Integrated business planning
Integrated Business Planning is a planning process that integrates across two or more functions in a business or government entity referred to as an enterprise to maximize financial value.
The specific functional areas in a company as well as the industry domain associated with the company defines the specific type of IBP process. Examples of IBP processes are:
->Sales and Operations Planning
->Strategic Corporate Performance Management
->Planning and scheduling across multiple plants in a factory
The key requirement for IBP is that two or more functional process areas must be involved and maximizing (optimizing) of financial value should be done.
Corporate executives, business unit heads and planning managers use IBP to evaluate plans and activities based on the economic impact of each consideration.
Bridging Corporate Performance Management and S&OP There has been a lot of focus on Integrated Business Planning in the context of Sales and Operations Planning. Gartner (www.gartner.com) refers to a 5-stage S&OP Maturity model wherein IBP is referred to as the Phased 4 & 5.
Integrated Business Planning however is more broader than S&OP. It is an approach that that combine enterprise performance management (EPM) and sales and operations planning (S&OP) to provide incremental capabilities that neither provides individually. In so doing, IBP platforms address long-standing challenges that financial and operational professionals have struggled to overcome. The result: opportunities for step change improvements to how manufacturers plan, manage and govern their business.
Integrated Business Planning requires the following capabilities to be enabled::
a) Enterprise Model
- Ability to create a demand chain model
- Ability to create a supply chain model
- Ability to create a finance chain model
b) Integrated Planning
- Ability to create a plan across multiple functions
- Ability to create predictive and collaborative plans
c) Enterprise Optimization
- Ability to create optimized plans across multiple constraints
- Ability to create financial integration across optimization
IBP has been used to model and integrate the planning efforts in a number of applications, including:
- Product profitability
- Customer profitability
- Capital expenditures
- Manufacturing operations
- Supply chain
- Business processes (human and information-based)
- Business policy
- Market demand curves
- Competitive strategy
All of the above can be summarized as Enterprise Optimization use cases.
- https://www.gartner.com/doc/2587021/introducing-fivestage-sales-operations-planning. Missing or empty
- "IBP Industry Week cite web".
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