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Difference between collaboration and consensus planning

Former Member
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Hi,

I am trying to understand the difference between the collaborative and consensus planning. I know what each one means.....

One of the questions I have on this is:

Consensus planning is within the company and allows the all departments to see the other department's data.

But in collaborative, the customer can only see his row and donot have access to other internal department's data.

Is my understanding correct?

Thanks.

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
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i guess you have looked at the example in the SAP help but i will anyhow put the link here in case it helps someone

for consensus planning

http://help.sap.com/saphelp_scm50/helpdata/en/0d/429bc338ee11d3982b0000e8a49608/content.htm

and collaborative planning

http://help.sap.com/saphelp_scm50/helpdata/en/3e/99ad39e4692453e10000000a114084/content.htm

Former Member
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Hi Harish,

I am under the impression that consensus is planning within the organization and collaboration is something across organizations. Please correct me if I am wrong,

rethinking about the two types, collaborative and consensus are not two different things. You can use the word collaborative when the other party is giving its input via web and consensus when you are actually sitting together and deciding something.

So in a business case,

when a sales department needs to give it's input, a collaborative view is made for them for their input just like a supplier and when the departments sit together and plan, it is a consensus planning.

I appreciate any comments.

Thanks.

Former Member
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you are right in "Consensus is within the organization and collaboration is across " typically....

Literally,

Consensus is when a group or people agrees on a decision. Departments within a company arrive at a decision on a forecast based on their knowledge. Consensus is a kind of collaboration as far as knowledge sharing goes but there is also the onus on the group of arriving at a single forecast to take forward.

Collaboration is when a group of people share knowledge which help each other making(their own) decisions. A companies procurement may or may not be affected by the suppliers market intelligence. A supplier's production plan may or may not be changed based on the forecast they recieve form the manufacturer

The collaboration is just a way of sharing each others view in advance in order to make their plans more robust. A single forecast is not essential

Answers (1)

Answers (1)

Former Member
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Hi Visu,

Pls find below the answer to your query:

Consensus Planning

Forecasters from different areas or departments have different business goals and therefore develop forecasts—such as the Strategic Business Forecast, the Tactical Sales Forecast and the Operational Supply Chain Forecast—according to their own aggregation levels, key figures, time horizons, and so on. For example, the marketing department focuses on brand or product group level and considers promotions in a medium term planning horizon, while the sales department forecasts for key customers and markets.

Consensus-based forecasting is a method that combines these different time horizons and forecasting levels from an organizational as well as from a tool perspective. Once all the parties involved in the demand planning process within a company have come up with their own individual forecasts, a consensus meeting is held. The result of this meeting is an overall demand plan that takes into account the business goals of all departments. The agreed demand plan is accepted by all parties. Moreover, all parties feel responsible for this demand and identify themselves with the output. Different demand streams get combined into "one figure".

Collaborative Planning : It is to help enterprises carry out collaborative supply chain planning activities with their business partners. Thus, relevant input from business partners can be taken into account to synchronize planning across the network and leverage APO to generate optimized plans based on data from the supply network. Enterprises can now focus on enhancing customer value by enabling true business collaboration across business partners in their networks .

Internet and associated technologies such as XML have revolutionized inter-enterprise business processes by enabling seamless information exchange between business partners. High volumes of data can be transferred at low cost and even minor business partners can exchange information in an economical manner. Interactive on-line access to each other’s systems can be achieved easily via a conventional Internet browser.

APO CLP is the building block which enables enterprises to collaboratively plan all logistics activities ranging from forecasting to shipment planning together with their business partners. Collaborative Planning extends the boundaries of supply chain management to include all relevant business partners and enable collaborative business processes across the network. The distinct entities in the network such as suppliers, manufacturers, and retailers can cooperate and act as a single entity focused on delivering enhanced customer value while reducing costs throughout the entire chain.

Award points if helpful.

Reg

Sachin

Former Member
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Hi Sachin,

I appreciate you giving so much information. But when I said "I know what each one means..... ", I meant I knew what each ones functionality. May be the title of the post is misleading.

In fact, my question is about amount of data visibility in both the cases.

Example:

If I am a sales guy and participating in consensus, would I be able to see finance input also as opposed to in collaboration, as a customer, I am given limited access and I can only enter my input but not as much as the sales division can.

I think I am clear in my question now.

Thanks.

Former Member
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visu.. my 2cents on this

There is no one answer to this so this is from a little experience in the subject

While both are based on the business process of planning, Collaborative planning is more technologically enhanced by the internet.

A typical S&OP process in an organization would invovle various teams giving inputs at different levels and in many places involving a(or many) consensus meetings in order to arrive at a "single number" forecast after which the forecast is frozen and planning done

Depending on the organization there may or may not be restriction on what you can see and what cannot be

Also the level at which forecasting is done is different based on the functionality

Finance might be looking at the strategic need for a business to make money and might give a budget and marketing might have a budget based on product groups based on their research while the sales guys on the ground would have a different number based on the enquiries at a product level...

So in this case you would have three rows for forecast, you also have the demand planner who comes up with the system calculated forecast based on historical trends...

A lot of managers want to see individual number from different groups to get a perspective and arrive at a consensus based on the logic used... in some other places finance numbers might just be used as a guideline for a tolerance levels to know the plans meet the Business strategy for the year or month

The consensus meetings are designed such that the slicing and dicing of data and the aggregation gives a satisfactory number at all levels.

As a consultant it would be prudent to check how the business does their current consensus forecasting and if they are interested in modelling the same in APO. Or if they want to devise a new process based on the functionality available

would be a good idea to also search the web for top-down forecasting or bottom up forecasting

Collaborative forecasting is the manufacturer letting the suppliere know his demand and the supplier letting know how much of it he can make and so on...all on the internet..