Supply Chain Management Blogs by SAP
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The Business Problem

Buy low sell high! Not so easy with complex finished good definition and planning.

In the mill products industry, the same raw material or WIP (like steel or cable wire of a certain grade) can be used to produce multiple finished products. Furthermore, the companies that need to balance the demand and supply for their end products sometimes end up needing to buy or sell WIP from or to the open market (like billets and blooms). However, most times these decisions are based on a rule of thumb or tribal knowledge, rather than solid data.

The Solution to the Problem

Maximize your profit using real time data driven decisions based on the latest cost and market prices.

A planning tool which can do quick what-if analysis and advise the business users on the most profitable product mix while considering the demand priorities and supply constraints would be ideal for such a situation.

SAP Integrated Business Planning (IBP) for Sales and Operations Planning (SOP) does the trick. With its single data model for demand, supply and finance on a highly intuitive and user friendly web or Excel interface powered by the power of HANA, SAP IBP for Sales and Operations can help Mill companies quickly make these critical business decisions.

SAP IBP Sales and Operations enables customers to model different costs, prices and constraints based on various supply chain models. These models can be used in different scenarios to compare the results to maximize profitability while creating a feasible supply plan. SAP IBP for sales and operations also enables the different stakeholders like finance, demand planners, supply planners and executives to explore options, socialize the point of views and come to a consensus decisions using JAM, SAP’s built in collaboration platform.

Celluloso Arauco overcomes their challenges with IBP sales and operations

Celluloso Arauco leveraged SAP IBP for sales and operations to streamline their forecasting process enabling them to perform what-if scenario analysis and strategic planning. They decreased data consolidation time from 7 to 2 days.

Diego de la Maza, Arauco’s Supply Chain Director said: “SAP´s Integrated Business Planning for sales and operations solution helped us to improve our data quality and shorten our planning cycle considerably, leaving us more time for Analysis and Scenarios.”

Contact me at to see a demo or learn more about how SAP IBP for sales and operations can solve Mill products industry specific scenarios.

To learn more check out: Getting started: What is SAP Integrated Business Planning?