How To buy a Planning System

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It is somewhat amusing to observe the intricate gyrations a company will go through when trying to decide on the selection of a merchandising system. This is especially so when compared to the decision process undertaken when purchasing a new planning system.

While the former usually involves, rightfully, a wide cross section of the companies' staff and management, the later hardly rates a 1.0 on the Richter scale.

When it comes to a planning system, many companies are usually willing to pretty much wing it.

There is in fact no great correlation between the sophistication of a planning system and the effectiveness of merchandise planning and inventory management.

A very good example of this is the GAP. Part of what makes the GAP so very successful is the science that they have made out of inventory management and planning. They do not have a new look in the window every six weeks by accident. That happens very deliberately. The rotating of inventories and the presentation of that inventory at store level occurs because the company works together to make that happen.

The single key factor in achieving that goal is good, integrated merchandise planning. The key is the dedication to planning as a function, not the bells and whistles that come with some of the newer 'best of breed' systems.

This is not to say that 'anything off the shelf' will do. The planning system chosen must be linked tightly to the merchandising system. The planning system chosen must be able to represent the process of how the company plans its merchandise. The entire process of item selection, pricing, buying, allocation and replenishment must be managed via the planning system and correlated back to the merchandising system.

The selection process itself cannot be done in a vacuum of information. The planners must of necessity be very much part of the investigative process. To the same extent, so should the merchants. For a planning process to work, the merchants and planners must be closely tied in their functions. It only makes the most sense that the system that will be used to assist in this most important function be reviewed by all the players involved.

It does not matter if your company does Top Down, Bottom Up, what have you. The integration of a planning process is the key factor. The culture of planning as a way of doing business must be ingrained throughout the organization.

When the time comes for the necessary review of the planning systems being considered, keep a few key points in mind:
  • Work with someone who not only knows the application, but someone who knows Planning! This person will not only talk the talk, but also be able to really relate to the real life issues you face.
  • Involve as many of the planners as possible and get good input from the your leading buyers.
  • Develop your process first!
  • Shop the process.
  • Select the planning system that most clearly supports your process.