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Sales and Operations Planning Standard System 

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Sales & Operations Planning - Best Practices

Sales and Operations Planning Standard System

With Reference Software

Christopher D. Gray


The Sales and Operations Planning Standard System describes a simple set of software functions, primarily those in the areas of aggregate sales planning, aggregate supply planning, aggregate inventory or backlog planning, reporting and display of key performance and planning information, rough-cut (capacity and material) planning, and financial planning. It describes the activities that are part of a working sales and operations planning process, as well as an explanation of the assumptions and the experience that led to these functions. 

The software functions described in the S&OP Standard System include those required to support communication and decision-making focused on volume related manufacturing and supply chain issues. 

In addition it describes some of the key interfaces that must exist with other essential company functions. For example, the S&OP Standard System describes the interfaces to resource planning functions like master production scheduling and sales planning, and the interfaces to lean manufacturing functions like takt time calculations.


Soft cover - 166 pages

Reference software and documentation downloadable with book purchase

Reference software showing how the calculations of S&OP actually work is provided with the book.  This software was developed in Microsoft Excel and includes:  

  • Make-to-stock S&OP format and calculations

  • Make-to-order S&OP format and calculations

  • Finish-to-order (postponement) S&OP format and calculations

  • Rough-cut capacity plan format and calculations

  • Rough-cut capacity plan pegging format 

  • Selected graphical displays of S&OP data

The reference software can be downloaded free from the Gray Research website using the instructions provided in chapter 10 of the book. 



Sales and Operations Planning Standard System is the first book in a series on manufacturing software standards.  


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The book is organized into the following chapters.


The S&OP Process
S&OP Basics Including Calculations and Reporting
Additional Reporting Considerations
Additional Issues - Managing Change, Validation, and Linking
Rough-Cut Planning
Feeding Financial Analysis
Measures of Performance
Graphical Displays of S&OP Data
Functional Checklists
Reference Software


Some of the specific topics discussed in the book include:


Basic data needed for S&OP

  • Families

  • Family hierarchies

  • Company planning calendar

  • Time phased data






Basic calculations

  • Make-to-stock

  • Make-to-order

  • Finish-to-order

Basic reporting

  • How much history?

  • How much future visibility? 

  • Report format

Sales plan

Shipping plan

Supply plan

Inventory plan

Backlog plan

Additional data

  • Descriptive data

  • Additional time phased data

Business plan

Year-to-date (YTD) performance

Projected performance through to the end of the year

Prior sales and supply plans to provide visibility to change over time

Inventory  and backlog targets

Inventory  turnover and backlog in weeks


  • Analysis of past performance (sales, supply, inventory and backlog)

  • Assumptions about future plans (demand and supply)

  • New product development status

Managing change

  • Time fence and customer lead time

  • Validation

High/low planning

Converting to rates per day

Converting to takt time and operational takt time

  • Linking

Linking aggregate sales plans to detailed forecasts

Linking aggregate supply plans to the master production schedule

Rough-cut planning

  • Rough-cut capacity planning

  • Planning different types of resources

  • Required versus planned and maximum

  • Rough-cut material planning

Financial planning

  • Budgeting  and business planning

  • Current year revenue, margin, and profit tracking

  • Financial reconciliation and adjustment

  • Projecting future cash flows

  • Projecting inventory investment

  • Capital planning

Measures of performance


Graphical displays of S&OP data

Read Excerpts from the Book


Table of Contents

Structure of the S&OP Standard System

Chapter 1 Overview: The S&OP Process

Chapter 2 S&OP Basics Including Calculations and Reporting (excerpt from the "Basic Calculations" section)

Chapter 2 S&OP Basics Including Calculations and Reporting (excerpt from the "Basic Report Formats" section)

Chapter 5 Rough-Cut Planning

Chapter 6 Feeding Financial Analysis

Chapter 7 Measures of Performance