Question

In which step in the SOP cycle do we match supply and demand and assess financial implications

1. Demand planning
2. Finalize plans
3. Supply planning
4. Reconcile plans

Answer 1

The answer to the question is : D. Reconcile plans

SOP stands for "Sales and operations planning". It is an aspect of supply chain management .One aspect of SOP is planning activities as statistical forecasting of the demand and supply that can produce excellent results. Sales and operations planning is typically led by senior management. It is a part of monthly activity in organiasations.

Various steps of the SOP cycle are explained hereunder:-

1. Demand planning- Understand and forecast sources of demand, one time sales, new product, impact of new marketing strategy, economic conditions and so on.
2. Finalize plans- It is the final stage at which the SOP plan is implemented.
3. Supply planning- How the demand would be fulfilled ie Inventory level, logistics, supply behaviour etc are discussed here.
4. Reconcile plans- Here matching of supply and demand plans is carried out.