Home' MHD Supply Chain Solutions : MHD Nov-Dec 2015 Contents The demand review is about maintaining the
clinician base and re-optimising activity plans.
The outputs are a revised activity plan to ensure
continued patient acquisition, as well as gener-
ating forecasts by doctor, by site, and by type of
procedure, for the next 24 months.
The traditional supply review is replaced with
resource reviews -- in this case, nursing, admin-
istration, scientific, and clinical -- all based on
the updated demand plan, with the focus on
making sure the right staff profile is available at
the right time, and in the right place both in the
medium and long term.
Heads of department meet in the manage-
ment business review, which is predominantly a
revenue and cost review, after which the finan-
cial projections are rolled up in preparation for
the board meeting.
Scientific research model
Probably the most unusual of environ-
ments to implement an integrated business
planning process in recent years is a scientific
Some of the different scenarios that this
model has to deal with are:
• Understanding and matching the required
balance of research capabilities to the strate-
gic goals of the organisation, the research pri-
orities of its key stakeholders and the funding
• Successfully generating cash to be able to
fund the organisation through grants, collabo-
rative arrangements with other scientific insti-
tutions and partnerships with industry.
• Purchasing and maintaining scientific equip-
ment and infrastructure.
• Identifying individuals with the right scientific
qualifications and experience to conduct
• Ensuring that quality and quantity of research
outcomes enhance the reputation of the
organisation and its employees.
• Increasing the collaboration between the core
research platforms to most effectively utilise
the scientific assets of the organisation.
However, the steps taken are actually not
too far removed from a traditional model;: they
have a strategy, they develop new things, in this
case new research areas and platforms (portfo-
lio review), they need to generate and manage
demand (marketing and funding review), and
they need to cost-effectively supply people
and equipment to meet that need (supply and
What are the common themes?
Even in industries that, on the surface, seem
dissimilar to a traditional manufacturing envi-
ronment, there are common elements, and
therefore lessons to be gleaned. The common
themes in these examples are aligned with what
we would expect to see in a more 'traditional'
• Strategy remains at the heart.
• There is an acute awareness of where uncer-
tainty and complexity lie.
• Perhaps most importantly, demand is
defined as what is important to each indi-
vidual organisation, and supply is defined
as what is needed to meet that demand
From this, we can establish a common set of
questions or themes that apply equally well in
every industry and company. They are:
• Where does the greatest reward-uncertainty
in continuing to grow the organisation sit?
• Where is the 80:20 in on-going demand gen-
eration, and where is the greatest volatility?
• What are the primary cost drivers in being
able to deliver that demand?
• How can the financial projections best reflect
the above, and be kept visible in the process?
• Is the current model flexible enough to
evolve, or indeed rapidly change, to meet
changes in circumstance, as well as re-cali-
brate and re-align back to strategy?
It seems it does not matter whether a
company is making widgets or providing
services, the value in deploying an IBP process
is great. Folding these questions into your
S&OP/IBP process is the key to taking your
process to the next level of evolution and
benefit realisation. When it comes to your
current IBP process, are you asking the right
questions to empower the process?
Implications for a manufacturing
& distribution environment
Manufacturing companies can learn a lot from
these examples of successful non-manufac-
turing IBP implementations, and turn previous
weaknesses into strengths by re-examining
their own IBP process, beginning with the very
First and foremost, is strategy driving the
process? Regardless of industry, this is key.
Figure 3. An example medical services model.
Figure 4. An example scientific research model.
MHD SUPPLY CHAIN SOLUTIONS --- NOVEMBER / DECEMBER 2015
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