales and operations planning, Sustainability, SCOR model, Decoupling points
National Category
Business Administration Other Mechanical Engineering Environmental Management Transport Systems and Logistics Social Sciences Interdisciplinary
Identifiers
urn:nbn:se:liu:diva-133242 (URN)10.1007/978-3-319-25351-0_10 (DOI)9783319253503 (ISBN)9783319253510 (ISBN)
Available from: 2016-12-15 Created: 2016-12-15 Last updated: 2018-01-13Bibliographically approved

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