Integrated Business Planning

Increasing competitive pressures on most markets force companies to continuously review the effectiveness and efficiencies of their operations. Traditional approach to business planning is becoming insufficient to cope with growing requirements on operational excellence. Concept of Integrated Business Planning (IBP) -- constituting the latest development stage of well-known Sales and Operations Planning (S&OP) -- is proposed as the right response on how to master the challenges of globalized economy in this field. The thesis combines theoretical analysis of inefficiencies of traditional S&OP with applied research realized on the case from real business environment. Microeconomic optimization models are employed to demonstrate the sub-optimal outcomes resulting from the lack of cross-functional integration and potentially antagonistic incentives in business planning. Overview of latest best practices in this area further complements the theoretical part of the thesis. Empirical part of the study summarizes author's experience from leading the large scale implementation of IBP concept in the multinational company. Theoretical assumptions of financial benefits of IBP implementation are tested against empirical observations via usage of statistical apparatus. This part may also be viewed as detailed guideline describing the project of IBP implementation. As a result, integrated approach to business planning proves to bring measurable financial as well as non-financial improvements for the company.