companies using integrated business planning

A better way to drive your business

Managing the availability of supply to meet volatile demand has never been easy. Even before the unprecedented challenges created by the COVID-19 pandemic and the war in Ukraine, synchronizing supply and demand was a perennial struggle for most businesses. In a survey of 54 senior executives, only about one in four believed that the processes of their companies balanced cross-functional trade-offs effectively or facilitated decision making to help the P&L of the full business.

That’s not because of a lack of effort. Most companies have made strides to strengthen their planning capabilities in recent years. Many have replaced their processes for sales and operations planning (S&OP) with the more sophisticated approach of integrated business planning (IBP), which shows great promise, a conclusion based on an in-depth view of the processes used by many leading companies around the world (see sidebar “Understanding IBP”). Assessments of more than 170 companies, collected over five years, provide insights into the value created by IBP implementations that work well—and the reasons many IBP implementations don’t.

Understanding IBP

Integrated business planning is a powerful process that could become central to how a company runs its business. It is one generation beyond sales and operations planning. Three essential differentiators add up to a unique business-steering capability:

• Full business scope. Beyond balancing sales and operations planning, integrated business planning (IBP) synchronizes all of a company’s mid- and long-term plans, including the management of revenues, product pipelines and portfolios, strategic projects and capital investments, inventory policies and deployment, procurement strategies, and joint capacity plans with external partners. It does this in all relevant parts of the organization, from the site level through regions and business units and often up to a corporate-level plan for the full business.
• Risk management, alongside strategy and performance reviews. Best-practice IBP uses scenario planning to drive decisions. In every stage of the process, there are varying degrees of confidence about how the future will play out—how much revenue is reasonably certain as a result of consistent consumption patterns, how much additional demand might emerge if certain events happen, and how much unusual or extreme occurrences might affect that additional demand. These layers are assessed against business targets, and options for mitigating actions and potential gap closures are evaluated and chosen.
• Real-time financials. To ensure consistency between volume-based planning and financial projections (that is, value-based planning), IBP promotes strong links between operational and financial planning. This helps to eliminate surprises that may otherwise become apparent only in quarterly or year-end reviews.

An effective IBP process consists of five essential building blocks: a business-backed design; high-quality process management, including inputs and outputs; accountability and performance management; the effective use of data, analytics, and technology; and specialized organizational roles and capabilities (Exhibit 1). Our research finds that mature IBP processes can significantly improve coordination and reduce the number of surprises. Compared with companies that lack a well-functioning IBP process, the average mature IBP practitioner realizes one or two additional percentage points in EBIT. Service levels are five to 20 percentage points higher. Freight costs and capital intensity are 10 to 15 percent lower—and customer delivery penalties and missed sales are 40 to 50 percent lower. IBP technology and process discipline can also make planners 10 to 20 percent more productive.

When IBP processes are set up correctly, they help companies to make and execute plans and to monitor, simulate, and adapt their strategic assumptions and choices to succeed in their markets. However, leaders must treat IBP not just as a planning-process upgrade but also as a company-wide business initiative (see sidebar “IBP in action” for a best-in-class example).

IBP in action

One global manufacturer set up its integrated business planning (IBP) system as the sole way it ran its entire business, creating a standardized, integrated process for strategic, tactical, and operational planning. Although the company had previously had a sales and operations planning (S&OP) process, it had been owned and led solely by the supply chain function. Beyond S&OP, the sales function forecast demand in aggregate dollar value at the category level and over short time horizons. Finance did its own projections of the quarterly P&L, and data from day-by-day execution fed back into S&OP only at the start of a new monthly cycle.

The CEO endorsed a new way of running regional P&Ls and rolling up plans to the global level. The company designed its IBP process so that all regional general managers owned the regional IBP by sponsoring the integrated decision cycles (following a global design) and by ensuring functional ownership of the decision meetings. At the global level, the COO served as tiebreaker whenever decisions—such as procurement strategies for global commodities, investments in new facilities for global product launches, or the reconfiguration of a product’s supply chain—cut across regional interests.

To enable IBP to deliver its impact, the company conducted a structured process assessment to evaluate the maturity of all inputs into IBP. It then set out to redesign, in detail, its processes for planning demand and supply, inventory strategies, parametrization, and target setting, so that IBP would work with best-practice inputs. To encourage collaboration, leaders also started to redefine the performance management system so that it included clear accountability for not only the metrics that each function controlled but also shared metrics. Finally, digital dashboards were developed to track and monitor the realization of benefits for individual functions, regional leaders, and the global IBP team.

A critical component of the IBP rollout was creating a company-wide awareness of its benefits and the leaders’ expectations for the quality of managers’ contributions and decision-making discipline. To educate and show commitment from the CEO down, this information was rolled out in a campaign of town halls and media communications to all employees. The company also set up a formal capability-building program for the leaders and participants in the IBP decision cycle.

Rolled out in every region, the new training helps people learn how to run an effective IBP cycle, to recognize the signs of good process management, and to internalize decision authority, thresholds, and escalation paths. Within a few months, the new process, led by a confident and motivated leadership team, enabled closer company-wide collaboration during tumultuous market conditions. That offset price inflation for materials (which adversely affected peers) and maintained the company’s EBITDA performance.

Our research shows that these high-maturity IBP examples are in the minority. In practice, few companies use the IBP process to support effective decision making (Exhibit 2). For two-thirds of the organizations in our data set, IBP meetings are periodic business reviews rather than an integral part of the continuous cycle of decisions and adjustments needed to keep organizations aligned with their strategic and tactical goals. Some companies delegate IBP to junior staff. The frequency of meetings averages one a month. That can make these processes especially ineffective—lacking either the senior-level participation for making consequential strategic decisions or the frequency for timely operational reactions.

Finally, most companies struggle to turn their plans into effective actions: critical metrics and responsibilities are not aligned across functions, so it’s hard to steer the business in a collaborative way. Who is responsible for the accuracy of forecasts? What steps will be taken to improve it? How about adherence to the plan? Are functions incentivized to hold excess inventory? Less than 10 percent of all companies have a performance management system that encourages the right behavior across the organization.

By contrast, at the most effective organizations, IBP meetings are all about decisions and their impact on the P&L—an impact enabled by focused metrics and incentives for collaboration. Relevant inputs (data, insights, and decision scenarios) are diligently prepared and syndicated before meetings to help decision makers make the right choices quickly and effectively. These companies support IBP by managing their short-term planning decisions prescriptively, specifying thresholds to distinguish changes immediately integrated into existing plans from day-to-day noise. Within such boundaries, real-time daily decisions are made in accordance with the objectives of the entire business, not siloed frontline functions. This responsive execution is tightly linked with the IBP process, so that the fact base is always up-to-date for the next planning iteration.

A better plan for IBP

In our experience, integrated business planning can help a business succeed in a sustainable way if three conditions are met. First, the process must be designed for the P&L owner, not individual functions in the business. Second, processes are built for purpose, not from generic best-practice templates. Finally, the people involved in the process have the authority, skills, and confidence to make relevant, consequential decisions.

Design for the P&L owner

IBP gives leaders a systematic opportunity to unlock P&L performance by coordinating strategies and tactics across traditional business functions. This doesn’t mean that IBP won’t function as a business review process, but it is more effective when focused on decisions in the interest of the whole business. An IBP process designed to help P&L owners make effective decisions as they run the company creates requirements different from those of a process owned by individual functions, such as supply chain or manufacturing.

One fundamental requirement is senior-level participation from all stakeholder functions and business areas, so that decisions can be made in every meeting. The design of the IBP cycle, including preparatory work preceding decision-making meetings, should help leaders make general decisions or resolve minor issues outside of formal milestone meetings. It should also focus the attention of P&L leaders on the most important and pressing issues. These goals can be achieved with disciplined approaches to evaluating the impact of decisions and with financial thresholds that determine what is brought to the attention of the P&L leader.

The aggregated output of the IBP process would be a full, risk-evaluated business plan covering a midterm planning horizon. This plan then becomes the only accepted and executed plan across the organization. The objective isn’t a single hard number. It is an accepted, unified view of which new products will come online and when, and how they will affect the performance of the overall portfolio. The plan will also take into account the variabilities and uncertainties of the business: demand expectations, how the company will respond to supply constraints, and so on. Layered risks and opportunities and aligned actions across stakeholders indicate how to execute the plan.

Would you like to learn more about our Operations Practice ?

Trade-offs arising from risks and opportunities in realizing revenues, margins, or cost objectives are determined by the P&L owner at the level where those trade-offs arise—local for local, global for global. To make this possible, data visible in real time and support for decision making in meetings are essential. This approach works best in companies with strong data governance processes and tools, which increase confidence in the objectivity of the IBP process and support for implementing the resulting decisions. In addition, senior leaders can demonstrate their commitment to the value and the standards of IBP by participating in the process, sponsoring capability-building efforts for the teams that contribute inputs to the IBP, and owning decisions and outcomes.

Fit-for-purpose process design and frequency

To make IBP a value-adding capability, the business will probably need to redesign its planning processes from a clean sheet.

First, clean sheeting IBP means that it should be considered and designed from the decision maker’s perspective. What information does a P&L owner need to make a decision on a given topic? What possible scenarios should that leader consider, and what would be their monetary and nonmonetary impact? The IBP process can standardize this information—for example, by summarizing it in templates so that the responsible parties know, up front, which data, analytics, and impact information to provide.

Second, essential inputs into IBP determine its quality. These inputs include consistency in the way planners use data, methods, and systems to make accurate forecasts, manage constraints, simulate scenarios, and close the loop from planning to the production shopfloor by optimizing schedules, monitoring adherence, and using incentives to manufacture according to plan.

Determining the frequency of the IBP cycle, and its timely integration with tactical execution processes, would also be part of this redesign. Big items—such as capacity investments and divestments, new-product introductions, and line extensions—should be reviewed regularly. Monthly reviews are typical, but a quarterly cadence may also be appropriate in situations with less frequent changes. Weekly iterations then optimize the plan in response to confirmed orders, short-term capacity constraints, or other unpredictable events. The bidirectional link between planning and execution must be strong, and investments in technology may be required to better connect them, so that they use the same data repository and have continuous-feedback loops.

Authorize consequential decision making

Finally, every IBP process step needs autonomous decision making for the problems in its scope, as well as a clear path to escalate, if necessary. The design of the process must therefore include decision-type authority, decision thresholds, and escalation paths. Capability-building interventions should support teams to ensure disciplined and effective decision making—and that means enforcing participation discipline, as well. The failure of a few key stakeholders to prioritize participation can undermine the whole process.

Decision-making autonomy is also relevant for short-term planning and execution. Success in tactical execution depends on how early a problem is identified and how quickly and effectively it is resolved. A good execution framework includes, for example, a classification of possible events, along with resolution guidelines based on root cause methodology. It should also specify the thresholds, in scope and scale of impact, for operational decision making and the escalation path if those thresholds are met.

Transforming supply chains: Do you have the skills to accelerate your capabilities?

In addition to guidelines for decision making, the cross-functional team in charge of executing the plan needs autonomy to decide on a course of action for events outside the original plan, as well as the authority to see those actions implemented. Clear integration points between tactical execution and the IBP process protect the latter’s focus on midterm decision making and help tactical teams execute in response to immediate market needs.

An opportunity, but no ‘silver bullet’

With all the elements described above, IBP has a solid foundation to create value for a business. But IBP is no silver bullet. To achieve a top-performing supply chain combining timely and complete customer service with optimal cost and capital expenditures, companies also need mature planning and fulfillment processes using advanced systems and tools. That would include robust planning discipline and a collaboration culture covering all time horizons with appropriate processes while integrating commercial, planning, manufacturing, logistics, and sourcing organizations at all relevant levels.

As more companies implement advanced planning systems and nerve centers , the typical monthly IBP frequency might no longer be appropriate. Some companies may need to spend more time on short-term execution by increasing the frequency of planning and replanning. Others may be able to retain a quarterly IBP process, along with a robust autonomous-planning or exception engine. Already, advanced planning systems not only direct the valuable time of experts to the most critical demand and supply imbalances but also aggregate and disaggregate large volumes of data on the back end. These targeted reactions are part of a critical learning mechanism for the supply chain.

Over time, with root cause analyses and cross-functional collaboration on systemic fixes, the supply chain’s nerve center can get smarter at executing plans, separating noise from real issues, and proactively managing deviations. All this can eventually shorten IBP cycles, without the risk of overreacting to noise, and give P&L owners real-time transparency into how their decisions might affect performance.

P&L owners thinking about upgrading their S&OP or IBP processes can’t rely on textbook checklists. Instead, they can assume leadership of IBP and help their organizations turn strategies and plans into effective actions. To do so, they must sponsor IBP as a cross-functional driver of business decisions, fed by thoughtfully designed processes and aligned decision rights, as well as a performance management and capability-building system that encourages the right behavior and learning mechanisms across the organization. As integrated planning matures, supported by appropriate technology and maturing supply chain–management practices, it could shorten decision times and accelerate its impact on the business.

Elena Dumitrescu is a senior knowledge expert in McKinsey’s Toronto office, Matt Jochim is a partner in the London office, and Ali Sankur is a senior expert and associate partner in the Chicago office, where Ketan Shah is a partner.

Explore a career with us

Related articles.

To improve your supply chain, modernize your supply-chain IT

Supply-chain resilience: Is there a holy grail?

What Is Integrated Business Planning and Why Is It Important?

Think of modern integrated business planning, or IBP, as a mashup of supply chain optimization, financial planning and analysis (FP&A) and operational best practices, powered by a companywide culture that’s all about delivering the speed, savings and responsiveness today’s consumers demand while managing risk.

Note that IBP as a fuzzy, buzzword-laden process methodology has been around for years. It’s usually implemented by expensive consultants in sprawling, global corporations that know they need to unify siloed sales, supply, financial and operational resources — before more nimble competitors relegate them to the former Fortune 500 list.

We’re here to argue that IBP deserves a second look for any company that wants to maximize profits and minimize the risks associated with growth. No six-figure consultant required.

What Is Integrated Business Planning?

On paper, IBP is a process for aligning a company’s business goals with its finance, supply chain, product development, marketing and other operational functions. Think parts suppliers that work with automakers and need to constantly retool to accommodate design changes, or food producers operating on razor-thin margins that must manage both uncertain supply chains and fickle customer tastes.

Lag, and a competitor is standing by to take that business. Move quickly but in a disjointed manner and you may keep customers, but at the expense of higher cost of goods sold (COGS) and lower profitability.

For example, consider PickerBots, a fictional maker of custom machinery for manufacturing and warehouse operations. When the company launched in 2017, it found a niche in restaurant supply, but when that business slowed significantly in 2020 the founders decided to retool. Rather than simply changing up its marketing, the firm set out to revamp its business strategy. A top-down scenario planning exercise led to realigning its R&D, demand forecasting, profitability and revenue analysis, supply chain planning and marketing and sales strategy.

The company culture was already strong on innovative thinking, but the founders realized that the link between strategic planning and day-to-day operations could use improvement. Enter a new COO with the chops to align operations with product demand planning and sales and marketing while weighing in on financial targets and budgets.

Key Takeaways

• In a company that embraces IBP, there’s a direct line from purchasing, production and inventory to sales and marketing to financial targets and budgets.
• A key IBP benefit is that materials are bought at the right price, at the right time and in just the right quantity to fulfill market demand.
• Successful IBP delivers closer collaboration and more trust among departments, leading to improved decision-making.
• IBP may require significant cultural change and cannot be successful without unwavering commitment from the executive team.

Integrated Business Planning Explained

Many organizations mistake IBP for a supply-chain-centric exercise. While linking supply chain planning with other departments, from sales and operations through finance, is important, that’s just one element.

IBP aligns business g oals and financial t argets with decisions and execution across the entire business.

There is overlap with financial planning and analysis (FP&A). Because an IBP initiative gathers data from across the enterprise, companies get better at predictive analysis. Now, when purchasing forecasts a parts shortage, supply and operations can adjust before customers are affected.

It’s also not a one-and-done exercise. PickerBots’ new COO advises looking a minimum of 36 months out. Leaders will need to keep their eyes on that long-range plan while continually reviewing, revising and communicating financial and operating results. What supply chain gaps have opened up, and how can we close them? Do we need to update our scenario planning? Are we tracking the right financial KPIs?

A crucial element of IBP is that it integrates financials with operations. Here’s a structure that PickerBots plans to follow.

Why Is Integrated Business Planning Important?

Companies that undertake IBP realize a number of practical benefits, including reduced holding costs, more responsive customer service and demand fulfillment, shorter time to market for new products and an improved correlation between demand planning and fulfillment.

After PickerBot’s scenario planning and strategy session, the company decided to jump into the emerging collaborative robot, or cobot, market. A collaborative robot is designed to safely interact with human workers. PickerBot’s leaders believe demand will increase for “pick and place” cobots with fine motor skills for use on manufacturing lines as well as in agricultural settings.

Now that the company has its strategic direction, the COO wants to focus on three higher-level concepts before delving into more practical areas, like financial planning and analysis and supply chain optimization. That’s because without goal-setting, PickerBots won’t be able to define success.

Alignment and accountability 

All executives must agree on three things: What are our corporate goals? What does success look like for each? How will I and my team contribute and be accountable?

The company’s goals are grouped into four areas: industry-focused, operations and supply chain, financial and marketing and sales. The management team will review all goals to make sure they align with strategy and are both actionable and achievable.

Industry-focused goal: Offer the most innovative cobots on the market

What success looks like: Develop a product that can match or exceed a human worker in its ability to pick fragile crops without damage.

Who will execute: The R&D team

Financial goal: Diversify revenue streams

What success looks like: Minimize dependence on one market/industry. Add a services arm to generate recurring revenue from maintenance contracts, powered by sensors built in to all new products.

Who will execute: Cross-functional led by CEO and finance

Other goals might be “control costs at each step and deliver cobots to customers on time and to specifications” with an expectation to lower COGS by 10% and raise the company’s Net Promoter Score by 25% within one year. Or for sales, “find 10 new customers for the company’s agricultural cobots and bundle maintenance contracts with each sale.” That ties back to revenue diversification.

An important point: Every manager is accountable for every goal, not just those that lie within their purviews.

Informed decisions and actions 

Planning across PickerBots’ supply chain was disjointed, with engineers purchasing materials direct and little central planning or cost control. As part of the IBP process, the company will adopt sales and operations planning (S&OP) principles to improve its supply chain and logistics.

Actionable goals here include building visibility into how each department is working and tying the impact of decisions to financial goals. For example, by having R&D build in sensors that can automatically collect and transmit data on a cobot’s operational status, PickerBots can proactively perform preventative maintenance so the devices are almost never down — an important selling point and a way to contribute to maintenance income.

Organizationwide, divisions need to focus less on their own needs and view actions through the lens of all goals. That means the company needs to collect a lot of timely data and use it to issue reports so managers can make better decisions, more quickly. That may require an investment in ERP and other software.

Transparency/visibility 

All department heads will take part in a monthly business review, where the group will assess progress in achieving the company’s objectives. The strategic plan is also available to all staff members, and quarterly all-hands meetings will be held to gather ideas and insights and walk through KPIs.

Four success metrics for the IBP process include:

1. Getting all stakeholders to buy in to corporate goals so that everyone agrees and understands what the business wants to achieve and how it will get there. There are clear responsibilities for each function in the pursuit of goals.

2. Basing business decisions on data. The integration of finance into product, demand and supply functions is key here, as are selecting the right KPIs.

3. Tying decision-making to outcomes and improving accountability. Because every department is responsible for providing accurate numbers and projections, there’s less risk that the CFO and finance team are left holding the bag if revenues fall short.

4. Shifting the culture to embrace cross-functional collaboration. An IBP process encourages openness and trust, and as a result more deeply engages and empowers employees. As an action item, each R&D and manufacturing team member will spend a week annually accompanying sales reps on customer calls.

What Is the Difference Between S&OP and IBP?

The term “IBP” was coined by management consultancy Oliver Wight to describe the next iteration of the sales and operations planning (S&OP) process Wight developed in the early 1980s.

The big difference between IBP and S&OP is that the latter has become the domain of supply chain and logistics specialists, particularly those involved in supply-and-demand balancing and planning. S&OP is execution-focused and involves a traditional budgeting process.

In contrast, IBP takes a more cross-functional and holistic approach to weaving business goals through every function. As a result, in theory, supply chain management is proactive and optimized.

IBP includes S&OP processes but because it involves cultural change, without executive buy-in, IBP will not be successful.

Some major differences between S&OP and IBP are:

6 Steps in the Integrated Business Planning Process

Now that its goals are set, PickerBots can take the next steps in its IBP journey.

1. Determine what is holding the company back. Is it a lack or growth or profitability? Is the product portfolio too complex? Has the business lost competitiveness in its space? For our manufacturing firm, the main problem was overfocus on one niche market.

2. Engage and educate employees. Once leadership buys in to goals, that enthusiasm must trickle down through the ranks. Unless everyone is committed to integrated business planning, success will be elusive. The COO recognizes that a formal employee engagement program will keep workers invested in the success of the business and actively working to meet strategic goals.

3. Set up a tiger team. IBP success comes from tight coordination, constant communication and accountability for KPIs. It’s a cultural shift that will take time to propagate throughout the business. To jumpstart things, PickerBots identified engaged employees within each functional area and assigned them to a daily 20-minute standup call. Now, say a shipment of RFID readers needed by manufacturing will be two weeks late. The purchasing team member shares that information promptly so that sales can manage customer expectations and finance can account for delayed revenue. If the problem recurs, the company can seek out new suppliers. No more surprises.

4. Establish a project/product prioritization process. IBP takes discipline. Only projects that forward the company’s strategic goals get resources. Same for products. That might mean sunsetting a line that’s still selling but lacks growth potential. All managers who require resources or have a product or service launch idea fill out a cost-benefit analysis template that is tailored to reveal whether expected benefits and costs align with goals. Leadership prioritizes using this process. No more sacred cows.

5. Expand the finance team’s influence. Finance needs to sit in on product planning, supply chain optimization and sales strategy meetings. Specifically, choose a finance team member well-versed in FP&A functions. FP&A professionals inform major decisions made by the executive team and collect and analyze financial data from across the organization to create reports that reveal whether goals are being met — and if not, why not? How do we fix the problem? Like many smaller firms, PickerBots doesn’t have a dedicated FP&A staffer, so the head of finance assigns an accounting team member who knows the business and has an aptitude for data collection and number crunching.

6. Adopt technology and tools to support IBP. If the forecasting process is seen as a quarterly or annual exercise imposed by finance and yielding little benefit to departments, IBP can’t succeed. Companies with static, point-in-time budgets need to adopt rolling forecasts to make sure the business stays on track. And, finance teams need to be able to easily access the data they need from each operational area. Both rolling forecasts and better use of data require technology and a commitment to transparency. You can’t manage what you can’t measure.

Traditional vs. Rolling Forecasts

5 tips to succeed at integrated business planning.

Some ways the COO plans to set PickerBots up for success include:

1. Sell IBP as a way to bring order from chaos. For example, large companies, especially those that have engaged in a number of mergers and acquisitions, may have thousands of SKUs and product codes. One big manufacturer Oliver Wight worked with used IBP to whittle 120,000 item numbers down to about 10,000 and reduce inventories by 50% while improving on-time, in-full delivery by up to 20%. For a smaller company, IBP can prevent ever getting in a situation where it needs to slash 90% of SKUs.

2. Adopt a continuous improvement mindset. All parts of any production or service system, particularly people, are interconnected, inform one another and are mutually dependent on generating successful outcomes. This practice’s origin comes from Kaizen, a Japanese term meaning “change for the better.” Originating in Japan, the business philosophy looks to continuously improve operations and involve all employees, from assembly line workers to the CEO. It’s a way to reinforce IBP.

3. Get buy-in from the CIO. PickerBots’ CIO came up through the ranks of manufacturing IT and is familiar with the concept of Total Quality Management (TQM), which has overlap with IBP. That went a long way in communicating the benefits of IBP and freeing up budget for technologies that can make IBP work, like ERP, enterprise performance management (EPM), supply chain management and real-time-capable accounting and finance software — especially important to realize the “one set of numbers” value proposition.

4. Apply risk management principles. Disasters large and small happen. While the zen of IBP skews toward positive and upbeat, make sure department heads are doing scenario planning and what-if analyses to model operational risk — like overdependence on one market. Consider assigning your tiger team a secondary function as a crisis management strike force.

5. Don’t forget HR. Labor is likely your company’s biggest operating expense, so ensure that it’s working for your IBP effort, not against it. A human resources professional can identify traits in applicants — like team players who are data driven and comfortable with transparency — that predict whether they will be contributors to IBP success.

Benefits of Integrated Business Planning

Research shows that the main benefit of implementing IBP is increased revenue, followed by forecast accuracy and improved Perfect Order Delivery rates.

Three additional key benefits:

Real-time insights: Once companies have instituted rolling forecasts, for example, finance can more quickly and accurately answer questions on spending and cash flow. Expect more accurate KPIs across the board.

Ownership: The flip side of accountability is that in a company fully embracing IBP, all employees assume responsibility for meeting all goals. So you’d better make sure that authority to make decisions is decentralized and tied to responsibility for outcomes, because there are few bigger morale killers than accountability without the power to effect success. Companies can further nurture a culture of ownership by tying rewards to meeting or exceeding goals.

Improved customer satisfaction: While more on-time, in-full deliveries make customers happy, that’s not the only way IBP improves Net Promoter Scores. Better planning yields better insights into what customers want, and a strong company culture often leads to improved customer empathy and its associated benefits.

Integrated Business Planning Adoption Challenges

Where a business starts with IBP depends on its maturity. Companies with dog-eat-dog cultures and highly siloed processes have a lot of work to do. These tend to be firms with traditional top-down management structures, static annual budgeting with little ability to generate forward-looking projections and dated business plans that are misaligned with current customer needs.

While all are thorny structural challenges, a leadership team that’s averse to placing trust and decision-making authority at lower levels of the organization is in even worse shape. Companies with autocratic, command-and-control styles must be willing to decentralize authority if they hope to realize IPB’s benefits.

Even businesses with mature, integrated processes and egalitarian cultures often get tripped up by “top down” versus “bottom up” KPI reporting and budgeting. IBP requires businesses to focus less on finance developing a top-line budget and then handing departmental budgets down from on high. Rather, they need to become comfortable with a bottom-up process, where departments start with a plan of what they want to achieve, calculate what it will cost and then feed a number up to the finance team, which uses that input to calculate the total budget.

Companies not already using at least a somewhat flexible budgeting process are likely to find this shift difficult. One way to jump-start the transformation might be a modern form of zero-based budgeting.

Steps of Zero-Based Budgeting for 2021

• Create a strategic vision for ZBB: Identify cost targets, relevant KPIs and goals.
• Evaluate business units to select ZBB candidates (also referred to as “decision units,” or any organ of the business that operates independently with its own budget).
• Start selected budgets from scratch (i.e., from zero).
• Each decision unit provides “decision packages,” which break down each activity in terms of its objective, funding needs, justification in the context of company goals, technical viability and alternative courses of action.
• Evaluate each proposed item to determine its value-add to the company and whether the entire cost is justified. What does the expenditure bring back to the company?
• Prioritize costs based on company goals. Reduce or cut expenses in areas that no longer produce significant value.
• Allocate funds among areas that are productive and aligned with the business’s growth drivers.

Elements of Integrated Business Planning

Integrated business planning takes place at a regular cadence; every month is most common, so we’ll use that in our example.

These steps are standard for IBP consultants, adaptable to most industries and bake in the PickerBots COO’s virtuous cycle of market research and strategic planning, R&D and manufacturing, demand forecasting and predictive analysis, profitability analysis, supply chain optimization and marketing and sales strategy.

1. Product management review. This includes all elements of product portfolio management. A cross-functional team meets monthly to review the overall status of all of product-related projects: Are they on track? Have we identified new risks and opportunities? Are the most high-value products or services prioritized? The goal is aligning the product portfolio with business goals and making sure needed raw materials and manufacturing floor capacity are lined up. Product managers revise as needed and publish an updated master plan, along with the resources it’ll take to deliver any changes.

2. Demand planning picks it up. This is a cross-functional process that helps businesses meet customer demand for products while minimizing excess inventory and avoiding supply chain disruptions. Demand planning can increase profitability and customer satisfaction and lead to efficiency gains. This team brings together members of sales, marketing and finance to determine whether they’re targeting the right markets, the right way. They work up an optimized demand plan. Relevant KPIs include sales forecast accuracy, inventory turns, fill rates and order fulfillment lead times.

3. Then, the ball goes to the supply planning team. These supply chain experts work out the optimal way to meet projected demand in a cost-effective way. The key is to have visibility into complex supply chains; a formal supply chain visibility (SCV) project helps spot and fix weaknesses, such as inventory shortfalls or order fulfillment issues, before they become major problems. Lower cost of goods sold (COGS) is the North star.

4. The integrated reconciliation team pulls together the initial product, demand and supply plans and consolidates them into one holistic business plan based on a 24- or 36-month projection; for iterative updates, teams highlight material changes. Decisions that could not be made by individual teams are prepared for executive review.

5. The executive team resolves conflicts and rolls the updated plan out to the entire company.

Integrated Business Planning Components

The components of integrated business planning comprise three buckets: Plan, execute and monitor and adjust.

Specific actions falling into each bucket vary depending on the consultancy or technology supplier. Some are more aligned with supply chain planning, while others center on S&OP or financial planning with plug-ins to other functional areas. Others are very industry-specific.

Let’s look at Oracle’s IBPX (Integrated Business Planning and Execution) for Manufacturing solution as an example. Key components include:

• Top-down and bottom-up, driver-based planning and forecasting
• Risk modeling for M&A and strategic initiatives
• Full financial statement structure for strategic and operational planning
• Predictive and prescriptive analytics and planning
• A preseeded S&OP process
• Near-real-time demand and supply balancing
• Real-time backlog management
• Automation of predictions and correction actions based on actuals
• AI-enabled operational planning, such as for sales territories and quotas
• IoT and sensor data flows integrated with automated decisions

Items like backlog management and enhanced support for IoT and sensor data are important to manufacturers like PickerBots. A retailer might be more interested in advanced inventory management. What’s important is that any solution, whether purchased as a suite or pulled together by an integrator or in-house team, supports the ability to do long- and medium-range and short-term planning based on a single, up-to-date data set that’s accessible to all authorized stakeholders.

Also look for the ability to easily model “what-if” scenarios, robust budgeting and costing and a roadmap to advanced technologies like AI and predictive analytics.

Integrated Business Planning Examples

We mentioned the Oliver Wight customer that whittled 120,000 SKUs down to about 10,000. That firm, Uponor Group, looked to IBP after a string of acquisitions left it with swelling inventories, an extremely complex portfolio and a lack of communication between siloed functions and far-flung locations. The Finnish company sells products for drinking water delivery as well as radiant heating and cooling equipment and has 3,900 employees in 30 countries. Uponor had a hard time getting a singular view of financial information across its subsidiaries, and each unit had its own practices for inventory management. Small events, such as holidays, would drive some sites to build up “just in case” inventory, and double-stocking in warehouses was common. Subsidiaries in different countries had different SKUs for the same items, and R&D was localized, with no collaboration across the company.

Upinor focused first on its supply chain and implemented S&OP processes, then advanced to IBP the following year. The results have been an increase in net sales of $1.1 billion euros, a 30% improvement in on-time in-full deliveries, a 50% reduction in inventories and increased visibility.

U.S.-based technology provider Juniper Networks also undertook an IBP project focused on implementing a digital supply chain with IBP, where the business planning process would extend S&OP throughout the supply chain, product and customer portfolios, customer demand and strategic planning.

Since undertaking the project, Juniper’s lead-time attainment is up 55%. and its inventory costs are down by 15%, allowing it to realize a positive ROI on the IBC project.

History of Integrated Business Planning

Oliver Wight developed S&OP in the 1980s as a methodology for a client that wanted to balance supply-and-demand volume. In the years since, the process evolved to integrate financials, inventory and new-product introductions.

The consultancy renamed S&OP as integrated business planning in the late 1990s to reflect the process of integrating all functions of the business behind one optimized plan. Since then, a newer term, “enterprise integrated business planning,” has emerged. EIBP includes scenario planning and extended supply chain collaboration and discusses how large companies will adopt new technologies, such as AI, big data and advanced analytics.

#1 Cloud ERP Software

Applications of Integrated Business Planning

IBP makes planning and operations much more transparent, so it’s ideal for companies moving to “just in time” manufacturing. It’s also predictive, once a company builds up some data. That can help with customer satisfaction.

PickerBots, as an example, found that it typically sees constrained supply chain capacity for motherboards in Q3. With that insight, sales and marketing can work to encourage customers to take delivery of systems in Q2 or Q4, manufacturing can prebuild products and supply chain leaders can work on alternate sources for parts that pose challenges.

Looking ahead to the future of IBP, we expect it to help companies:

• Work on ever-longer-range strategy planning, modeling and M&A activities with a higher degree of confidence.
• Detect and notify stakeholders of unanticipated events before they impact the business by using advanced technologies, including real-time sensor information and machine learning (ML) pattern recognition.

As companies build comfort with automation, advanced IBP systems can be set to take action based on analysis without human intervention. Consider a chain of bakeries; a system plugged into a long-range weather forecast system might detect a tropical storm that could raise the price of vanilla and automatically order extra.

Cloud-based technology such as ERP underpins all these advances. For example, PickerBots always set its sales goals monthly. But often these plans were delayed to let the executive team review and approve any changes, meaning operations was caught unawares. A tool like NetSuite Planning and Budgeting automates planning processes and centralizes company financial and operational data, so finance teams can disseminate updates quickly.

The next frontier? Expending IBP to business partners and suppliers, even customers. But first, companies need to get their own cultural and technology houses in order.

Business Strategy

Business Process Automation: Ultimate Guide

A well-run business is always analyzing business processes and finding ways to make them more efficient. It also searches for ways to review, update, change, replace or eliminate its processes on a regular basis in order to…

More On This

Trending Articles

Learn How NetSuite Can Streamline Your Business

NetSuite has packaged the experience gained from tens of thousands of worldwide deployments over two decades into a set of leading practices that pave a clear path to success and are proven to deliver rapid business value. With NetSuite, you go live in a predictable timeframe — smart, stepped implementations begin with sales and span the entire customer lifecycle, so there’s continuity from sales to services to support.

Before you go...

Discover the products that 37,000+ customers depend on to fuel their growth.

Before you go. Talk with our team or check out these resources.

Want to set up a chat later? Let us do the lifting.

NetSuite ERP

Explore what NetSuite ERP can do for you.

Business Guide

Complete Guide to Cloud ERP Implementation

• Webinar Replays
• News & Press
• User Groups
• Brand Ambassadors
• OneStream Press
• Solution Exchange
• PartnerStream
• Financial Close & Consolidation
• Financial Signaling
• Reporting & Analytics
• Financial Data Quality
• Account Reconciliations
• Transaction Matching
• Compliance Solutions
• Tax Provision
• ESG Reporting & Planning
• Planning, Budgeting & Forecasting
• AI Financial Forecasting
• People Planning
• Capital Planning
• Sales Planning
• Profitability Analysis
• Manufacturing
• Financial Services
• Public Sector
• Higher Education
• Oracle Hyperion Conversion
• SAP ERP Customers

• Consulting Services
• Certification Program
• ONECommunity

• Customer Success
• News & Press

Complete Guide to Integrated Business Planning (IBP)

Integrated Business Planning, or IBP for short, is a strategic management process that connects various organizational departments to align business operations with financial goals. How? By integrating business functions – such as Sales, Marketing, Finance, Supply Chain and Operations – to create a holistic view of the company’s performance and future direction. This blog post offers a comprehensive guide to discuss what precisely IBP entails and how Finance can drive business results and collaboration within the organization via a robust and comprehensive IBP process.

What Is IBP?

While the business world and Finance have always had shared language and acronyms, some new (and reimagined) acronyms may now be flooding your feed.  One such topic you may be hearing a lot about lately is Integrated Business Planning (IBP).  Yet the concept of IBP isn’t new. In fact, it’s related to Sales & Operations Planning (S&OP) , a concept that’s been around awhile.

Still, IBP may seem overwhelming in the context of all the different acronyms related to financial and operational planning floating around lately.  For example, IBP, S&OP, eXtended Planning and Analysis (xP&A) and others are just a few acronyms muddying the waters.  But this comprehensive guide to all things IBP aims to help demystify the process.

So what, exactly, is IBP?

IBP ultimately aims to unify business strategy with planning, budgeting and forecasting activity for all business lines and functions – providing one version of the numbers.  In turn, a trusted, common view of the numbers provides a robust baseline for agile decision-making.  That common view also keeps all teams collectively trying to achieve the same corporate objectives while staying focused on specific KPIs. In other words, the different teams maintain their independence while working in unison to achieve corporate success by leveraging the same trusted and governed data.

The bottom line?  IBP is about aligning strategy intent, unifying planning processes and bringing the organization together.

How IBP Works

The IBP process is a framework to address the C-suite needs and help implement the business strategy and manage uncertainty to improve decision-making.  So what’s the secret sauce of IBP to make all of that happen?  A collaboration between the different teams under a single view of the numbers that must unequivocally be tied to financial performance.  That’s how the C-suite gets value from IBP. Consequently, Finance plays a central role in the IBP process.

IBP typically focuses on horizons of 24-60 months, as opposed to the short term.  That focus equates to Integrated Tactical Planning or Sales and Operations Planning and Execution.  Since the process must be fully integrated, it removes the departmental silos.  Plus, the IBP process must adapt to the organizational construct of every business (IBP isn’t a one-size-fits-all type of process).

A typical IBP process involves several stages:

• Data Collection and Analysis :  Gathering relevant data (e.g., sales forecasts, production capacities, inventory levels and financial projections) from different departments.
• Demand Planning:  Predicting future demand based on historical data, market trends, customer feedback and sales forecasts.
• Supply Planning:   Determining the resources and capabilities (e.g., materials, production capacity and distribution channels) needed to meet the forecasted demand.
• Financial Planning :  Developing financial plans and budgets aligned with the demand and supply forecasts, considering factors such as revenue targets, cost structures and investment requirements.
• Scenario Planning:   Creating alternative scenarios to assess how different strategies, market conditions or external factors impact business outcomes.
• Management Business Review :  Collaborating across departments to make informed decisions on resource allocation, investments, pricing strategies and operational adjustments.
• Execution and Monitoring :  Implementing the plans, tracking performance against targets, and continuously monitoring key metrics to identify deviations and take corrective actions.

The most efficient way to foster this collaboration is through a unified solution and data model that caters to the needs of the various agents involved on each review.  In fact, Figure 1 shows how one solution gathering all the capabilities in the greyed area under a unified data model is the most efficient approach to IBP.

Figure 1: A Unified Data Model for IBP

Core Elements and Stages of the IBP Process

The IBP process includes the following core elements:

• Governance Structure :  Establishing a cross-functional team with representatives from key departments to oversee the IBP process, define roles and responsibilities, and ensure alignment with organizational goals.
• Data Integration :  Integrating data from different systems and sources to create a single source of truth for decision-making, using technologies such as enterprise resource planning (ERP) systems, Corporate Performance Management (CPM) tools, business intelligence (BI) tools and data analytics platforms.
• Collaborative Planning :  Encouraging collaboration and communication between departments to share insights, align objectives and develop consensus-based plans that support overall business objectives.
• Continuous Improvement :  Implementing feedback loops, performance reviews and process refinements to enhance the effectiveness and agility of the IBP process over time.

Want to learn how you can maximize the benefits of your IBP process and get leadership on board with the plan?  Check out our eBook Unifying Integrated Business Planning Across Finance and Supply Chain .  You’ll learn how to unify IBP across Finance and Supply Chain teams and read about use cases as proof points.  Plus, you’ll gain an understanding of the unique capabilities OneStream’s Intelligent Finance Platform brings to unify Finance and Supply Chain planning activities.

Get Started With a Personal Demo

Streamline Financial Processes

• United States

Integrated planning: The key to agile enterprise performance management

Facebook Twitter Linked In E-mail this page

Table of contents

What is integrated planning, change as a given: the truth about plans, planning across the organization, the ultimate integrated planning solution.

• Need for real-time insights
• Integrated planning
• Agile and ready organizations
• Integrated planning drives better results

Integration is key to streamlined planning, budgeting, and forecasting. In order to adapt to today's quickly changing business conditions, you need an enterprise performance management solution that creates a single source of truth and delivers speed and agility to your planning process.

Did you know that 33 percent of critical information is delivered late?

The delay of critical information can cause a ripple effect that drives poor decision making and poor results. Today’s business simply cannot afford this type of cost in our customer-centric environment, where data is one of our most valuable assets. To stay ahead of the competition, businesses rely on a solution that can deliver acceleration, agility, and collaboration in every part of the organization.

Integrated planning ensures all parts of the organization are connected and planning is streamlined.

A must in the culture of “now.”

In virtually all industries, work has become more interactive and collaborative. More sharing is required, and more data is available than ever before. Success means integrating information across strategic and operational perspectives, as well as different functional and external sources.

Integrated planning mirrors the modern way we do business — it elevates the critical value of collaboration and cuts through data silos, driving more access to information and faster insights. Leaders use highly collaborative approaches to plan, budget, and forecast. Business planning requires accurate and complete data and buy-in across the entire organization, both from the top down and the bottom up. It sounds simple, but organizational silos are some of the biggest obstacles to accomplishing good work because they hinder critical decisions that strategically steer the business. And at the modern enterprise, silos are everywhere.

Integrated planning starts with a sophisticated planning platform that everyone in the organization can use, creating one source of truth. Data from diverse data sources such as ERPs, CRMs, and HRMs is unified, so users can access the information they need when they need it. Integrated planning helps ensure that plans, budgets, and forecasts are created with a holistic approach. Trends are easier to spot and quickly act on with more accurate and reliable plans. According to analysts at the Aberdeen Group , those organizations that champion data accessibility and collaboration between stakeholders promote organizational accountability and decrease time-to-decisions while increasing revenue. 1

The fact of the matter is that without effective communication, coordination, and collaboration between stakeholders, there is no way to improve organizational performance. 1

Bringing together people, data, and technology leaves organizations well-poised for optimal performance. Most importantly, integrated planning enables employees to be agile in responding to changing circumstances and able make the best decisions possible — all at the speed of modern business.

According to an Aberdeen study, 1 leaders who adopt enterprise performance management tools show a keen understanding of the importance of collaboration. They recognize that to make data driven decisions, they need to make all information accessible by integrating data and breaking down silos. Figure 1 shows steps taken by leaders to democratize data and drive more accurate forecasts.

Leaders put a high value on data integration and accessibility. They see the value of providing real-time data to decision makers and taking the guesswork out of forecasting. These strategies create comprehensive, actionable visibility into overall company performance and drive better results.

Gartner Predicts by 2020, at least 25 percent of large organizations will increase planning accuracy by integrating key operational planning processes with financial planning and analysis. 2

Do you have an integrated view of your data?

I do not feel confident in where to find comprehensive data, even for just my department

I have a good handle on my own departmental data (but only mine)

I have access to my data and that of other departments that impact my planning

IBM Planning Analytics helps Deutsche Bahn unite its global enterprise

Deutsche Bahn AG is a German railway company, and one of the largest IBM Planning Analytics customers with over 6,000 users worldwide. Deutsche Bahn uses IBM Planning Analytics to unite their wide-ranging operations across the globe, ensuring that the most accurate data is being used to create critical plans and forecasts that drive their business forward.

The truth about plans is that they always change. The goal of a dynamic, integrated planning approach is not to create a perfect, fixed plan. It’s to use all the resources available to create the most accurate, flexible and transparent plan possible, using a solution that does more than just plan — it analyzes data, reveals trends, and allows for real-time iteration.

Better, quicker access to data means faster and more informed decisions, laying the foundation for an organization to be agile and ready to pivot when changing business conditions demand.

If you’re reading this and thinking, “great, the finance team integrates all our plans, so we are off the hook,” think again. While we’d like to think that finance is the well-informed master of plans, miraculously weaving them together in perfect harmony and balance, that’s not always the case. In fact, it rarely is. Many, many finance teams rely on the manual collection of data into spreadsheets, which are often disconnected. Remember that much of an organization’s critical planning starts outside of finance and never gets communicated back up the chain or across the organization. There are simply too many top-down and bottom-up communication problems. Spreadsheets only complicate smooth communications. When a finance person is collecting and analyzing budget spreadsheets from across the organization, there is high risk for error in the process of combining and editing, causing confusion at the highest levels. Contradictory data can inhibit a clear picture of what is actually going on and identifying business drivers or detractors. Spreadsheets have proven over and over to be a highly imperfect yet highly common business practice.

With real-time access to data, companies take the guesswork out of planning, decreasing time involved in forecasting and increasing forecast accuracy. 3

Bye bye, silos. Hello, cross-functional planning.

A centralized, automated solution for performance data and planning allows coordination between different parts of the business and enables more streamlined, accurate plans. Leadership needs to understand what is truly driving the business — what causes increases and decreases in revenue or demand. At every level, access to a full range of data is critical to understanding how change (both internal and external) impacts the business. Though planning often starts with finance, other areas of the business can benefit from a dynamic planning solution as well. Let’s dive into a few use cases.

Supply chain planning

The term “operations” covers an enormous range of business activities. But one that’s almost universal is supply chain management. Supply chain planners are under constant pressure to reduce costs, increase efficiency and improve margins. Unfortunately, too many of them lack visibility into data and are misaligned with other teams. One centralized tool can help connect operational tactics with financial plans to allocate resources more effectively in response to market opportunities or competitive threats. This helps planners avoid mismatched data across multiple spreadsheets and enables them to pivot in the case of supply chain disruptions.

“ Our managers all have quick, easy access to the latest operational data via detailed reports that help them make better-informed decisions to improve the efficiency of the entire supply chain. ”

- Homarjun Agrahari, Director, Advanced Analytics, FleetPride

Learn more about supply chain planning

Infographic Webinar Learn more

Workforce planning

A company is only as good its people. That’s why it’s so important to hire and retain the right talent. Alignment between HR, finance and operations is crucial to ensure that the right people are in the right roles at the right time in order to meet organizational demands. This is rarely a simple task and too often it involves manual spreadsheet-based processes. Ensuring that departmental staffing targets are in sync with broader organizational objectives requires high levels of planning integration.

“ Our business is based on people. IBM Analytics is helping us manage that critical asset much more efficiently and effectively than ever before. ”

- Nadia Bertoncini, Coordinator of Governance, Projects and HR Analytics for Latin America, Natura Cosméticos

Learn more about workforce planning

Infographic Aberdeen report Learn more

Sales planning

Misalignment between finance, marketing and sales could lead to investment in the wrong initiatives, missed opportunities and inaccurate revenue forecasts that can severely hinder sales growth. And in a fast-moving market, manual processes and siloed systems are detrimental to agility. Decisions that are based on outdated information can lead to misguided sales strategies and thus lost sales and lost revenue. It’s critical to unite data under one roof for one single view to boost sales and effectively manage sales people.

“ The sheer level of detail that IBM Planning Analytics provides is very impressive … We can calculate our sales and gross margins for each SKU in IBM Planning Analytics and generate insightful reports at the click of a button. As a result, senior managers can rapidly access the comprehensive information they need to make effective strategic decisions. ”

- Vince Mertens, Group Accounting and Consolidation Manager, Continental Foods

Learn more about sales planning

Marketing planning

Constantly changing customer preferences and rising customer expectations require marketers to interpret high volumes of data and respond appropriately. But siloed data systems give only a partial picture and hinder smart decision-making. In addition, marketing teams can be fragmented and often disconnected from sales. Siloed planning causes misalignment with overall marketing goals, driving misallocated spend on the wrong elements of the marketing mix. Manual, siloed processes reduce visibility into how marketing activities affect one another, how marketing and sales touches move a lead through the funnel and how marketing helps achieve overall financial and business goals.

“ We first needed a better handle on our sales data. With so many lines of business, channels, and franchisees, collecting and consolidating this information was something that we knew we could do better. ”

- Donald Neumann, Demand Manager, Grupo Boticário

Learn more about marketing planning

Ventana report Learn more Infographic

IT planning

With IT, you need a business case for every dollar spent. But balancing the IT needs of an entire organization with digital transformation objectives and constant technology innovation is no simple task, and often requires additional resources. That’s why it’s so important leverage a planning solution that keeps IT focused on the projects that matter, automates planning tasks, gives a clear view into resources available and helps measure ROI. It’s also critical to coordinate with both finance and human resources to ensure the right resources are provided for IT initiatives and projects.

“ A few years ago, my team probably spent around half their time just keeping everything running — now it’s around 10 percent. With the move to IBM Analytics in the IBM Cloud, we have 40 percent more time to focus on working with the business to add value. Instead of asking ‘how do I make it work?’ we ask ourselves ‘how do I make it better?’ It’s a quantum shift in mindset. ”

- Vimal Dev, Vice President – IT, Global Enterprise Applications Leader, Genpact

Learn more about IT planning

Learn more IBV report

Operations, sales, marketing, human resources and other departments and disciplines all have a need for fast, flexible planning and analysis. And all of them can use the same tools to provide insight and manage performance. When people in one part of the organization see how their decisions affect other parts of the organization, all of the activities will be better coordinated and drive better results. In fact, according to Aberdeen, leading organizations are those who align planning across departments at double the rate of laggards in areas like sales, marketing and finance.

Become a leader

With IBM Planning Analytics , you can break down silos and generate an integrated view of your departmental or organizational performance. The solution enables you to create more accurate forecasts, identify potential performance gaps before they occur and make resource allocation decisions quickly and intelligently. Using multidimensional modeling and scenario analysis, IBM Planning Analytics lets you drill down into your data to examine the ripple effects of alternative courses of action and understand how your decision will affect related areas of the organization and ultimately impact the bottom line.

Using what-if scenario analysis to make smarter decisions

With IBM Planning Analytics, you can build multidimensional models and perform “what-if” analysis to explore scenarios or test business assumptions. Creating and maintaining sophisticated models with advanced sandboxing capabilities is simple. Easily test business assumptions and model scenarios to immediately see the impact of alternative courses of action on before deciding to implement changes.

IBM Planning Analytics offers all areas of your business — finance, operations, HR, sales, marketing, operations, IT and more — the ability to solve problems today and respond to new challenges with agility tomorrow.

Click on any quadrant for more information.

Headcount and staffing planning

Salary and compensation planning

Successions planning

Corporate planning and, budgeting and forecasting

Strategy planning

Operational planning

Capital planning

Expense planning

Profitability analysis

Demand planning

Sales and operations planning

IT project planning

IT budgeting

IT portfolio management

Sales territory planning and quota planning

Sales forecasting

Sales capacity planning

Resource allocation

Marketing revenue planning and forecasting

Campaign optimization

Dive deeper into the solution

Find out if IBM Planning Analytics is right for you.

Download the white paper

Download and save the PDF version of this SmarterPaper.

Try the interactive demo

Experience an interactive demo to get a real taste of functionality.

Shortfall: CFOs worry that their teams aren’t ready to weather the disruption

Here are four issues that are holding back many finance organizations and possible solutions.

Integrated Business Planning

Succession planning

Corporate planning, budgeting and forecasting

Strategic planning

Captial planning

• Many companies are eager to develop better plans and forecasts, so they are trying to integrate the planning process across the organization. More and more, they are turning to AI-driven IBP platforms.
• Investing in these platforms can result in a 2 to 4 percentage point annual increase in revenues, a 2 to 3 percentage point decrease in costs, and a 15% to 30% reduction in inventories, on average.
• But IBP platforms are expensive and challenging to implement. Organizations should take five steps to be successful.

Subscribe to our Artificial Intelligence E-Alert.

Consumer Products Industry

/ article, ai can transform integrated business planning.

By  Lana Klein ,  Aneesh Saxena ,  Tristan Mallet ,  Abhijeet Shetty ,  Olivier Bouffault ,  Daniel Sack , and  Rachel Wegman

Key Takeaways

It’s an issue that’s increasingly vexing CEOs as the world becomes more uncertain and complex: Why haven’t digital technologies made business planning better, faster, and easier? Why don’t plans survive the first contact with reality?

The COVID-19 pandemic and its long aftermath exposed numerous gaps in business planning. Many companies have been trying to strengthen their planning capabilities—with decidedly mixed results. Functions and business units often continue to plan in silos, and the assumptions behind most forecasts still aren’t transparent. So top management teams continue to find it tough to reconcile plans across organizational levels and time horizons.

To tackle these challenges, companies are increasingly turning to integrated business planning (IBP) platforms that are driven by artificial intelligence (AI). Traditional IBP used enterprise resource planning platforms that were supplemented by data from other systems, and it was mostly a manual process in terms of data aggregation and forecasting. Difficult to coordinate, IBP was hampered by a lack of trust in the data and opacity. It also had few predictive or optimization capabilities.

Today’s AI-driven IBP platforms help companies create a rich data fabric, an automated planning process, and algorithm-based decision support. Available as software as a service (SaaS) packages or as an orchestrated solution, investing in AI-driven IBP can result in a 2 to 4 percentage point annual increase in revenues, a 2 to 3 percentage point decrease in costs, and a 15% to 30% reduction in inventories, on average. Besides, using IBP increases job satisfaction by making work more systematic, which frees up time for strategic tasks and innovation.

But an AI-driven IBP system isn’t easy to design or deploy. It’s also a major investment. The cost can run into tens of millions of dollars, often exceeding $100 million for large corporations—and that doesn’t include the time and internal resources needed for its implementation. In our experience, many companies that have implemented AI-enable IBP platforms say that they didn’t realize as much value as they had hoped to, mainly because of a poor adoption rate, misaligned processes, and the lack of connectivity between IBP tools.

Modern IBP solutions must seamlessly integrate people, processes, and digital technologies—the trinity of effective end-to-end planning. In this article, we focus on the role of technology.

The Power of AI-Enabled IBP

AI-driven IBP platforms help companies improve business planning in several ways. Chiefly, they create a planning process that extends from end to end in an organization. The platforms connect upstream planning, such as supply chain planning , with downstream planning, such as demand forecasts, commercial planning, and financial forecasting. (See the exhibit.)

At a minimum, these platforms also automate planning, and they potentially enable planners to make better decisions with predictive and prescriptive analytics. Companies can migrate from manual to automated forecasting and gain the capabilities for scenario planning as well as real-time simulations. The latter shift the planners’ focus from numbers to identifying the key risks and opportunities. As a result, the planning process becomes faster, easier, and better.

Faster. AI-driven IBP platforms use automated data feeds and AI-driven forecasting models, shortening the time needed to develop forecasts. Automation minimizes the number of planning iterations, while the use of objective parameters for data eliminates the need for endless discussions. Migrating to an automated IBP platform enables companies to cut planning cycle times by 30% to 40%, while the ability to use signals-driven forecasting ensures that companies can prepare for and execute faster organization-wide responses to change.

Easier. AI-driven IBP solutions also ensure that companies can align—in real time—demand, supply, and financial plans using common data sources. The process works across functions, business units, and teams, so companies can resolve the risks involved in not fulfilling commitments as well as identify opportunities to bolster growth. And since the process is usually automated, there’s little need for using Excel spreadsheets or crunching numbers anymore.

Better. By connecting demand forecasts and supply scenarios, AI-enabled IBP provides better visibility into operating constraints, allowing companies to close gaps either by increasing supplies or reshaping demand through promotional and marketing efforts. And end-to-end visibility reduces supply chain costs by ensuring more efficient logistics, lowering warehousing expenses, and improving order management. As a result, IBP platforms improve the accuracy of forecasts by as much as 25 percentage points and typically by at least 10 percentage points.

Getting AI-Driven IBP Right

Implementing an AI-enabled IBP platform is a challenging journey that requires building a data foundation and using AI-powered analytic models to automate planning. An implementation also necessitates orchestrating technology across systems and upskilling the organization. Companies should take five steps to be successful.

Harness all data. An AI-driven process demands large quantities of data that is as fresh as possible. It also needs different kinds of data, which could take the form of standard inputs as well as early-warning signals. Smart companies draw on a variety of data; the leaders use as many as 15 to 20 data sets for demand planning alone. An end-to-end IBP solution also involves hundreds of internal and external signals, which makes data one of the key challenges in automating planning.

Creating an IBP process requires merging, harmonizing, and automating inputs from many sources, both internal and external. Some internal sources will be easy to integrate; however, a lot of the data may not be centrally stored, let alone automated. Promotion data, for instance, often exists only in spreadsheets on sales teams’ laptops, so it can be tough to access it in a timely fashion. If data sources haven’t been centralized, an organization should use manual workarounds in the short term and automate the data flows in the long run. The challenge with externally sourced data is identifying the right signals and finding reliable data sources.

While many SaaS IBP platforms boast of data integration capabilities, being able to use multiple sources of data isn’t enough. Planning becomes better only because of the systematic cleaning, understanding, and enrichment (through manipulation) of the most important data sets. Raw data fed into machine learning models will marginally improve the performance of business planning models, but data transformation boosts accuracy by at least 10 percentage points. That’s why when implementing a SaaS platform, wise companies deploy more systematic and rigorous data governance systems, and they build data capabilities to analyze and extract results from data sets.

As the first step of its migration to IBP, for example, a beauty products player created an integrated data foundation for demand planning. It found, aggregated, and harmonized data from 14 sources: shipments, orders, and inventory databases; three sell-out databases; two databases for historic and planned marketing efforts; distribution and promotional databases; a weather service; and sources for COVID-19 incidences, macroeconomic data, and consumer price trends. Many sources didn’t have owners and the data quality was dubious, so the company created and applied governance standards to ensure that the data was reliable. By using quality data and developing algorithms to forecast demand for different time horizons and granularity levels, the company was able to boost its bottom line by 2% per year.

Orchestrate the solution. Many SaaS IBP platforms promise to eliminate planning-related problems; CEOs, chief technology officers, and chief information officers would do well to carefully evaluate prospective solutions to find one that addresses their specific challenges.

Using a single out-of-the-box package as the basis of an IBP solution sounds good in theory, but it is usually problematic in practice, especially for large companies since the implementation can be complex and time consuming. Moreover, business units and functions typically have invested in systems that don’t talk to each other. For these reasons, SaaS IBP platforms will have to be orchestrated solutions that connect existing systems, close the gaps, and integrate them into an end-to-end platform.

A large company whose sales exceed $15 billion bought a supply planning platform, a trade planning system, and a financial planning solution, each from a different vendor for a total investment of about $100 million. None of the solutions were set up to integrate with each other. While the supply plans and demand forecasts were drawn up in terms of volumes at the SKU level, the financial plan projected income and expenses at the business unit level. The trade planning solution went largely unused by the sales teams, which continued to rely on the plans they built in spreadsheets. The only way forward was to evaluate each system, identify the problems and gaps, and develop fit-for-purpose software to integrate them.

Customize algorithms and scenario and forecasting models. Although most out-of-the-box IBP systems come with some forecasting capabilities, off-the-shelf algorithms are far from optimal and will often be less accurate than customized ones. We find that using custom algorithms improves the accuracy of forecasts by 5 to 20 percentage points.

Rapid scenario planning—one of the most desirable features of an integrated planning system—increases the value of demand planning exponentially. In complex and connected industries, the ability to quickly understand the tradeoffs while making decisions is a major benefit that IBP provides.

Forecasting transparency is another desirable. Most planning forecasts are still black boxes, providing only basic insights into the relative weight of different inputs or making simple attributions to their drivers. That doesn’t foster trust among decision makers; only customized forecasting models can provide a level of transparency that is in line with the expectations of decision makers. Such models offer more visibility into the inputs used for drawing up forecasts, the assumptions made about execution, and the level of uncertainty in the forecasted numbers. This level of visibility not only builds trust but also provides actionable insights about the levers that executives can use to deliver better results.

Customized generative AI systems will turbocharge AI’s role in IBP in the future. A generative AI system could near-instantly scan through thousands of data points and provide insights, in natural language, about past changes in sales trends, the outliers in historic data, the reasons for sales acceleration or deceleration, and new growth opportunities. The technology could also be used to enhance data quality and enrich it with product attributes (from, say, photographs), as well as tune and update AI-based planning models. Generative AI may also help executives envision novel human-machine interfaces for planning, such as conversation-based ones.

Manage the transition patiently. Shifting to an AI-driven IBP platform will require extensive employee training across functions and organizational levels. Employees have to get used to the new ways of working and learn to trust the new process, and that will take time. Companies should start small, generate value early, and give their nascent capabilities the time they need to mature. Transitioning to an IBP process can be executed in sprints, but institutionalizing it is a marathon that requires the top management teams to stay the course.

Managing IBP-related change poses two key challenges. The first is fostering collaboration between previously unconnected functions, which requires redesigning the planning process as well as better aligning goals across functions. Stakeholders need to understand how the new process will benefit them and what implications it will have on their day-to-day work to make the transition. The shift also demands redistributing power and accountability that, in turn, needs careful management and constant communication by business leaders to the entire organization.

The second hurdle is getting business planners to adopt AI-driven IBP. Planners, who often have been in their jobs for decades, may have reservations about shifting to AI-driven models. In addition, many don’t have an analytics background, so they may not understand how the new models work. Like employees in other sectors, many may feel threatened by the technology, believing that it will sooner or later make their jobs redundant.

Explaining how AI models function when training business planners is a crucial first step. Companies also need to communicate that analytics and automation won’t replace them but will augment their power. Technology can take on the routine, calculation-intense parts of forecasting so that planners can shift to reviewing exceptions and adjusting for critical parameters, such as hero SKUs (products whose volumes or profits are crucial to the business), important promotions and campaigns, and new product introductions. Consequently, business planning meetings can shift from a my-number-versus-your-number debate to identifying fresh opportunities and developing risk mitigation strategies.

By way of illustration, a multinational company with three main product lines wanted to shorten its seven-week planning cycle, adjust to demand signals more quickly, and have a rationale for allocations at times of shortages. It therefore invested in an AI-enabled IBP platform that it could customize by product line, distribution channel, and region. The company piped in data from more than 40 sources and created a data management and governance system for which it trained more than 100 employees. To ensure that the platform would be used, the company conducted 15 training sessions across the globe for more than 200 users at a time. After it had completed the transition to the new system, the company reckoned that using IBP had increased revenues by about $50 million and reduced working capital requirements by $100 million a year.

Ensure top management teams’ support. Shifting to AI-driven IBP platforms can noticeably improve both the top and bottom lines. That’s why smart business leaders treat IBP not just as a new planning process but as a company-wide initiative to boost performance.

Top management teams’ involvement is critical to help create the vision, draw up the objectives, and ensure that the organization is aligned around them. Business leaders’ support will also be needed to break down the barriers between functions and business units, rethink business processes, and change the way executives have traditionally developed business plans. They must demonstrate their commitment to an IBP platform by sponsoring capability-building efforts and agreeing to own the decisions to which the new planning process leads them—regardless of the consequences for their function or unit.

A consumer products company recently transformed its planning by unifying its sales, demand, supply, and financial planning processes into a single process. Led by the chief operating officer (COO), the initiative’s main objective was to unlock growth opportunities by creating a planning process that focused on each business unit’s performance, rather than on the objectives of each function. This overhaul required shifting some responsibilities, roles, and authority in each of its businesses. The COO’s involvement was critical to set planning goals and to ensure alignment across the organization about the use of IBP. Partly as a result, the business units that implemented the new system boosted revenues by 2%, improved forecast accuracy by up to 15%, and shortened the time taken to finalize business plans by more than 30%.

As uncertainty shrouds the global economy and technological change accelerates, business planning will become more relevant—and complicated. To stay ahead, CEOs have to invest in developing planning capabilities that seamlessly integrate people, processes, data, and technology across functions. Only such a transformation will enable companies to adapt rapidly to changing demand and supply conditions, gain visibility into risks and opportunities early, and ensure that every part of the organization is striving to achieve the same goals. After all, a company without an integrated business plan will find that every road it takes leads it nowhere.

Partner & Associate Director

Managing Director & Partner, BCG X

Managing Director & Partner

Managing Director & Senior Partner; Europe, Middle East, South America, and Africa Chair, BCG X

ABOUT BOSTON CONSULTING GROUP

Boston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. BCG was the pioneer in business strategy when it was founded in 1963. Today, we work closely with clients to embrace a transformational approach aimed at benefiting all stakeholders—empowering organizations to grow, build sustainable competitive advantage, and drive positive societal impact.

Our diverse, global teams bring deep industry and functional expertise and a range of perspectives that question the status quo and spark change. BCG delivers solutions through leading-edge management consulting, technology and design, and corporate and digital ventures. We work in a uniquely collaborative model across the firm and throughout all levels of the client organization, fueled by the goal of helping our clients thrive and enabling them to make the world a better place.

© Boston Consulting Group 2024. All rights reserved.

For information or permission to reprint, please contact BCG at [email protected] . To find the latest BCG content and register to receive e-alerts on this topic or others, please visit bcg.com . Follow Boston Consulting Group on Facebook and X (formerly Twitter) .

What’s Next

Read more insights from BCG’s teams of experts.

Five Pricing Moves for CPG in a Cost-of-Living Crisis

Consumer packaged goods companies have many options for balancing volume and profit in a downturn, but they need the right tools to make the changes stick.

How Consumer Companies Can Pull Off Two Transformations at Once

CPG firms face a long-term need to update their enterprise software and a short-term need to implement a digital transformation. With the right approach, they can accomplish both.

Supply Chain AI

Supply Chain AI takes a holistic approach to transforming a company’s supply chain, from strategy and design through integrated planning and optimized execution. Backed by a unique set of AI solutions from BCG X, we enhance seven key supply chain capabilities while developing the plans, processes, skills, and culture that fuel and accelerate transformation.

A Guide to IT Innovation for Packaged Goods Makers

For the biggest impact, companies should focus on using AI, digitizing must-have capabilities, and adopting new ways of working.

• End-to-End Strategy & FP
• Infrastructure Strategy & CP
• Business Continuity & SCRM
• Production Strategy
• Network Design
• Supply/Inventory Planning
• Product & Customer Profitability
• Sourcing & Procurement
• Production Scheduling
• Order Allocation
• Our Leadership & Board
• Testimonials
• Our Partners
• Schedule Demo

Share This Blog

At its finest, IBP is fully aligned with growth and innovation metrics, having turned S&OP into a strategic business partner. Visualize aligning your company’s operational decisions with forward-looking financial performance across various timeframes, representing complex trade-offs, constraints, and real-time business realities across the value chain; this is what a successful IBP looks like! 

For more than a decade, our customers have struggled with the term IBP and how it relates to sales and operations planning (S&OP), sales and operations execution (SOE) sales inventory operations planning (SIOP), sales and operations management (S&OM), and other processes.

Despite knowing its importance, businesses have been slow to adopt integrated business planning. Many have yet to establish a fluid S&OP process.

Why Companies Struggle to Adopt IBP

So…why are companies still struggling to adopt IBP? A few reasons include:

• Conflicting goals among business units and barriers due to the evolutions of processes and technologies
• Existing technology design
• Traditional methods of doing business

A recent study shows that 79% of companies continue to use spreadsheet planning, yet only 39% say that spreadsheets support a collaborative planning process .

( Download the research perspective here for more insights and how to tackle problems with spreadsheet planning. )

Here’s the problem: Inflexible tools like spreadsheets don’t allow for a cross-functional representation of the business. Also, spreadsheets don’t provide forward-looking insights  — a requirement for IBP. Instead, spreadsheets produce infeasible plans, inhibit collaborative planning, and suck loads of time that could be better spent elsewhere.

In one case study, a snack food giant wasn’t meeting demand on its most profitable product due to constrained capacities. When it tried utilizing its 20+ spreadsheets, they continued to fall short of reaching targets and became well aware that they were missing out on major profit opportunities.

Spreadsheets may work for isolated scenarios but not integrating functions to solve one common goal (meeting demand) while aligning with strategic objectives (e.g., recognizing additional profit opportunities). This is the essence of integrated business planning 

Top 7 Barriers to Integrated Business Planning

In addition to spreadsheets, here are a few other barriers that we have found:

• Technology and process structures don’t allow integration.  Traditional software solution designs differ in structure, hindering integration. Supply chain software was built from the ground up with a data model that was singularly focused toward certain areas like demand, supply, logistics, etc. Financial planning and analysis tools which model the General Ledger/Chart of Accounts from a transactional and roll-up perspective take the opposite approach. As such, supply chain planning and financial planning technologies were never destined to meet.
• Complex skill set required.  Optimization solutions present barriers within barriers: modeling a complex supply chain often requires difficult coding and provides no visualization.
• Different cultures within the organization.  Business units within the enterprise usually have a culture of its own; the undertaking of understanding another unit’s goals while striving to reach its own seemed impossible.
• Linear scenario management tools.  Like optimization, scenario management tools can’t replicate real-world complexities, nor acknowledge that what-ifs are not linear.
• Use of spreadsheets as a primary planning tool.  Maintaining the status quo use of spreadsheets presents an inflexible resource unable to integrate and align business goals.
• Inflexible solutions prevent data quality, access, and management.  Solutions are designed to operate a specific way, and often unlike the business, meaning that the access to data or its quality and management are reliant upon the system.
• No C-Suite awareness.  Understanding the meaning and feasibility of IBP often lies outside the C-Suite periphery. As a relatively new process that has been difficult to put into practice, IBP is an educational endeavor within the organization; IBP fails to get the attention of the C-Suite that benefits from it most. The CEO/CFO can be unaware of the benefits of IBP. In this post, we describe situations where employees keep profit-improving opportunities a secret , because an individual silo may be somewhat negatively impacted.

Clearly, navigating the challenges to implementing IBP starts with understanding the advantages that IBP provides.

How Does IBP Work?

IBP represents the end-to-end business goals with a process that takes into consideration each business silo and its various functions. For example, is the operational plan represented in a cash flow statement? If not, what good is an operating plan that includes a product mix with margin contributions that put cash flow risk?  It’s why the outcome of IBP is a true business plan, rather than a demand plan, supply plan, production plan, or a financial budget.

Through IBP, enterprises gain a single holistic plan that unifies the business, seamlessly connecting corporate performance management, financial planning processes, and operational planning systems. This comprehensive business plan increases business alignment through the sharing of performance strategies and helps quantify business risk so enterprises can rapidly adapt to meet challenges.

Why We Need IBP Now More than Ever

Even in a good economy, financial pressure to perform is paramount to maintaining a competitive edge and interesting enough, no different than the factors driving IBP following the 2009 recession. These include:

• Demand volatility has increased considerably for most companies.
• Supply complexity has increased with options such as subcontracting manufacturing and logistics operations — both of which are more common. Supply chains are broader in scope, including goods that are distributed across worldwide supply chains.
• Input cost volatility is a constant, increasing challenge for profitability. No matter the commodity (e.g., aluminum, gas, or petrochemicals), all experience sudden market changes.
• Non-linear connection between costs and volume fluctuates with a mix of fixed and variable costs; some costs vary by volume and others by time, making it more difficult to understand the financial implications of business decisions.

Yet, IBP is essentially an outgrowth of S&OP that fully aligns customer, product, demand, product, and strategic portfolios across a value chain to drive the strategy of a company, its financial performance, and its operational and tactical plans. This realization began as early as decades ago but hasn’t gained much traction in implementation until recently.    

With process changes like global sourcing and distribution, the complexities of the supply chain make it necessary to synchronize operational plans with financial and strategic business goals and understand impacts to the enterprise as a whole.

The Need for What-If Analysis for Successful Integrated Business Planning

IBP is only possible with cross-enterprise, what-if scenario planning across various planning horizons. With true integrated business planning, new questions to new answers can be address — driving unmatched value to every aspect of the value chain.

In one use case involving a product mix portfolio, IBP can answer what-ifs such as:

• What if we need to move from one raw material to another, over the next several years?
• What if we want to expand into new opportunities. Where should we be investing?
• What if we make changes in design, materials, and production. How will it affect short- and long-term planning?
• What if new capital expenditures are required today and in the future?
• What if we made acquisitions instead of more capital expenditure projects?

The what-ifs allow companies to find optimal scenarios in addition to optimizing the existing way of doing business.

In other words, what-if scenario analysis is what allows companies to integrate their supply chain plans with finance, manufacturing, procurement, sales, marketing, etc. 

The Unmatched Benefits of IBP

IBP has some astounding impacts on those companies who successfully adopt it. Some of the benefits our customers have seen are:

• Profit improvements equal to 2-5% of annual revenue within the first year alone
• Reduced working capital expenses by 15% or more
• Optimization of logistics, capacity, procurement, supply and demand all with the use of a single planning solution
• Improved cross-functional collaboration, planning agility, risk mitigation, and forecast accuracy
• Reduced planning timeframes from weeks or months to just a few days or hours.
• Increased stakeholder value for the company, at large
• Broader trust in plans 

6 Factors to Find the Best IBP Solution

Cloud-based technologies, machine learning, and artificial intelligence (AI) sources have eliminated some technology barriers; however, traditional methods continue to play a significant role in preventing companies from using IBP.

When evaluating Integrated Business Planning solutions, these should include:

• Can execution characteristics, capabilities, and constraints be modeled correctly in order to gain an achievable strategic plan?
• Can the IBP solution co-create financial plans in sync with operational plans? Note: a financial plan refers to audit quality financial statements (e.g., Income statement, Balance Sheet, Cash Flow) which provide a full financial picture?
• Does this solution allow users to clearly understand variances – from a budget to a plan, or a baseline to a scenario, at operational and financial levels?)
• Can the solution evaluate alternative “what-if” scenarios in the formation of budgets, strategies, and operational plans? Can the scenarios consider financials as constraints? Can the scenarios optimize to multiple objective functions at the discretion of the user?
• Can we drill down and understand the root causes of those gaps?
• Does the solution have a concept of marginal contribution? This provides the specifics needed to understand the targeted actions taken. If more of this product is sold, will it have this impact? Is it worth it? If less of that product is sold, will it have this impact? Are the risks worth taking?

Intelligent Modeling as a Requirement for Successful IBP

Successful Integrated Business Planning includes unique technology capabilities. Below are the most important ones:

• An underlying holistic model that represents the business as it behaves in reality, including business, financial, and supply chain constraints. Additionally, it is essential to know how variable and fixed costs are incurred, the structure of reporting hierarchies, and process flows with mass/energy balance.
• Allowing users to simulate and optimize scenarios with multiple objective functions
• Supporting analyses from different angles (e.g., solving for optimal product mix rather than holding product mix constant, and solving for a supply plan) allow users to communicate effectively and understand the impact on key performance indicators.
• Providing rich information, including detailed cost analyses, marginal profitability, financial statements, key bottlenecks/constraints, etc.

River Logic as a Recognized Leader in S&OP/IBP

Currently, River Logic is a Leader in Gartner’s Magic Quadrant for S&OP and a Gartner-ranked global leader in both prescriptive analytics/optimization and Corporate Financial Planning. To date, we are the only vendor that is noted in all three of these areas.

River Logic has been a long-time thought leader in the IBP space and has been delivering Integrated Business Planning and S&OP solutions to global clients since 2005.

Our solution fundamentally looks at IBP through the lens of the CEO/CFO: charts of financial accounts and net income and a focus on the value chain. In other words, it truly has an integrated business plan as part of its data model regarding finance, supply, demand and any value chain function that needs to be modeled. River Logic is a comprehensive business modeling tool and much more than just supply-chain modeling tool.

1 Magic Quadrant for Sales and Operations Planning Systems of Differentiation , Gartner Research, May 2017.

More Blog Posts

Leveraging ai in supply chain strategy: insights from peter bull’s real talks webinar, ai’s transformative potential in supply chain strategy, business continuity planning in supply chain: lessons from mike tyson.

North American Building Materials Leader Cornerstone Building Brands Chooses ToolsGroup and River Logic’s Technology

River Logic’s Value Chain Optimization technology chosen to Support Tarmac’s sustainable construction solutions

ToolsGroup And River Logic Partner to Provide a Comprehensive Supply Chain Planning Solution

River Logic Dramatically Advances Supply Chain Experience with Enhancements to its Digital Planning Twin™

Priefert Selects River Logic to Enhance its Advanced Modeling Capabilities

American Tire Distributors Engages River Logic’s Digital Planning Twin™ Technology Solution as Part of Digital Transformation

• End-to-End Strategy & Financial Scenarios
• Infrastructure Strategy & Capacity Planning
• Business Continuity Planning & Supply Chain Risk
• Product & Customer Profitability
• Sourcing & Procurement
• Cement Manufacturing
• Our Leadership & Board

0800/5 34 34 24

United States

+1-800-872-1727

Or see our complete list of local country numbers

Chat Unavailable

Allow Functional Cookies to enable chat

Send us your comments, questions, or feedback.

• All Products
• Supply Chain Management
• SAP Integrated Business Planning
• Technical Information
• Get Started

SAP Integrated Business Planning for Supply Chain

Reduce risk when changing supply chains and drive sustainable growth, June 3-5.

Register now

What is SAP Integrated Business Planning for Supply Chain?

Plan for a sustainable, risk-resilient future with the SAP Integrated Business Planning for Supply Chain (SAP IBP) solution. Speed responsiveness and stay ahead of change with supply chain analytics, what-if simulations, alerts, and more.

Powered by SAP HANA, this cloud-based solution combines sales and operations planning (S&OP), forecasting and demand, response and supply, demand-driven replenishment, and inventory planning.

• Automated, tightly coordinated supply chain planning processes
• Advanced machine learning algorithms and planning capabilities
• Native integration with SAP Supply Chain Control Tower and other solutions

2023 annual customer report for SAP IBP

What were the highlights for SAP IBP over the past year? Dive in to find out.

Read the report

See how customers are succeeding with SAP

Forecasting demand for the future of mobility

See how ZF Friedrichshafen meets demand for its intelligent products with an integrated ecosystem of planning applications.

Optimizing inventory and service levels globally

Explore how Hyundai Mobis is reducing excess inventory and being more responsive to customer needs.

Enhancing sustainable production with data forecasting

Learn how DMK Group unified data processes on one platform so business units can track inventory data.

Building an intelligent digital supply chain

Learn how Microsoft harnessed big data, machine learning, and IoT to build a connected and predictive digital supply chain.

Product awards

SAP Integrated Business Planning wins "Top Rated" award from TrustRadius

What are analysts saying about planning and the sustainable, risk-resilient supply chain?

Building visibility with supply chain planning

Read the Oxford Economics research into building visibility and collaboration in supply chain planning to avoid risk.

Tapping the power of AI for supply chain planning

Read what IDC has to say about how forward-thinking companies are using AI to make sense of their data and conquer supply chain complexity.

Frequently asked questions

What is sap ibp.

The SAP Integrated Business Planning for Supply Chain (SAP IBP) solution is a cloud-based supply chain planning solution that scales to accommodate business growth and integrates with other SAP and third-party systems. It integrates key aspects of the planning process including demand, supply, inventory, and sales and operations planning (S&OP). Designed to help you streamline planning and improve performance, SAP IBP supports data-driven decision-making and simplified collaboration to increase operational efficiency. This is accomplished with help from advanced analytics, artificial intelligence, and powerful optimization algorithms that enable real-time visibility, better forecasting, and faster decision-making across the entire supply chain.

Which modules are part of SAP IBP?

• Demand management: SAP IBP integrates historical data, market trends, and advanced predictive analytics so that you can generate more accurate demand forecasts.
• Response and supply planning: SAP IBP takes capacity constraints, lead times, and inventory levels into account so that you can optimize production and distribution plans and more efficiently meet customer demands.
• Inventory management: SAP IBP helps you maintain optimal inventory levels by balancing the trade-offs between carrying costs, stockouts, and service levels.
• Sales and operations planning: SAP IBP provides a unified platform for collaborative planning, allowing different departments to align on strategic goals and operational plans.
• Demand-driven replenishment: SAP IBP supports DDMRP for strategically positioning inventory buffers in the supply chain to absorb variability and uncertainty.
• Supply chain control tower: SAP IBP supports the real-time supply chain visibility and enhanced analytics you need to quickly respond to changing market conditions and customer requirements.

Who uses SAP IBP?

More than 1,000 companies worldwide use SAP IBP to streamline supply chain and planning processes. Ranging from large multinational corporations to medium-sized enterprises, these companies span a wide range of industries, including manufacturing, retail, consumer goods, pharmaceuticals, automotive, aerospace, and many others. Some of the key users of SAP IBP include:

• Supply chain managers: They use SAP IBP to optimize supply chain processes, improve visibility, and monitor and control inventory levels.
• Demand planners: They use SAP IBP to forecast customer demand accurately, align supply with demand, and improve overall customer satisfaction.
• Sales and operations planners: They use SAP IBP to align sales, marketing, and operations teams to execute integrated business plans and achieve financial targets.
• Inventory managers: They use SAP IBP to optimize inventory levels, minimize carrying costs, and improve working capital efficiency.
• Executives and decision-makers: They use SAP IBP to gain insights into the overall health of the business, make data-driven decisions, and drive strategic initiatives.

Linking CPFR with Integrated Business Planning

Leading companies continue their migration towards best practices and emerging technologies as they strengthen their supply chain, both within their own corporation and externally with their trading partners. This paper describes how two leading industry supply chain best practices are being linked together to leverage what each does best - collaboration. This paper describes the vision, process, and value of linking CPFR® and Integrated Business Planning.

More white papers on this subject

Scenario Planning: A necessary skill to drive better decision making in IBP

Marketing's Role in the Integrated Business Planning Process

Get Rhythm: The Operating Cadence of Integrated Business Planning

Unshackling your organisation through business decompression

Don't fall for fake news; a buyer's guide to Integrated Business Planning

ABC for Integrated Business Planning

Workshops on this subject

11 Jun 2024

Virtual (English)

Integrated Business Planning – Introduction, Overview, and Current Best Practice

More information +

10 Sep 2024

08 Oct 2024

Virtual (French)

French Integrated Business Planning Workshop

12 Nov 2024

Companies using SAP Integrated Business Planning

We have data on 379 companies that use SAP Integrated Business Planning. The companies using SAP Integrated Business Planning are most often found in United States and in the Information Technology and Services industry. SAP Integrated Business Planning is most often used by companies with >10000 employees and >1000M dollars in revenue. Our data for SAP Integrated Business Planning usage goes back as far as 6 years and 3 months.

If you’re interested in the companies that use SAP Integrated Business Planning, you may want to check out SAP Materials Management and JDA as well.

Who uses SAP Integrated Business Planning?

Target sap integrated business planning customers to accomplish your sales and marketing goals., sap integrated business planning market share and competitors in supply chain management (scm).

We use the best indexing techniques combined with advanced data science to monitor the market share of over 15,000 technology products, including Supply Chain Management (SCM). By scanning billions of public documents, we are able to collect deep insights on every company, with over 100 data fields per company at an average. In the Supply Chain Management (SCM) category, SAP Integrated Business Planning has a market share of about 0.4%. Other major and competing products in this category include:

What is SAP Integrated Business Planning?

SAP Integrated Business Planning is a next-generation planning application, powered by SAP HANA that helps companies engage stakeholders across the organization in a truly integrated planning process that aligns their business to profitable solution.

Top Industries that use SAP Integrated Business Planning

Looking at SAP Integrated Business Planning customers by industry, we find that Information Technology and Services (23%), Food & Beverages (6%) and Manufacturing (5%) are the largest segments.

Top Countries that use SAP Integrated Business Planning

55% of SAP Integrated Business Planning customers are in United States and 6% are in Germany .

Distribution of companies that use SAP Integrated Business Planning based on company size (Employees)

Of all the customers that are using SAP Integrated Business Planning, a majority (59%) are large (>1000 employees), 13% are small (<50 employees) and 26% are medium-sized.

Distribution of companies that use SAP Integrated Business Planning based on company size (Revenue)

Of all the customers that are using SAP Integrated Business Planning, a majority (60%) are large (>$1000M), 23% are small (<$50M) and 7% are medium-sized.

Request companies using SAP Integrated Business Planning

What happens once i submit a request.

Someone from the Enlyft team will get back to you within 24 hours with more information.

How much is the cost?

The cost depends on various factors, such as number of records, number of products and use of advanced filtering and search criteria.

Will I start getting spam on my email?

Definitely not! We will not be adding you to an email list or sending you any marketing materials without your permission.

Trusted by some amazing companies

• Buyer Personas
• Buying Signals
• Buyer Intent
• Integrations
• Propensity Models
• Browser Extension
• Data Attributes
• Technology Targeting
• ISV Targeting
• MSP Targeting
• High Growth Companies
• Our Customers
• Microsoft Partners
• Legal center

More From Forbes

Sustainable business practices in the digital era: a multifaceted approach.

• Share to Facebook
• Share to Twitter
• Share to Linkedin

Salvador Ordorica is the CEO of The Spanish Group LLC , a first-class international translation service that translates over 90 languages.

Today, sustainability is more than just a buzzword; it's a strategic imperative in an interconnected world. Innovative approaches that harmonize environmental, social and economic sustainability can keep our planet and communities healthy while bolstering a thriving business.

As the CEO of The Spanish Group, I understand the transformative potential of an ethical and sustainable business philosophy in our digital age. Join me as we explore multifaceted strategies that drive sustainable success in this era. I'll share how companies can lead to a more sustainable future, from energy-efficient technologies to ethical work practices.

Environmental Sustainability

In today’s business landscape, compliance with environmental sustainability is central to being a good corporate citizen. Adding renewable energy sources such as solar, wind or hydroelectric power reduces a business’s dependence on fossil fuels and the impact of its greenhouse gas emissions.

Digitalization also plays a key role in slashing carbon footprints through its ability to optimize resource utilization, streamline operations and reduce waste. Meanwhile, ensuring that materials are responsibly sourced throughout the production process is integral to achieving environmental sustainability.

Top CEO Bets On A Shock Biden Crypto Flip As Congress Hurtles Toward A Crucial Vote That Could Blow Up The Price Of Bitcoin Ethereum And XRP

Iphone 16 pro max all new design upgrade promised insider claims, who is ebrahim raisi iran s president nicknamed butcher of tehran dies in helicopter crash.

By excelling in these areas of environmental sustainability, businesses can reduce their ecological footprint, increase their reputation by appealing to Earth-conscious consumers and play an active part in making the planet a healthier place for everyone.

Social Sustainability

Social sustainability in corporate responsibility builds inclusive, equitable societies. Ethical sourcing and labor practices ensure fair treatment, respect human rights and promote fair wages and working conditions. Diversity and inclusion initiatives foster a culture of belonging, celebrating individual differences and harnessing talent.

Community engagement and philanthropy provide evidence of a deep commitment to local communities, creating partnerships and solving social challenges. A positive work environment is created by prioritizing employee well-being and promoting work-life balance, increasing productivity, retention and overall satisfaction .

By championing these core principles of social sustainability, businesses not only contribute to the well-being of society but also build a strong brand, attract top talent and enhance their relationships with their many stakeholders.

Economic Sustainability

Economic sustainability is fundamental to the long-term success and resilience of businesses in an ever-changing market. Using innovative digital technology to identify and implement cost-saving measures boosts efficiency, productivity and competitiveness and reduces operating expenses.

Investing in sustainability as a long-term strategy delivers high returns , reduces risks and ensures business continuity in the face of evolving environmental and social landscapes. In addition, manufacturers communicate sustainability to produce consumer goods responsive to market preferences and offer competitive advantages.

Sustainability is also good for financial performance and shareholder value. This builds investor confidence and is critical to profitable operations over the long term.

Technological Innovation

Technological innovation is fundamental to driving sustainability. Digitalization and real-time monitoring, data analysis and optimal resource utilization can dramatically decrease waste and inefficiency. Technologies like the Internet of Things (IoT) are helping businesses across all verticals optimize everything from energy use to logistics. Some real-world examples of this include monitoring working conditions, tracking supply chain transparency and remote workforce monitoring.

Blockchain, a technology that brings unprecedented traceability and transparency to supply chains, is critical to help ensure a level of trust never before in sustainable sourcing and production. Additionally, artificial intelligence (AI) enables predictive analytics that can help anticipate environmental risks rather than simply react to them, optimize everything from supply chains to chemical formulations and extract intelligence from all data to remove any obstacles to intelligent growth.

Challenges And Opportunities

Here are some challenges and opportunities that might arise when practicing sustainable business.

Regulatory Compliance And Standards

Staying ahead of swiftly evolving regulations is critical to keeping the business not only compliant but also sustainable. The challenges may be complex, but the upside can be dramatic. Aligning with the most advanced standards can open up opportunities to spur innovation, not to mention gain greater competitive advantage, while others are playing catchup on the compliance front in the years ahead.

Consumer Awareness And Education

Educating consumers is just the beginning, whereas using that awareness to encourage more responsible consumption is the pot at the end of the rainbow. There are many challenges, such as consumer apathy and prior misinformation, to overcome. In my experience, I was able to overcome these challenges through things such as continuously educating consumers and providing them with transparent information about the sourcing, manufacturing and environmental footprints of our products.

The upside and potential lie not only in earning loyalty but also in meeting the growing demand for eco-responsible products, which can influence market behavior, including that of competitors, for years to come, thereby solidifying a company's brand for decades.

Collaboration And Partnerships For Sustainability

Not typically on the top of enterprises' skill sets, collaboration is vital to driving sustainability, especially on a global basis. The primary challenges here revolve around fostering collaboration beyond competitive boundaries and aligning diverse interests toward the common goal of driving sustainability.

Business leaders can foster a culture of collaboration by having open communication and dialogue among their teams, building partnerships and alliances across sectors to build on complementary strengths and offering incentives for collaboration.

Pooling those resources and collective expertise and creating the kind of economies of scale that amplify the impact on your shared goals (which is driving mutual success, one would hope) can pay off big.

Innovation In Business Models And Practices

The more innovative your organization is in sustainability, the more competitive advantage you can gain. However, once again, the challenges can get in the way—as forward-thinking as many multinational corporations have become, there's still entrenched management, resistance to major changes to any process and a lack of resources to implement these revolutionary solutions. Of course, the upside to finding them is the cost savings and even new markets that are arising for sustainable products and services.

Final Thoughts

In the digital era, sustainable business practices require a multifaceted approach. Through innovation, partnerships and regulatory compliance, organizations can pave the way for a brighter, sustainable future for the planet and all its inhabitants.

Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify?

• Editorial Standards
• Reprints & Permissions

• Starting a Business
• Growing a Business
• Small Business Guide
• Business News
• Science & Technology
• Money & Finance
• For Subscribers
• Write for Entrepreneur
• Entrepreneur Store
• United States
• Asia Pacific
• Middle East
• South Africa

Copyright © 2024 Entrepreneur Media, LLC All rights reserved. Entrepreneur® and its related marks are registered trademarks of Entrepreneur Media LLC

Beyond the Great Resignation — How to Attract Freelancers and Independent Talent Back to Traditional Work Discussing the recent workplace exit of employees in search of more meaningful work and ways companies can attract that talent back.

By Tyler King Edited by Chelsea Brown May 21, 2024

Key Takeaways

• The "Great Resignation" reflects a significant shift towards freelance and independent work driven by desires for flexibility, autonomy and more meaningful work.
• Strategies such as flexibility, project-based roles, alignment with modern values and career growth opportunities are crucial to re-attract and retain independent talent.
• The integration of freelancers can offer companies benefits like increased innovation, scalability, enhanced diversity and more, resulting in a symbiotic ecosystem for both traditional and independent workers.

Opinions expressed by Entrepreneur contributors are their own.

In recent years, the labor market has witnessed a profound transformation, called the " Great Resignation ," where record numbers of employees left their jobs in search of something more fulfilling. Many individuals now choose the path of freelancing and independent work over traditional employment. This shift is largely fueled by a quest for flexibility, autonomy and the pursuit of work that resonates on a personal level.

Technology has played a pivotal role in this transition, making it easier than ever for individuals to find freelance work, manage projects and communicate with clients from anywhere in the world. This digital revolution, combined with a growing cultural emphasis on work-life balance and meaningful employment, has made the freelance lifestyle more attractive and feasible.

However, the allure of independence doesn't just hinge on being one's own boss or setting one's hours. Many are drawn to freelance work because of the severe mismatches they perceive in traditional job environments, which often lack flexibility, fail to offer compelling career paths or neglect to align with modern values like sustainability and inclusivity.

Related: From the Great Resignation to Quiet Quitting, Here's Why Good People are Really Leaving and How to Keep Them.

Strategies to attract independent talent back to traditional work

As the landscape of work undergoes its most significant transformation in decades, traditional businesses must innovate not just to survive but to thrive. Here are several strategies that can help re-attract independent workers:

1. Flexibility and autonomy: One of the most cherished aspects of freelance life is the ability to control one's schedule and work environment. Traditional companies can appeal to this need by offering flexible working arrangements . This might include options for remote work, flexible hours and results-oriented performance metrics instead of strict clocking in and out. For example, a tech company could implement a "results-only work environment" (ROWE) where employees are judged solely on their output and not when or where they complete their work.

2. Project-based roles: Many freelancers enjoy the diversity of working on different projects, which keeps their daily routines dynamic and engaging. Companies can capture this interest by creating project-based roles or temporary positions that allow workers to contribute to specific initiatives with a clear end date. This approach not only satisfies the worker's need for variety but also gives companies the flexibility to scale labor up or down based on current needs.

3. Cultural alignment and values: Modern workers, particularly millennials and Gen Z , are increasingly drawn to companies that reflect their personal values. Businesses that prioritize sustainability, diversity, equity and inclusion are more likely to attract independent talent who are looking for more than just a paycheck. Publicizing initiatives and real impacts in these areas can make a traditional employment setting more appealing. For instance, a company might highlight its commitment to reducing carbon emissions or its active role in supporting local communities.

4. Professional development and career growth: Freelancers often invest in their own skill development to stay competitive. Companies that offer robust training programs, regular workshops and opportunities for career advancement can draw independents back into the fold. Highlighting a commitment to employee growth can assure potential hires that they will not stagnate but continue to develop professionally. An organization might, for example, offer an annual stipend for employees to attend conferences or take courses relevant to their jobs.

Related: "No One Wants To Work Anymore" Is a Phrase Old as Dirt. Here's How to Really Attract and Retain Employees in the New Age of Work

Benefits to companies and workers

The integration of independent talent back into traditional companies offers substantial benefits to both parties:

Increased innovation and creativity: Independent workers often bring fresh perspectives and innovative ideas gained from diverse project experiences. By incorporating these freelancers into their workforce, companies can foster a more creative environment, driving innovation. For instance, Google has leveraged independent contractors for various projects to inject new ideas and approaches, which has often led to breakthroughs in technology and user experience.

Flexibility and scalability: The ability to scale workforce capabilities up or down depending on project demands is a significant advantage for companies facing fluctuating market conditions. Freelancers provide a flexible labor pool that can be tapped into as needed, reducing the overhead associated with permanent staff while still meeting business goals.

Diversity of thought and skills: Freelancers typically work across a range of industries and disciplines, bringing a wealth of diverse skills and viewpoints that can enhance problem-solving and decision-making within traditional firms. This diversity can lead to better outcomes and a more resilient business model.

Enhanced employee satisfaction and retention: By adopting flexible work policies and valuing professional growth, companies can improve overall job satisfaction among all employees, not just freelancers. This can lead to higher retention rates and a more engaged workforce.

As the fabric of the workforce evolves into a mosaic of traditional employment, freelancing and independent contracting, businesses stand at a pivotal crossroads. The phenomenon known as the "Great Resignation" signifies a deeper, underlying shift — a redefinition of what it means to work and to be fulfilled by one's labor. This is not just a trend but a transformation in the ethos of work itself, driven by a generation that seeks purpose, autonomy and flexibility.

Related: The Best Employees Want More Than Just Money. Here Are 6 Ways to Attract Them.

Adapting to this new reality requires more than superficial changes; it demands a fundamental rethink of how businesses structure work, engage with employees and define their corporate culture. Strategies like enhancing workplace flexibility, embracing project-based roles, aligning organizational values with those of a changing workforce and fostering continuous professional development are vital. Yet, they are merely the starting point of a broader dialogue about work in the 21st century.

As business leaders, it is imperative to challenge the status quo and critically assess whether your current practices meet the needs of a diverse and evolving workforce. Engage in conversations with both your teams and independent professionals to understand their perspectives and needs . Implementing the discussed strategies should not be seen as a checklist to complete but as part of a larger, ongoing process of organizational transformation.

Explore collaborative models that benefit both your company and the independent talent. Such models should not only attract but also sustain a relationship that nurtures mutual growth, innovation and respect. The future of work isn't about choosing between traditional and independent paths but about creating an ecosystem where both can thrive together.

Entrepreneur Leadership Network® Contributor

CEO of Assuras, A Global Management Consulting Firm

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick Red Arrow

• Lock 3 Things Your Business Idea Must Have to Succeed — as Proven By Famous Harvard Business School Startups
• This Couple Cashed in Their 401ks to Launch a Virtual Business — Here's How It Led to a 9-Figure Exit and Co-Owning 2 Professional Soccer Teams
• Lock The No. 1 State to Retire in Might Not Even Be on Your Radar, According to a New Report
• Lock 12 Books That Self-Made Millionaires Swear By
• Lock These Are the Highest-Paying Side Hustles for a Single Day of Work
• Use These 3 Steps to Find the Perfect Franchise Opportunity for You

Most Popular Red Arrow

Make music from prompts with this ai subscription, just $50.

This AI music generator promises to take you from prompt to song in just a few seconds.

Scarlett Johansson 'Shocked' That OpenAI Used a Voice 'So Eerily Similar' to Hers After Already Telling the Company 'No'

Johansson asked OpenAI how they created the AI voice that her "closest friends and news outlets could not tell the difference."

How to Start an Event Planning Business: Your Comprehensive Guide

Not sure how to become an event planner? Use this step-by-step guide to launch your event planning business from scratch.

Now that OpenAI's Superalignment Team Has Been Disbanded, Who's Preventing AI from Going Rogue?

We spoke to an AI expert who says safety and innovation are not separate things that must be balanced; they go hand in hand.

Beyond the Great Resignation — How to Attract Freelancers and Independent Talent Back to Traditional Work

Discussing the recent workplace exit of employees in search of more meaningful work and ways companies can attract that talent back.

What Franchising Can Teach The NFL About The Impact of Private Equity

The NFL is smart to take a thoughtful approach before approving institutional capital's investment in teams.

Successfully copied link

• SUGGESTED TOPICS
• The Magazine
• Newsletters
• Managing Yourself
• Managing Teams
• Work-life Balance
• The Big Idea
• Data & Visuals
• Reading Lists
• Case Selections
• HBR Learning
• Topic Feeds
• Account Settings
• Email Preferences

How to Implement AI — Responsibly

• Michael Wade
• Tomoko Yokoi

Four ways nontechnical leaders can foster a culture that values ethical AI.

Researchers engaged with organizations across a variety of industries, each at a different stage of implementing responsible AI. They determined that, although data engineers and data scientists typically take on most responsibility from conception to production of AI development lifecycles, non-technical leaders can play a key role in ensuring the integration of responsible AI. They identified four key moves — translate, integrate, calibrate, and proliferate — that leaders can make to ensure that responsible AI practices are fully integrated into broader operational standards.

When the EU Parliament approved the Artificial Intelligence (AI) Act in early 2024, Deutsche Telekom, a leading German telecommunications provider, felt confident and prepared. Since establishing its responsible AI principles in 2018, the company had worked to embed these principles into the development cycle of its AI-based products and services. “We anticipated that AI regulations were on the horizon and encouraged our development teams to integrate the principles into their operations upfront to avoid disruptive adjustments later on. Responsible AI has now become part of our operations,” explained Maike Scholz, Group Compliance and Business Ethics at Deutsche Telekom.

• Michael Wade is a professor of innovation and strategy and the director of IMD Business School’s Global Center for Digital Business Transformation. He is a coauthor of ALIEN Thinking: The Unconventional Path to Breakthrough Ideas (PublicAffairs, 2021).

Partner Center

Solving your most complex planning challenges

Explore Industry Research

What do Gartner, Forrester, and IDC have in common? They all named Anaplan a planning leader.  

Your success is the heart of our success

Hear from our customers at Anaplan Connect 2024

Join us for a day of connected inspiration from your industry-leading peers who have found the answer in agile, connected enterprise planning.​

Transform how you see, plan and lead your business

Get started today.

Explore on-demand demos to discover how our modeling and planning capabilities are designed to meet the specific and unique needs of your business.

Transform how you see, plan, and lead your business

We’d love to find out how we can help you

Events, training, and content for your planning journey

Visit our blog and newsroom

Your hub for Anaplan updates, insights, perspectives, and innovations.

Powerful partnerships to drive your digital transformation and deliver game-changing strategies. 

Solutions for your business, your industry, from the world’s leading alliances.

• Sales & Marketing
• Supply Chain
• Manufacturing

Enabling Integrated Business Planning to Drive End-to-End Optimization

Learn about the journey Medtronic took to develop an Integrated Business Planning solution on Anaplan and how this process is driving positive business results. Hear how their organization addressed challenges and overcame obstacles to drive consistency and transparency to the forecasting process through the connection of previously siloed functions and processes with Anaplan.

Robert Darneal , Director Program Management - Integrated Business Planning, Medtronic

Matt Johnson , Managing Director, Deloitte

• Work & Careers
• Life & Arts

Become an FT subscriber

Try unlimited access Only $1 for 4 weeks

Then $75 per month. Complete digital access to quality FT journalism on any device. Cancel anytime during your trial.

• Global news & analysis
• Expert opinion
• Special features
• FirstFT newsletter
• Videos & Podcasts
• Android & iOS app
• FT Edit app
• 10 gift articles per month

Explore more offers.

Standard digital.

• FT Digital Edition

Premium Digital

Print + premium digital, ft professional, weekend print + standard digital, weekend print + premium digital.

Essential digital access to quality FT journalism on any device. Pay a year upfront and save 20%.

• Global news & analysis
• Exclusive FT analysis
• FT App on Android & iOS
• FirstFT: the day's biggest stories
• 20+ curated newsletters
• Follow topics & set alerts with myFT
• FT Videos & Podcasts
• 20 monthly gift articles to share
• Lex: FT's flagship investment column
• 15+ Premium newsletters by leading experts
• FT Digital Edition: our digitised print edition
• Weekday Print Edition
• Videos & Podcasts
• Premium newsletters
• 10 additional gift articles per month
• FT Weekend Print delivery
• Everything in Standard Digital
• Everything in Premium Digital

Complete digital access to quality FT journalism with expert analysis from industry leaders. Pay a year upfront and save 20%.

• 10 monthly gift articles to share
• Everything in Print
• Make and share highlights
• FT Workspace
• Markets data widget
• Subscription Manager
• Workflow integrations
• Occasional readers go free
• Volume discount

Terms & Conditions apply

Explore our full range of subscriptions.

Why the ft.

See why over a million readers pay to read the Financial Times.

International Edition

We've detected unusual activity from your computer network

To continue, please click the box below to let us know you're not a robot.

Why did this happen?

Please make sure your browser supports JavaScript and cookies and that you are not blocking them from loading. For more information you can review our Terms of Service and Cookie Policy .

For inquiries related to this message please contact our support team and provide the reference ID below.