Supply Chain Planning

Establish more resilient and agile supply chain planning processes

Scenario Planning Yields Resilient and Agile Supply Chain Planning

The challenge for supply chain planning leaders coming out of the COVID-19 disruption is to create forward-looking supply chain planning processes.

In times of extreme uncertainty, rely on scenario planning (versus traditional forecasting) to prepare and improve supply chain planning decisions.

Supply chain planning leaders: Download our scenario planning guide to identify and prioritize critical driving forces, create and communicate scenarios and continuously revise plans.

The scenario planning guide includes:

  • Roles and responsibilities chart for a scenario planning exercise
  • Scenario development tool
  • Scenario action planning guidance

Download the Supply Chain Scenario Planning Guide

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    The job description of supply chain planning leaders today looks totally different than 10 years ago. It’s no longer enough to provide copious amounts of data — supply chain planning leaders must use the data to draw conclusions about future risks and opportunities.

    Marko Pukkila

    Vice President and Team Manager, Gartner for Supply Chain

    Greater demands on supply chain planning leaders

    In 2020, supply chain planning was challenged by high volatility in demand and supply globally. The COVID-19 disruption revealed many weaknesses in supply chain planning capabilities.

    While fundamental supply chain planning processes remain the same, supply chain planning leaders are under increased pressure to drive supply chain planning performance. Business leaders are asking for supply chain planning to be more resilient and agile to demand changes and supply.

    Supply chain planning leaders have responded by accelerating the frequency of supply chain planning — S&OP more than one time per month, S&OE daily. But most supply chain planning leaders lack the bandwidth to develop plans for business climates different from the current environment.

    60% of companies are dissatisfied with the fit between their supply planning objectives and supply planning capability.
    72% of companies with a physical supply chain are at Stage 3 or below in their supply chain planning maturity.

    Building supply chain planning capability

    With COVID-19 supply chain impact in mind, the challenges your business faced were, and will continue to be, different than those in the past.

    Those companies that had a robust supply chain planning processes for evaluating business risks and opportunities had a headstart in COVID-19 response.

    Now, all supply chain planning leaders must balance and adapt supply chain planning processes to fit short-term and midterm decision making.

    Companies currently at early-stage maturity in supply chain planning should shift from operating in "defensive mode" to intentionally driving business growth, in order to grow the maturity of the supply chain planning capability.

    72% of companies with a physical supply chain are at Stage 3 or below in their supply chain planning maturity.

    Supply chain planning insights you can use

    Supply chain planning delivers business benefits of improved profit, revenue, cash flow and customer service through multiple processes that span portfolio & inventory management, demand & supply planning and S&OP. Maximize these business benefits with Gartner.

    Future of Supply Chain: 5 Trends to Act on Now

    Discover the supply chain leader's new imperatives and get specific recommendations to reset supply chain strategy and operations.

    9 Skills That Fuel Digital Supply Chain Planning

    Identify 9 must-have skills of data scientists and engineers needed to support digital supply chain planning.

    7 Steps to Implement Supply Chain Planning Technology

    Follow this 7-step plan to successfully implement supply chain planning technology, including narrowing project focus, tackling data issues, building support and working with third parties.

    Questions about becoming a Gartner client?

    Gartner Supply Chain Symposium/Xpo™

    Join the world's most important gathering of CSCOs, supply chain executives along with Gartner experts to transform and innovate your supply chain strategy.

    Moving from made-to-stock (MTS) process to made-to-order (MTO) process achieved $8 million in inventory redutction.
    Client Success Story

    Supply Chain Strategy for Optimal Inventory

    A large enterprise construction company’s regional supply chains were operating at cross-purposes, due to the lack of governance from the global center. Gartner’s expertise in demand and supply planning helped the client achieve $8 million in inventory reduction.

    Gartner Supply Chain Top 25 for 2021

    See the 17th annual ranking of the world’s superior supply chains to learn the standard for supply chain excellence.

    Supply Chain Planning FAQs

    • Supply chain planning (SCP) is the forward-looking process of coordinating assets to optimize the delivery of goods, services and information from supplier to customer, balancing supply and demand. An SCP suite sits on top of a transactional system to provide planning, what-if scenario analysis capabilities and real-time demand commitments, considering constraints. 
    • Supply chain planning strategy, organization design & talent: Design, implement and communicate supply chain planning strategy and organization structure; recruit and motivate talent.
    • Supply chain planning process excellence & metrics: Align supply chain planning strategy and execution; determine performance metrics and processes.
    • Cost optimization & business value: Drive cost optimization, working capital and growth investment initiatives via effective supply chain planning.
    • Personal effectiveness of the supply chain planning leader: Increase personal influence on the CSCO and other supply chain and commercial stakeholders.
    • Supply chain planning technology & digital transformation: Identify, evaluate, select, adopt and maintain supply chain planning technologies.
    • Head of supply chain planning: Advance the maturity of supply chain planning processes.
    • Head of sales and operations planning (S&OP) and integrated business planning: Design, define and align the S&OP process.
    • Head of demand planning: Develop and orchestrate a demand-driven value network throughout your business in order to optimize costs and forecast accurately. 
    • Head of supply/inventory planning: Effectively assess capability availability and manage an ever-growing network of indirect suppliers via innovative technology.
    • Step 1) Shortlist the most critical supply chain planning capabilities the function needs to remain competitive for the foreseeable future. These might include competencies such as curiosity, collaboration or data-driven decision making. Then focus supply chain planner recruitment efforts on targeted talent pools.
    • Step 2) Define supply chain planning career paths that are lateral within the supply chain planning function and across other supply chain functions. Avoid traditional, hierarchical career paths as they’re no longer enough to engage and retain the average supply chain planner, especially for millennial and Gen Z talent.
    • Step 3) Foster skills development in the supply chain planning function via experiential learning interventions (like stretch assignments or job rotations) and relationship-based learning (like mentorship programs or peer best practice sharing).
    • Step 4) Tailor performance management practices for the supply chain planning function. For example, give a supply chain planner who lacks experience leading projects the opportunity to revamp the S&OP process.

    Demand planning is the development of a consensus-driven demand plan that optimizes the balance between market opportunity and supply network capability. Demand planning enables organizations to make more accurate demand forecasts for a product or service, increasing their efficiency in producing and delivering the product to the customer's satisfaction.

    Sales and operations execution (S&OE) is a weekly cyclical multistep process that involves at least four subprocesses or steps running in parallel with an underlying financial-alignment process. These subprocesses include a merchandising review, a demand review, an inventory plan and gap reconciliation, and an executive S&OE meeting.

    Support for supply chain planning leaders

    Gartner provides trusted insights and objective advice to help supply chain planning leaders establish more resilient and agile supply chain planning processes.