integrated business planning capabilities

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.

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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.

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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.

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Supply-chain resilience: Is there a holy grail?

Imagine a symphony orchestra where each musician plays their own tune without listening to others. The result would be chaotic and dissonant, right? Similarly, in the business world, when decision-making happens in silos and planning processes are disconnected, it’s like having a group of individuals playing their own instruments without any coordination. The harmony is lost, and the organization becomes inefficient, misses opportunities, and struggles to keep up with the fast-paced market.

Integrated Business Planning (IBP) addresses these challenges by providing a comprehensive framework that integrates strategic, operational and financial planning, analysis, and reporting to drive better business outcomes.    A retail company experiences a sudden surge in online sales due to a viral social media campaign. Integrated planning incorporates supply chain planning, demand planning, and demand forecasts so the company can quickly assess the impact on inventory levels, supply chain logistics, production plans, and customer service capacity. By having real-time data at their fingertips, decision-makers can adjust their strategies, allocate resources accordingly, and capitalize on the unexpected spike in demand, ensuring customer satisfaction while maximizing revenue.   This blog explores the significance of IBP in today’s modern business landscape and highlights its key benefits and implementation considerations.

Integrated business planning framework

Integrated Business Planning (IBP) is a holistic approach that integrates strategic planning, operational planning, and financial planning within an organization. IBP brings together various functions, including sales, marketing, finance, supply chain, human resources, IT and beyond to collaborate across business units and make informed decisions that drive overall business success. The term ‘IBP’ was introduced by the management consulting firm Oliver Wight to describe an evolved version of the sales and operations planning (S&OP process) they originally developed in the early 1980s.

Making up the Integrated Business Planning framework are six key pillars:

1. strategic planning.

Integrated Business Planning starts with strategic planning. The management team defines the organization’s long-term goals and objectives. This includes analyzing market trends, competitive forces, and customer demands to identify opportunities and threats. Strategic planning sets the direction for the entire organization and establishes the foundation for subsequent planning roadmap.

2. Operational planning

Operational planning focuses on translating strategic goals into actionable plans at the operational level. This involves breaking down the strategic objectives into specific targets and initiatives that different departments and functions need to execute.

For example, the sales department might develop a plan to enter new markets or launch new products, while the supply chain department focuses on inventory optimization and ensuring efficient logistics. The key is to align operational plans with the broader strategic objectives to ensure consistency and coherence throughout the organization.

3. Financial planning

Financial planning ensures that the organization’s strategic and operational plans are financially viable. It involves developing detailed financial projections, including revenue forecasts, expense budgets, and cash flow forecasts. By integrating financial planning with strategic and operational planning, organizations can evaluate financial profitability, identify potential gaps or risks, and make necessary adjustments to achieve financial targets.

 4. Cross-functional collaboration

A fundamental aspect of IBP is the collaboration and involvement of various functions and departments within the organization. Rather than working in isolation, departments such as sales, marketing, finance, supply chain, human resources, and IT come together to share information, align objectives, and make coordinated decisions.

5. Data integration and analytics

IBP relies on the integration of data from different sources and systems. This may involve consolidating data from enterprise resource planning (ERP) systems, customer relationship management (CRM) systems, supply chain management systems, and other relevant sources. Advanced analytics and business intelligence tools are utilized to analyze and interpret the data, uncovering insights and trends that drive informed decision-making.

6. Continuous monitoring and performance management

The Integrated Business Planning process requires continuous monitoring of performance against plans and targets. Key performance indicators (KPIs) are established to measure progress and enable proactive management. Regular performance reviews and reporting enable organizations to identify deviations, take corrective actions, and continuously improve their planning processes.

What are the benefits of Integrated Business Planning?

By integrating strategic, operational, and financial planning organizations can unlock the full potential of IBP and drive business success and achieve their goals.

Enhanced decision-making

IBP facilitates data-driven decision-making by providing real-time insights into various aspects of the business. By bringing together data from various departments, organizations can develop a holistic view of their operations, enabling them to make better-informed decisions.

Improved alignment

By aligning strategic objectives with operational plans and financial goals, IBP ensures that every department and employee is working towards a common vision. This alignment fosters synergy and drives cross-functional collaboration.

Agility and responsiveness

In the rapidly changing business landscape, agility is crucial. IBP allows organizations to quickly adapt to market shifts, demand fluctuations, and emerging opportunities. By continuously monitoring and adjusting plans, businesses can remain responsive and seize competitive advantages.

Optimal resource allocation

Integrated Business Planning enables organizations to optimize resource allocation across different functions. It helps identify bottlenecks, allocate resources effectively, and prioritize initiatives that yield the highest returns, leading to improved efficiency and cost savings.

Risk management

IBP facilitates proactive risk management by considering various scenarios and identifying potential risks and opportunities. By analyzing data and conducting what-if analyses, companies can develop contingency plans and mitigate risks before they materialize.

Essential steps for implementing Integrated Business Planning

Implementing an effective IBP process requires careful planning and execution that may require substantial effort and a change of management, but the rewards are well worth it. Here are some essential strategic steps to consider:

1. Executive sponsorship

Establish leadership buy-in; gain support from top-level executives who understand the value of Integrated Business Planning and can drive the necessary organizational changes. Leadership commitment, led by CFO, is crucial for successful implementation.

2. Continuous improvement

Continuously monitor and adjust; implement mechanisms to monitor performance against plans and targets. Regularly review key performance indicators (KPIs), conduct performance analysis, and generate timely reports and dashboards. Identify deviations, take corrective actions, and continuously improve the planning processes based on feedback and insights.

3. Integration of people and technology

To foster cross-functional collaboration, the organization must identify key stakeholders, break down silos, and encourage open communication among departments. Creating a collaborative culture that values information sharing and collective decision-making is essential.

Simultaneously, implementing a robust data integration system, encompassing ERP, CRM, and supply chain management systems, ensures seamless data flow and real-time updates. User-friendly interfaces, data governance, and training provide the necessary technological support. Combining these efforts cultivates an environment of collaboration and data-driven decision-making, boosting operational efficiency and competitiveness.

4. Technology

Implement advanced analytics and business intelligence solutions to streamline and automate the planning process and assist decision-making capabilities.  These solutions provide comprehensive functionality, data integration capabilities, scenario planning and modeling, and real-time reporting.

Integrated Business Planning software

From a tech perspective, organizations need advanced software solutions and systems that facilitate seamless data integration and collaboration to support IBP. Here are some key components that contribute to the success of integrated business planning:

1. Corporate performance management

A platform that serves as the backbone of integrated business planning by integrating data from different departments and functions. It enables a centralized repository of information and provides real-time visibility into the entire business.

2. Business intelligence (BI) tools

Business intelligence tools play a vital role in analyzing and visualizing integrated data from multiple sources. These tools provide comprehensive insights into key metrics and help identify trends, patterns, and opportunities. By leveraging BI tools, decision-makers can quickly evaluate financial performance, make data-driven business decisions and increase forecast accuracy.

3. Collaborative planning and forecasting solutions

Collaborative planning and forecasting solutions enable cross-functional teams to work together in creating and refining plans. These planning solutions facilitate real-time collaboration, allowing stakeholders to contribute their expertise and insights. With end-to-end visibility, organizations can ensure that plans are comprehensive, accurate, and aligned with business strategy.

4. Data integration and automation

To ensure seamless data integration, organizations need to invest in data integration and automation tools. These tools enable the extraction, transformation, and loading (ETL) of data from various sources. Automation streamlines data processes reduces manual effort and minimizes the risk of errors or data discrepancies.

5. Cloud-based solutions

Cloud computing offers scalability, flexibility, and accessibility, making it an ideal choice for integrated business planning. Cloud-based solutions provide a centralized platform where teams can access data, collaborate, and make real-time updates from anywhere, at any time. The cloud also offers data security, disaster recovery, and cost efficiencies compared to on-premises infrastructure.

6. Data governance and security

As organizations integrate data from multiple sources, maintaining data governance and security becomes crucial. Establishing data governance policies and ensuring compliance with data protection regulations are vital steps in maintaining data integrity and safeguarding sensitive information. Implementing robust data security measures, such as encryption and access controls, helps protect against data breaches and unauthorized access.  

IBM Planning Analytics for Integrated Business Planning

IBM Planning Analytics   is a highly scalable and flexible solution for Integrated Business Planning. It supports and strengthens the five pillars discussed above, empowering organizations to achieve their strategic goals and make better data-driven decisions.  With its AI- infused advanced analytics and modeling capabilities, IBM Planning Analytics allows organizations to integrate strategic, operational, and financial planning seamlessly. The solution enables cross-functional collaboration by providing a centralized platform where teams from various departments can collaborate, share insights, and align their plans.  IBM Planning Analytics also offers powerful data integration capabilities, allowing organizations to consolidate data from multiple sources and systems, providing a holistic view of the business. The solutions’s robust embedded AI predictive analytics uses internal and external data and machine learning to provide accurate demand forecasts. IBM Planning Analytics supports continuous monitoring and performance management by providing real-time reporting, dashboards, and key performance indicators (KPIs) that enable organizations to track progress and take proactive actions.  As the business landscape continues to evolve, embracing Integrated Business Planning is no longer an option but a necessity for organizations. To succeed in this dynamic environment, businesses need an integrated approach to planning that brings all the departments and data together, creating a symphony of collaboration and coordination.

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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.

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To minimize the impact of disruptions, improve customer satisfaction, and promote sustainability, organizations rely on fast and flexible supply chain planning. SAP Integrated Business Planning for Supply Chain enables businesses to centralize demand, supply, inventory, sales, and operations planning on one platform to create more efficient and resilient supply chains. With embedded analytics, what-if simulations, alerts, and other machine learning capabilities, you can quickly identify and respond to disruptions, reduce costs, optimize inventory, and improve forecasting.

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• 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.

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/ 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.

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Integrated Business Planning

How to Integrate Planning Processes, Organizational Structures and Capabilities, and Leverage SAP IBP Technology

• © 2018
• Robert Kepczynski 0 ,
• Raghav Jandhyala 1 ,
• Ganesh Sankaran 2 ,
• Alecsandra Dimofte 3

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• Describes the Integrated Business Planning from the perspective of business and technology practitioners
• Covers in one book people, process and technology integration as key to success
• Considers operational, tactical and long term process implications

Part of the book series: Management for Professionals (MANAGPROF)

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Table of contents (9 chapters)

Front matter, recent past disconnected planning.

• Robert Kepczynski, Raghav Jandhyala, Ganesh Sankaran, Alecsandra Dimofte

Why Move to Integrated Business Planning

What makes integrated business planning, how to run ibp: use cases, how to manage organization and capability change, how to enable change with sap ibp technology, how to measure transformation success, how to build transformation path, “quo vadis” integrated business planning.

• sales and operations planning
• business transformation
• demand planning
• demand management
• finance in sales and operations planning
• organizational structures
• capabilities

About this book

Authors and affiliations.

Robert Kepczynski

Raghav Jandhyala

Ganesh Sankaran

Alecsandra Dimofte

About the authors

Robert Kepczynski has more than 20 years’ experience in supply chain management and technology. Robert does assess, design and implement people capability models, process design and delivers efficient technology solutions. He is specialized in supply chain planning processes and technologies. Robert took business roles in plant supply / production planning and sequencing, inventory and materials management, warehouse and duty operations, costing and budgeting, in market IBP and S&OP, distribution planning, and in regional & global S&OP, forecasting, demand planning and demand management, and process ownership. Robert led x-functional transformation programs delivering functional optimization and differentiation. His production plant, market and global process experiences was valued in the 2nd worldwide SAP IBP implementation, which has started in 2013. This project proved that Robert has heart, head and hand for IBP.

Raghav Jandhyala is a Senior Director of ProductManagement at SAP for SAP IBP responsible for sales and operations planning and unified planning processes and best practices in IBP. Raghav has over 16 years of experience in different fields like Supply Chain Management, Retail and Banking along with strong technical background in development and adoption of business applications. Raghav held various roles in his career as business consultant, development architect, solutions manager and product manager. Raghav is responsible for developing the roadmap for S&OP solution and works with multiple IBP Customers for new innovations and as a trusted advisor for their global rollouts.

Ganesh Sankaran is a Supply Chain Management technology practitioner. Ganesh helps clients solve business problems and generate value from their supply chain processes, particularly in the planning domain. Ganesh possesses a skillset that combines deep theoretical insights in SCM and rich implementation experience in SAP solutions further enriched by around seven years of prior software development experience.

Alecsandra Dimofte is working for SAP where she started as a supply chain management consultant. Alecsandra was involved in several IBP / S&OP implementation projects which allowed her to play different roles, from integration consultant to functional design lead. Alecsandra contributed to the development of the S&OP practice within her delivery unit and to the growth of the IBP online community by active participation in the space dedicated to IBP.

Bibliographic Information

Book Title : Integrated Business Planning

Book Subtitle : How to Integrate Planning Processes, Organizational Structures and Capabilities, and Leverage SAP IBP Technology

Authors : Robert Kepczynski, Raghav Jandhyala, Ganesh Sankaran, Alecsandra Dimofte

Series Title : Management for Professionals

DOI : https://doi.org/10.1007/978-3-319-75665-3

Publisher : Springer Cham

eBook Packages : Business and Management , Business and Management (R0)

Copyright Information : Springer International Publishing AG, part of Springer Nature 2018

Hardcover ISBN : 978-3-319-75664-6 Published: 12 June 2018

Softcover ISBN : 978-3-030-09292-4 Published: 11 February 2019

eBook ISBN : 978-3-319-75665-3 Published: 31 May 2018

Series ISSN : 2192-8096

Series E-ISSN : 2192-810X

Edition Number : 1

Number of Pages : XIII, 265

Number of Illustrations : 237 b/w illustrations

Topics : Business Process Management , Information Systems Applications (incl. Internet) , Sales/Distribution , Supply Chain Management , Business Information Systems

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Integrated Business Planning: Navigating Volatility, Creating Resiliency

The big picture: Challenging market conditions and volatility are driving the need for organizations to have greater resiliency, agility and flexibility to maximize profit while reducing risk.

Between the lines: FP&A, profitability, reporting and analysis, strategic planning, enhanced data analytics and process improvement are top areas where CFOs are seeking to improve capabilities, according to Protiviti’s recent CFO survey .

What’s new: Integrated business planning (IBP), a methodology to assess challenges and risks throughout the organization with transparency, can help business leaders navigate today’s challenging environment by integrating planning and execution across sales, finance, supply chain, sourcing, procurement and operations.

___  ____  ___

Wouldn’t it have been great if, through the worst of the COVID-19 pandemic, businesses could have modeled the impacts resulting from consumers in isolation and made their decisions accordingly? Market conditions clearly have become very challenging over the past few years. Business leaders have taken note and are beginning to understand that integrated business planning (IBP) is key to navigating market volatility and creating resiliency. IBP integrates planning and execution across sales, finance, supply chain, sourcing, procurement and operations to maximize profit and cash flow while reducing risk.

IBP programs often originate with financial planning and analysis (FP&A) leaders, who are increasingly called on to inform leadership with forecasts and business insights. In Protiviti’s recent CFO survey , FP&A, profitability, reporting and analysis, strategic planning, enhanced data analytics and process improvement are top areas where CFOs are seeking to improve capabilities. All of these areas are relevant to IBP and to generating better insights, not only to define near-term tactics, but also to inform longer-term strategic planning.

The volatility we’ve come to know drives the need for greater resiliency, agility and flexibility. FP&A can’t carry the ball alone. No single function will have all the answers – nor the data or business expertise – to address complex business forecasting challenges. But organizations that embrace IBP can address them by developing cross-functional collaboration and process and systems maturity to achieve visibility and transparency throughout the enterprise.

IBP is only as good as the foundation that supports it

One of the top challenges to succeeding with IBP is harmonization of functions across the organization, particularly between finance and supply chain functions. Over time, each function may have developed its own language or have its own variation in the maturity of its data, processes and technology. For IBP to be effective, all functions must commit to ongoing collaboration, overcoming cultural differences and understanding each other’s objectives and constraints. Creating awareness and educating the various functions about key priorities of each will help overcome the typical roadblocks encountered so the groups can build the integrated business plan together and revise the plan efficiently to respond to a changing environment.

Process improvement is also essential, because it results in defined handoffs between functions and ensures that all parties are aware of their roles and responsibilities. Standardizing and rationalizing processes and instituting a governance structure over the end-to-end IBP process will also help reduce or eliminate duplication of efforts. Developing maturity across functions helps support a strong foundation that is critical to IBP success.

Automation is key to increasing organizational agility, building flexibility in reporting and enhancing planning capabilities. Automation between systems reduces manual work to improve efficiency and reduce errors. Depending on the company’s technology strategy, various solutions can offer a foundation for IBP that provides timely, agile scenario-planning capabilities that are needed as part of IBP. Additionally, supply chain platforms can provide a unified view of enterprise data gathered from a variety of point solutions and provide a solid basis for automation. However, automating flawed processes is a common misstep, so it’s critical for organizations to examine and correct any outdated or imperfect processes before automating them.

Many leaders leverage digital-process twins as a mechanism to adjust processes and then conduct simulation and scenario modeling to better understand how processes will perform under changing constraints. These simulations can help mitigate potential risks and plan responses in advance of volatility-inducing events. Data analytics and digital twins are solutions that rely on quality data to deliver those capabilities. These solutions are more accessible now than some leaders may realize, and they often include user-friendly front ends so nontechnical professionals can simulate scenarios in natural language.

Some leaders look to artificial intelligence (AI) for its promise to deliver better information faster. Practical applications in the planning realm, however, are currently limited. While AI promises much in predictive analytics, IBP leverages descriptive analytics: accurate, real-time views that improve production planning, supplier communications, and production and distribution capabilities. Those improvements can’t proceed without a solid view of what’s happening today.

Automation, data analytics, digital twins and other solutions are only as good as the data they consume. Some leaders are choosing to establish centers of excellence that provide governance over data analytics and that take charge of reporting and data rationalization enterprisewide. Some include heightened business knowledge in the center’s skill set. These data analytics centers of excellence analyze enterprise information needs and identify data sources to meet them.

Forecasting challenges unlocked by collaboration

Business leaders today face a future that will remain volatile, but IBP is a methodology to assess challenges and risks throughout the organization with transparency. The power of this approach is realized when the functions develop cohesive forecasts together, supported by mature processes and systems and integrated, quality data. IBP unlocks deep insights to deliver the resiliency and agility volatile conditions demand.

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How collaboration can improve integrated business planning.

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Igor Rikalo is President and COO at o9 Solutions .

Over the past few years, supply chain managers and leaders have spoken at length about adjusting to the new normal of supply chain volatility.

In response to the flurry of uncertainties, another factor that has been shaping supply chain management is the continued adoption of or reinvestment in integrated business planning (IBP), which is a strategic planning process that links multiple business functions to determine capabilities, resources and results.

How can you develop effective IBP processes?

According to McKinsey, effective IBP processes often include the following components : a business-backed design framework, quality data inputs and outputs, accountability management, effective technology and tools, analytics and metrics measurement and specialized capabilities and roles.

Each of these aspects significantly contributes to developing a robust IBP process that can help companies develop resilient supply chains that can be more responsive to constraints and disruptions.

One aspect to keep in mind is that implementing IBP processes isn’t just about replacing traditional enterprise planning models with a more modern approach or even implementing new cross-departmental processes that everyone within the organization is expected to adhere to.

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Transitioning to IBP, on the other hand, can be an opportunity to transform an organization’s entire supply chain to better meet today’s business challenges but also anticipate the needs of the future. One of the keys to transformative IBP is building a culture of collaboration. It’s about shifting your workforce’s mindset from being expected to coordinate information with fellow teams to actively seeking to openly collaborate, share information and align activities to meet business goals.

This article will explore how executives can help pave the way for a collaborative mindset to take hold across an organization:

It starts at the top.

Fostering collaboration across an organization begins at the leadership level. While a collaborative leadership style differs in many ways from the more traditional "command and control" approach , the influence leaders have still has a top-down impact on the entire workforce and sets the tone for an organization’s accepted norms.

At the executive level, collaborative behaviors may take the shape of a shared vision or goals that all employees can feel invested in. This approach empowers employees to share knowledge across organizational networks and work together to find solutions, as well as to seek multiple perspectives from team members and stakeholders before making final decisions on the best way to move forward.

One of the key factors in fostering a collaborative culture that takes hold across the organization is to create an environment where a sense of belonging, psychological safety and trust in one another can thrive. In this type of environment , teams that are expected to work together are more engaged and are more likely to share concerns constructively. Therefore, issues that arise during an IBP implementation (and it's a matter of when, not if) can be addressed early and resolved instead of becoming potential detriments to a project’s success.

Soft skills are key.

When implementing an IPB program, upskilling employees to use new processes and software is imperative. But while most organizations may be preoccupied with ensuring the technical aspects or hard skills are acquired across the workforce, learning soft skills can be just as important when fostering team collaboration.

Applicable soft skills can include problem-solving capabilities, organizational skills and time management, as well as interpersonal skills like communication, active listening, negotiation, emotional intelligence and providing effective feedback. The benefits of soft skills include building stronger rapport with colleagues, improved team working dynamics and the ability to adapt to changes—which is paramount during an IBP implementation.

If your organization would like to provide your workforce with resources to build up their soft skills, online learning platforms like LinkedIn Learning and Coursera as well as "lunch and learns" can be great places to start. It’s also important for employees to build soft skills like active listening, problem-solving and teamwork in their day-to-day roles as well.

Adopt a unified source of information and a relationship-building mindset.

Historically, cross-departmental teams that are brought together to work on initiatives often do so in siloed ways that hinder true collaboration , according to research conducted by Harvard Business Review .

However, in today’s business world, team-focused collaborative leadership styles can have a positive influence on team performance , according to 2021 research study. One of the benefits of IBP is the ability to engage in strategic initiatives across multiple departments (e.g., supply chain planning, finance, procurement, sales, etc.) in a way that can unify planning, information sharing and decision-making processes.

Technology platforms can provide the data and market insights that act as a single source of information that teams can use collectively to make strategic planning efforts more transparent and aligned to larger business goals.

But beyond this, teams also have to actively collaborate and gain a greater understanding of each department’s respective goals, identify any similar initiatives across departments (e.g., increase profitability and productivity) and build key performance indicators (KPIs) that keep teams accountable and align to a business’s mid- and long-term objectives.

The Harvard Business Review study suggests bringing on leaders who are both task- and relationship-oriented. Researchers found that once the business goals and objectives were outlined and specific accountabilities were assigned, successful leaders switched from being task-focused to adopting a relationship-building mindset—right at the point when tensions around sharing knowledge and information started to emerge. The ability to switch flexibly from one style of leadership to another reduced the chance the project would be hindered.

Overall, when leaders add a culture of collaboration along with the technology, data sets, processes and people that align with an organization’s IBP goals, it creates an environment where IBP isn’t just seen as a supply chain management strategy but as a catalyst for transforming planning practices and information sharing across the organization.

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Integrated Business Planning

Key Processes Supported

• Target Setting
• S&OP Consensus Forecast
• Supply Integration
• Distribution Management

IBP forecast

Integrated “starting point”, spreadsheet-like copy/paste, automatic spreading, automatic rollup, near real-time, specialized dashboard, post event analysis.

• Ability to execute more business process in one platform
• Avoid time, effort, and cost attributable to homegrown tool construction and maintenance
• Eliminate risk of accidental corruption or deletion
• Automatic presentation of data used to create the forecast
• Structure that ensures consistency across users
• Reduced learning curve because system has been designed around best practices
• Flexibility to configure for your specific needs

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Join this free online course to learn about SAP Integration Suite, the enterprise integration platform as a service (iPaaS) that enables you to integrate, automate, and transform business processes with integration capabilities across SAP and third-party landscapes.

Please note: There is additional learning material related to the topic of this course available on the SAP Learning site I Learning Journey Developing with SAP Integration Suite I Learning Journey Getting Started with SAP Integration Solution Advisory Methodology .

Course information

Course summary.

In today’s digital age, every organization is looking to evolve its IT landscape to become a leader or maintain leadership in its markets. A major factor in this transformation is ensuring that the systems in the landscapes are connected and have a seamless information flow to deliver the relevant, contextual data that drives business.

The key to getting this right is to ensure that the organization has a clearly defined enterprise-wide integration strategy. SAP Integration Suite provides our customers with a best-in-class, reliable, and holistic enterprise integration platform as a service (iPaaS) that supports the “any-to-any” integration requirements that are evolving in the market today.

In this course, you’ll learn and experience the different capabilities of SAP Integration Suite and how integration is a key enabler for digitalization. The suite empowers you to integrate, automate, and transform your business processes with speed and confidence across SAP and third-party landscapes. It helps people with different skills to leverage a wide variety of integration approaches, intuitive tools, and prepackaged content. This enables you to achieve results faster and gain business agility with a versatile, dynamic, and enterprise-grade cloud integration platform. We’ll walk you through several use case scenarios and show you the different capabilities in action.

By the end of the course, you’ll know how to leverage the power of SAP´s enterprise-grade integration platform-as-a-service (iPaaS) to modernize, innovate, and quickly transform your enterprise into an intelligent and sustainable enterprise.

Course Characteristics

• Starting from: September 25, 2023, 09:00 UTC. ( What does this mean? )
• Duration: 4 weeks (3 hours per week)
• Final exam: October 23, 2023, 9:00 UTC – October 31, 2023, 9:00 UTC
• Course language: English
• How is an openSAP course structured?

Course Content

Week 1: Introduction Week 2: Elevate Your Integrations Week 3: API and Event-Based Integration Week 4: Application, Business, & e-Government Integration Week 5: Final Exam

Target Audience

• Integration developers and architects
• Application developers
• Project managers and consultants
• Anyone involved in or interested in SAP Integration Suite

Course Requirements

• Fundamental understanding of SAP Business Technology Platform
• Basic knowledge of integration technologies and concepts
• Knowledge of interface design and mapping of interfaces

Development Systems

Details on development system preparation and the corresponding links will be shared and available when the course is running. All described systems are free-of-charge. Please note: This course is in self-paced mode since October 31,2023. Therefore the practical system exercises are not supported anymore. The discussion forum is closed and questions cannot be answered anymore by our experts.

Further Learning

Visit our earlier openSAP course - Simplify Integration with SAP Cloud Platform Integration Suite

About Further Content Experts

Richard kleibl.

Richard Kleibl leads the PI Elevation project. The goal of the project is to support the transformation from SAP Process Orchestration to SAP Integration Suite. The project provides tools and content which support this transformation journey. Richard’s focus areas include SAP Integration Suite and integration technologies.

Alexander Bundschuh

Alexander Bundschuh is a product manager at SAP for SAP Integration Suite, SAP Process Orchestration, and SAP Application Interface Framework. He works closely with customers and partners, channeling back their feedback to development. Alexander drives the integration flow design guidelines and contributes frequently to SAP Community, answering questions and writing blogs and tutorials.

Follow Alexander on SAP Community

Chaim Bendelac

Chaim Bendelac is a lead program manager in SAP Integration Suite, with a passion for helping developers to get the most out of APIs, via the capabilities of API Management and Graph.

Course contents

I like, i wish:, final exam:, enroll me for this course.

This course was rated with 4.42 stars in average from 1029 votes .

Certificate Requirements

• Gain a Record of Achievement by earning at least 50% of the maximum number of points from all graded assignments.
• Gain a Confirmation of Participation by completing at least 50% of the course material.

Find out more in the certificate guidelines .

This course is offered by

Shilpa Vij is a product manager for SAP Integration Suite. Her main focus is on product and customer success. Together with customers and integration experts, Shilpa works globally across industries on product planning and execution throughout the product lifecycle, including gathering and prioritizing product and customer requirements and defining the product vision. She has over 15 years of experience in the integration domain and has co-authored 2 books.

Within SAP, Shilpa works closely with engineering, sales, marketing, and support to ensure revenue growth and customer satisfaction. She provides enablement sessions and expert-level workshops in the various areas of SAP Integration Suite.

Follow Shilpa on SAP Community | Twitter | Linkedin

Piyush Gakhar

Piyush Gakhar is global vice president and head of Product and Strategy for Integration Platform at SAP.

He has over 17 years of experience in the software industry and holds a master’s degree in computer science. Piyush has actively participated in writing white papers, been a key speaker at numerous events, and co-authored a well-received book on SAP Integration Suite. Throughout his career, he has excelled in various roles, including consulting, business development, solution architecture, and product management.

Piyush leads a global team of cross-functional product managers, collaborating closely with customers, partners, and analysts to shape the product strategy and roadmap. He is responsible for driving the success of SAP's integration platform, ensuring both product excellence and business growth.

Follow Piyush on SAP Community | LinkedIn

Udo Paltzer

Udo Paltzer is a lead product manager for SAP Integration Suite, focusing on the integration of APIs, events, and business processes, including A2A, B2B, and B2G integrations. Udo has over 20 years of experience in the integration domain.

As a lead product manager, Udo concentrates on the customer, partner, and product success of SAP Integration Suite, with the goal to help customers and partners in their digital transformation journey. Additionally, he engages with analysts, collects and prioritizes requirements to shape the roadmap of SAP Integration Suite, and is a regular speaker at events as well as customer and partner workshops.

Follow Udo on SAP Community | Linkedin

Sunny Kapoor

Sunny Kapoor is a lead product manager for the cloud integration capability of SAP Integration Suite, focusing on enterprise-wide business process integration and digital transformation.

He is based out of Bangalore, India and has over 13 years of experience and expertise in business process integration and application development. Sunny has held various roles, transitioning from a developer to a product manager.

He is a technology enthusiast who loves to learn and apply.

Follow Sunny on SAP Community | Linkedin

Vinayak Adkoli

Vinayak Adkoli is a lead product manager in SAP Integration Suite, where his main focus is on API Management topics. He is based out of the Bay Area, NA.

Vinayak has over 18 years of experience in a diverse portfolio of integration technologies, covering SAP and enterprises like Microsoft, Google, and IBM.

He champions the cause for customers to adopt a cloud-native and API-first mindset to achieve their digital transformation goals.

Follow Vinayak on SAP Community | Linkedin

Karsten Strothmann

Karsten Strothmann is a lead product manager and evangelist for SAP Event Mesh and SAP Integration Suite, advanced event mesh at SAP SE in Walldorf, Germany.

He has almost 25 years of experience in the software industry and holds a master’s degree in computer science from TU Dortmund University, Germany. He has also co-authored several books, including one on event-driven architecture.

Karsten currently works on event-driven architecture in and beyond the SAP ecosystem. During his career, he has taken on very varied roles, from product management to development, quality assurance, and consulting. This has given him a holistic view of both software creation and its usage. 

Follow Karsten on SAP Community | Linkedin

Marco Ertel

Marco Ertel is a product manager for SAP Integration Suite, focusing on Cloud Integration, Integration Advisor, SAP API Management, and the cloud connector. He has more than 20 years of experience in different areas of SAP.

As a product manager, Marco is a regular speaker at events as well as holding workshops and supporting hackathons.

Follow Marco on SAP Community

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• Response and Supply Planning

Response and supply planning

Generate feasible supply plans to meet demand with accurate inventory targets and efficient capacity use., empower planners with multilevel supply planning.

Create an effective supply plan for your entire network by modeling across locations and multilevel bills of material. Multilevel supply planning gives planners the flexibility to decide what to include in the model or what to constrain the supply plan against. 

Planners can use three algorithm options: unconstrained heuristic, prioritization, or optimization. Prioritization and optimization enable the system to perform a feasible and constrained supply plan in just one step while considering all modeled constraints.

Mitigate risk with tactical rough-cut planning

Develop an effective mid-to-long-range plan that works for your business. Tactical rough-cut planning balances demand and supply while also considering material constraints.

The horizon for rough-cut planning is flexible and you can easily adjust it based on your business requirements. Planners can model and constrain against production, transportation, and storage resources. They can also create simulations and scenarios to try various plan options and then compare them with the embedded Microsoft Excel capabilities of SAP IBP for Supply Chain as well as Web-based dashboards.

Boost agility with operational response management

Overcome the challenges of material scarcity with an operational supply plan that spans the entire network. With this feature, you can create allocations when materials are scarce and reconfirm sales orders to determine a realistic availability date with the supply run.

Create an internal deployment plan based on planner-controlled available-to-deploy quantities to achieve priorities or optimization. Operational response management lets you review gating factors, which provide root cause analysis for delays and shortages. Then, you can use Web-based interactive planning to adjust your plan.

Create consistency with synchronized planning

Bring your operational supply plan together with production planning and detailed scheduling. After you calculate the source destination and order quantities for planned orders, you can use the handover process to convert them into scheduling orders that SAP S/4HANA can sequence. Synchronized planning keeps subsequent planning in SAP S/4HANA in sync with SAP IBP for Supply Chain through a standard, roundtrip integration cycle.

• Request a demo

Explore all capabilities of integrated business planning

Sales and operations planning.

Unify financial and operational stakeholders in one S&OP process to foster collaboration –aligning inventory, service levels, and profitability.

• Explore sales & operations planning feature

Forecasting and demand management

Automate the statistical forecasting process and apply machine learning algorithms to predict demand.

• Explore forecasting and demand management feature

Inventory planning and optimization

Establish optimal inventory targets that enable you to maximize profits, while ensuring customer service levels.

• Explore inventory planning and optimization feature

Demand-driven replenishment

Use strategic decoupling points and inventory buffers to control the flow of material through the supply chain.

• Explore demand-driven replenishment feature

Supply chain visibility

Gain end-to-end visibility of your supply chain and detect potential disruptions with SAP Supply Chain Control Tower.

• Explore supply chain visibility feature

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Dynamics 365 Field Service

Introducing new microsoft copilot capabilities to optimize dynamics 365 field service operations  .

• By Hector Garcia Tellado, General Manager, Frontline Applications, Microsoft Business Applications
• Dynamics 365 Business Central
• Dynamics 365 Finance
• Dynamics 365 Remote Assist
• Content type

Delivering exceptional service is key for building customer preference and loyalty. Today, we’re introducing new capabilities for Microsoft Copilot in Dynamics 365 Field Service that help service managers and technicians efficiently find the information they need to resolve issues right the first time while keeping customers updated at every step of the process. Additionally, with the introduction of Microsoft Dynamics 365 Remote Assist capabilities within Microsoft Teams and seamless data flow across Dynamics 365 Field Service, finance, and operations applications as well as Microsoft 365, we’re helping break down application silos and making it easier to stay in the flow.

Streamlining work order management with next-generation AI

With new capabilities generally available starting today, field service managers can interact with Copilot to find pertinent information about work orders using natural language in the Dynamics 365 Field Service web app. Copilot can assist in retrieving work order details, summarizing them, and presenting them in an easily digestible format. Copilot can also go beyond searching work orders to searching other Microsoft Dataverse records, including accounts, contacts, opportunities, and more. In addition, organizations can now configure the data that Copilot uses to generate work order summaries in Dynamics 365 Field Service to meet their specific business needs.

“The introduction of Copilot in Dynamics 365 Field Service, with its powerful summarization capabilities, is a game-changer. Not only does it benefit our leaders, but it also streamlines internal communications, aids finance, and helps customers stay up to date. By automating this process, we reduce manual work and ensure critical information isn’t overlooked.” Amit Nene, Business Applications Director, BW Packaging Platform, Barry Wehmiller

With new capabilities generally available starting today in the Dynamics 365 Field Service Outlook add-in , field service managers can go beyond asking Copilot for help creating work orders based on customer emails and scheduling them. They can now also ask Copilot to draft email updates to customers recapping details of scheduled work orders or suggesting next steps for unscheduled work orders.

Boosting technician efficiency with new tools in Teams

With the Dynamics 365 Field Service plugin for Microsoft Copilot now generally available, field service managers and technicians can use natural language chat in the flow of work in Teams to find key information about their work orders and other Dataverse records. Starting today, technicians can also use this experience to ask Copilot to search through lengthy product manuals and find relevant answers to resolve product issues faster.

Should technicians need additional assistance from remote experts to resolve issues, starting today they can access Dynamics 365 Remote Assist capabilities in the flow of work in Teams. As a technician shares what they see through their mobile device’s camera during a video call, the mixed reality tools enable technicians and remote experts to use annotations and arrows to refer to specific parts of a machine. These spatial annotations stay anchored even if the camera moves. Access to Dynamics 365 Remote Assist is available at no additional cost with Dynamics 365 Field Service , and licensed customers can try out Remote Assist’s spatial annotation capabilities available in preview starting today within their Teams mobile app for iOS.

To further streamline collaboration among field service managers, technicians, and remote experts in Teams chats, meetings, or channels, Dynamics 365 Field Service users who have installed the Field Service app in Teams can now share links to work orders that automatically expand to provide key details. This link unfurling capability is generally available starting today.

Introducing efficiencies with more integrated offerings

To help the frontline and back office stay in sync as service deliveries impact financial and inventory systems, the Dynamics 365 Field Service integration with Dynamics 365 finance and operations applications is now generally available. Additionally, for small businesses, seamless financial and inventory data flow between Dynamics 365 Field Service and Microsoft Dynamics 365 Business Central is also now generally available.

Learn more at Hannover Messe 2024

Next week at Hannover Messe 2024 , the world’s leading industrial trade fair, organizations across engineering, digital technologies, energy, and more will gather to demonstrate solutions for high performance, sustainable industries. The Microsoft Dynamics 365 Field Service team is honored to attend to showcase how the innovations announced today can help manufacturers. Visit us at the Hannover Messe expo , Hall 17, Stand G06 to discover new ways to transform your service operations with generative AI and mixed reality.

New capabilities generally available today.

Related posts

Enabling fast, flexible, cost-effective service with Microsoft Copilot in Dynamics 365 Field Service  

Microsoft unveils AI features for manufacturers at Hannover Messe 2024  

2024 release wave 1 kicks off with hundreds of AI-powered capabilities for Microsoft Dynamics 365 and Microsoft Power Platform  

Explore the next wave of AI innovation at the Microsoft Business Applications Launch Event  

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Understanding the Capabilities and Limitations of the Controls and Operations of High Voltage Direct Current (HVdc) Converters in Interconnected Electric Power Systems

Published: May 3, 2024

Research topics

The NDS sets out the Government’s approach to address Australia’s most significant strategic risks based on the concept of National Defence.

The adoption of National Defence will see a Strategy of Denial become the cornerstone of Defence planning and means the Australian Defence Force (ADF) will transition to an integrated, focused force.

The IIP sets out the specific defence capabilities the Government will invest in to give effect to the NDS. It provides a generational uplift in Defence’s capabilities and reflects a coherent, logical and affordable plan to transition the ADF to an integrated, focused force.

Together, the NDS and IIP provide a blueprint to deliver an ambitious transformation of the ADF to ensure it is positioned to safeguard Australia’s security and contribute to regional peace and prosperity for decades to come.

2024 National Defence Strategy

2024 integrated investment program.

Solving your most complex planning challenges

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Pharma demands precision. Stop guessing. Start planning strategically.

From ground-breaking innovation to better patient outcomes and every stage in between..

Integrated Business Planning (IBP) connects your supply chain, operational and financial plans to enable faster decision-making and new opportunities for growth. But most importantly, it gets your products in the hands of the people who need them most.

Align decision-making to value with IBP

Ibp for pharma creates a single source of truth throughout your planning processes so you can capitalize on innovation activities, enhance profitability, and accelerate product speed to market..

Transform R&D investments into revenue streams

Model the P&L impact of pricing decisions, improve demand planning accuracy, and optimize your R&D portfolio to forecast future supply and demand. Turn insights into innovation and create new revenue opportunities.

Face unpredictable supply chain volatility head-on

Connect critical information across your supply chain to generate demand volume forecasts, identify potential cost savings (freight, warehouse, holding costs, write-offs, etc.) and uncover new avenues for revenue generation.

Make your working capital work for you

Get the visibility you need with dynamic inventory optimization. Model scenarios to reduce excess costs and waste while confidently freeing up working capital to focus on innovation and efforts that drive growth.

“We have much better visibility into product performance and overall business efficiency with Anaplan.”

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Market experts weigh in on why an integrated approach to business planning is a strategic imperative for pharmaceutical leaders..

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Why do leading pharmaceutical manufacturers plan with anaplan, learn from the challenges and achievements of innovative companies leading the way with an integrated approach to business planning., customer story.

"With Anaplan we have the flexibility to build something that reflects our business to a T."

Senior Director, Corporate Strategy & Finance, Penumbra

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Creating impact and value with integrated business planning.

Download the report to read how Integrated Business Planning (IBP) connects systems, data, and planning across business functions in a collaborative environment that helps make better, faster decisions possible.

Integrated Business Planning for pharma: From concept to adoption—and value

Download the report to read how top pharmaceutical manufacturers are using IBP to improve collaboration and optimize their operational and financial planning strategy.

From breakthroughs to profit margins: How IBP is transforming pharma

Realize faster decision making in pharmaceutical planning, increased efficiency, and a robust supply chain through connected planning to your IBP.

Driving efficiency across the organization with Bayer

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RICHARD WORTHINGTON: Proper integrated energy planning for SA is now urgent

The announced merger of three state-owned enterprises (SOEs) in our oil and gas sector to create a new investment vehicle for “domestic” gas and oil (or derivatives) production, adds renewed urgency to calls to undertake integrated energy planning, as described in the 1998 Energy Policy and legally required in terms of the 2008 Energy Act (Clause 6, which came into effect this month).

The most immediate concerns regarding the “new” SOE (comprising the Central Energy Fund, Strategic Fuel Fund and PetroSA) include how existing debt may be offloaded, and the nature of the financing arrangements already lined up, including with Russia’s Gazprom. However, the bigger picture is the proposition to extend and expand our economic dependence on fossil fuels long term, in the absence of an overall plan for our energy system.

The rationale for integrated energy planning, embraced by the government in 1998, is to give effect to democratic governance of the energy sector, including long-term investment strategy and short-term system development informed by an holistic understanding of all our energy needs, the options available to meet these needs, and the merits of these options from a whole-of-society perspective. Objectives include achieving universal access to modern energy services.

Declining to implement integrated energy planning is a betrayal of a commitment to democratic governance that is potentially more ruinous than governance failures regarding individual SOEs. Compiling a set of supply-side strategies for the various energy resources and carriers on which our economy depends (led by short-term investment prospects) is the antithesis of integrated planning, though even this has not been accomplished.

To realise its potential, integrated energy planning should be approached as a process of social compacting: a participatory engagement that helps all stakeholder understand the energy system we have, the strategic decisions and options available, and to collectively deliberate on where priorities converge and how contending interests might be reconciled, and how compromises should be mediated. This potential has long been articulated in international literature, as well as local civil society advocacy.

The objective of integrated energy planning is not simply to produce credible plans derived from technocratic analysis though the science-based foundations available through modelling and scenarios development provide powerful tools and perspective and as such their assumptions and use must be transparent to all. Seeking common ground among social partners on key inputs to analysis at the outset will support more meaningful and productive engagement on the outputs.

The energy investments pushed by Mantashe clearly conflict with the clear and science-based recommendations of the Presidential Climate Commission early last year.

The most recent attempt to develop an integrated energy plan, not to be confused with the electricity supply plan known as the Integrated Resource Plan (IRP) saw the then department of energy publish an IRP 2016 as a draft for public consultation, with provincial workshops. The comments closed on March 31 2017 and nothing further has been seen of the document or process.

Launching IEP 2016, then-minister Tina Joemat-Pettersson stated: “The purpose of the integrated energy plan is to provide a road map of the future energy landscape for SA ... the integrated energy plan is a continuous process and takes into account the changes in the macroeconomic environment, developments in new technologies and changes in national priorities and imperatives, among other factors.”

The “continuous process” and related capacity-building, research and analysis appears to have gone into abeyance when the department of energy was transferred to Gwede Mantashe’s ministry, to be integrated with the department of mineral resources. This may explain why modelling of electricity generation for a draft IRP published this year was done by Eskom and is not clearly explained by officials, as well as the lack of recent official energy data.

The combined department of mineral resources & energy’s IRP 2023 (public comment closed last month) seeks to pre-empt an holistic and participatory integrated energy planning process for the energy sector, a role that should expand rapidly to support sustainable development. It seeks binding decisions to rapidly establish a large natural gas sector with electricity generation as the anchor (using imported gas for at least the short term), to extend the life of various coal-fired power plants (costs yet to be quantified) and commit to a large new nuclear procurement.

In parallel, the government is subsidising rehabilitation and growth in the oil industry and the department is seeking to bed down long-term investments in SOEs that evade democratic governance, with the only semblance of “public ownership” being through pension funds and debt. Whether complacent or horrified at the climate implications of such fossil-heavy commitments, the shifting global energy and investment landscape make them increasingly high risk, not just for investors but also in terms of their eventually delivering energy as envisaged.

The energy investments pushed by Mantashe clearly conflict with the clear and science-based recommendations of the Presidential Climate Commission early last year, aligned with the Framework for a Just Transition previously approved by cabinet. The commission has noted that the IRP does not address the millions of households trapped in energy poverty, while the inadequate provision for free basic electricity is failing, with less than a quarter reaching intended beneficiaries.

Realising the opportunities for directly reducing dire poverty and inequality through the provision of basic energy services will be a core focus for an integrated energy plan process that explores energy development pathways most compatible with a good life for all, by about mid-century. The Southern African Faith Communities Environmental Institute is calling on the government to initiate a proper integrated energy plan without further delay.

• Worthington is a freelance associate of SAFCEI.

ALEXANDER PARKER: The futility of the upstream petroleum resources bill

Tillmann galler: the clean tech transition will trigger a new commodities supercycle.

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