With the help of the above tables, answer the following questions;

QUESTIONS:

1. Review the forecast line in the original S&OP grid and the new S&OP grid:

How do the plans differ? Was there an expected trend in the original forecast? Is there a trend in the new forecast?

2. Notice the Target Finished Inventory of 10 Days on hand vs. the Days on Hand calculated in the Original S&OP plan and the New S&OP plan. What is the impact of the new sales and operations plan on inventory levels?

3. Notice the Target Finished Inventory of 10 Days on hand vs. the Days on Hand calculated in the New S&OP plan. Is the new inventory level acceptable?

4. What could be done further and what is the possible impact?

5. What would you recommend at the pre-S&OP meeting?

Original S&OP Grid (For information only. No data will be input in this grid.): Scroll down Product Family: Unit of Measure: Average Product Cost per Unit: Target Finished Inventory: Flat Screen TVs 1 unit $100 10 days on hand JNotice the targeted inventory days on hand! This is an important indicator Past Periods Current Period Forecasted Periods January March April May June July August Sept October 200 210 210 210 215 215 215 SALES FORECAST ACTUAL SALES DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE CUMULATIVE % DIFFERENCE (MON 190 -10 -10 -5.00% February 200 190 -10 -20 -5.00% 200 185 -15 -35 -5.83% 205 190 -151 -50 -6.21% May 220 220 220 220 230 230 PRODUCTION PLAN ACTUAL DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE % DIFFERENCE (MONTHLY) 200 195 -5 -5 -2.50% 200 200 o -5 -1.25% 205 200 -5 -10 -1.65% 210 215 5 -5 -0.61% May 155 165 175 180 195 210 105 FINISHED GOODS INVENTORY PLAN 100 ACTUAL 95 DIFFERENCE (MONTHLY) -5 CUMULATIVE DIFFERENCE -5 % DIFFERENCE (MONTHLY) -5.0% DAYS ON HAND 10.0 PROJECTED INVENTORY COST $9,500 100 105 110 120 145 5 15 35 0 15 50 0.0% 4.9% 12.0% 11.4 12.6 $10,500 $12,000 $14,500 13.8 14.8 15.7 16.3 16.7 18.11 $15,500 $16,500 $17,500 $18,000 $19,500 $21,000 New S&OP Grid: Scroll down to see more inform Product Family: Unit of Measure: Average Product Cost per Unit: Target Finished Inventory: Flat Screen TVs 1 unit $100 10 days on hand Notice the targeted inventory days on hand! This is an important in Past Periods Current Period Forecasted Periods January February March April June October May 190 July 190 August 190 Sept 190 200 190 190 SALES FORECAST ACTUAL SALES DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE CUMULATIVE % DIFFERENCE (MON 190 -10 -10 -5.00% 200 200 190 185 -10 -15 -20 -35 -5.00% -5.83% 205 1901 -15 -50 -6.21% May 200 220 198 198 198 198 198 200 PRODUCTION PLAN ACTUAL DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE % DIFFERENCE (MONTHLY) 200 195 -5 -5 205 200 -5 -10 -1.65% 210 215 5 0 -5 -1.25% -5 -2.50% -0.61% May 110 175 183 191 199 207 215 FINISHED GOODS INVENTORY PLAN 100 ACTUAL 95 DIFFERENCE (MONTHLY) -5 CUMULATIVE DIFFERENCE -5 % DIFFERENCE (MONTHLY) DAYS ON HAND 10.0 PROJECTED INVENTORY COST $9,500 100 105 105 120 145 5 15 35 0 15 50 0.0% 4.9% 12.0% 11.4 12.6 15.3 $10,500 $12,000 $14,500 19 -5.0% 18.4 19.3 20.1 20.9 21.8 $17,500 $18,300 $19,100 $19,900 $20,700 $21,500 Original S&OP Grid (For information only. No data will be input in this grid.): Scroll down Product Family: Unit of Measure: Average Product Cost per Unit: Target Finished Inventory: Flat Screen TVs 1 unit $100 10 days on hand JNotice the targeted inventory days on hand! This is an important indicator Past Periods Current Period Forecasted Periods January March April May June July August Sept October 200 210 210 210 215 215 215 SALES FORECAST ACTUAL SALES DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE CUMULATIVE % DIFFERENCE (MON 190 -10 -10 -5.00% February 200 190 -10 -20 -5.00% 200 185 -15 -35 -5.83% 205 190 -151 -50 -6.21% May 220 220 220 220 230 230 PRODUCTION PLAN ACTUAL DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE % DIFFERENCE (MONTHLY) 200 195 -5 -5 -2.50% 200 200 o -5 -1.25% 205 200 -5 -10 -1.65% 210 215 5 -5 -0.61% May 155 165 175 180 195 210 105 FINISHED GOODS INVENTORY PLAN 100 ACTUAL 95 DIFFERENCE (MONTHLY) -5 CUMULATIVE DIFFERENCE -5 % DIFFERENCE (MONTHLY) -5.0% DAYS ON HAND 10.0 PROJECTED INVENTORY COST $9,500 100 105 110 120 145 5 15 35 0 15 50 0.0% 4.9% 12.0% 11.4 12.6 $10,500 $12,000 $14,500 13.8 14.8 15.7 16.3 16.7 18.11 $15,500 $16,500 $17,500 $18,000 $19,500 $21,000 New S&OP Grid: Scroll down to see more inform Product Family: Unit of Measure: Average Product Cost per Unit: Target Finished Inventory: Flat Screen TVs 1 unit $100 10 days on hand Notice the targeted inventory days on hand! This is an important in Past Periods Current Period Forecasted Periods January February March April June October May 190 July 190 August 190 Sept 190 200 190 190 SALES FORECAST ACTUAL SALES DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE CUMULATIVE % DIFFERENCE (MON 190 -10 -10 -5.00% 200 200 190 185 -10 -15 -20 -35 -5.00% -5.83% 205 1901 -15 -50 -6.21% May 200 220 198 198 198 198 198 200 PRODUCTION PLAN ACTUAL DIFFERENCE (MONTHLY) CUMULATIVE DIFFERENCE % DIFFERENCE (MONTHLY) 200 195 -5 -5 205 200 -5 -10 -1.65% 210 215 5 0 -5 -1.25% -5 -2.50% -0.61% May 110 175 183 191 199 207 215 FINISHED GOODS INVENTORY PLAN 100 ACTUAL 95 DIFFERENCE (MONTHLY) -5 CUMULATIVE DIFFERENCE -5 % DIFFERENCE (MONTHLY) DAYS ON HAND 10.0 PROJECTED INVENTORY COST $9,500 100 105 105 120 145 5 15 35 0 15 50 0.0% 4.9% 12.0% 11.4 12.6 15.3 $10,500 $12,000 $14,500 19 -5.0% 18.4 19.3 20.1 20.9 21.8 $17,500 $18,300 $19,100 $19,900 $20,700 $21,500