Planning the activities of a metallurgical company based on the integration of S&OP and CPFR

Abstract

Supply chain management of large metallurgical companies is complicated by working in conditions of risk and high uncertainty of activity. The traditional planning system does not allow for sufficient consistency and synchronization of the plans of structural units with each other and with the external environment of interaction. Based on the analysis of the economic planning management of the leading companies in the industry, it was found that the integrated planning system of the company currently contributes to solving these problems. The authors propose its formation based on the use of two information practices: S&OP (sales and operations planning) and CPFR (collaborative planning, forecasting, and replenishment with trading partners).

Planning the activities of a metallurgical company based on the integration of S&OP and CPFR will allow: to increase the accuracy of forecasts of demand for the range of products offered; to more effectively manage the stocks of raw materials, rolled products and metal products; to improve coordination between the functional areas of the company; to provide flexibility in production planning.

At the same time, the transformation of the planning and economic practice of a metallurgical company should take into account the risks of emerging difficulties in collecting and exchanging big data with counterparties, errors in forecasting indicators, as well as coordination of plans between integration participants, restructuring of business processes and organizational cultures of partners.