Framework for measuring performance of the sales and operations planning process

The purpose of this paper is to develop a framework for measuring the S&OP process performance.

The method used is a multiple case study of five companies from different industries based on data from 12 structured interviews.

The main result is a framework to measure the S&OP process. It includes concrete suggestions for organizations when developing measures to increase effectiveness and efficiency of the process. It will also help organizations to standardize measures and to enhance organizational transparency. Our results include measures for every step of the process as well as for the outcome of the process. The authors highlight the importance of cross-functional measures along with measures that focus on how to conduct the process. The framework is founded on a set of criteria on appropriate measures such as comprehensiveness, internal process efficiency, horizontal and vertical integration, internal comparability, and usefulness. The study contributes to performance measurement literature and the S&OP literature.

Validation of the framework is desirable in similar as well as other contexts. Implementation challenges should also be investigated.

The framework provides guidelines in order to measure, analyze and improve the effectiveness and the efficiency of the process.

This is the first framework for measuring the S&OP process that includes detailed measures for each step of the process, for the outcome of the process as well as how to conduct the process itself.