Traditional IBP is dead. Long live Intelligent IBP!

The evolution of Integrated Business Planning has been at a standstill for years. Traditional IBP process and planning horizon thinking, supported by traditional Advanced Planning and Business Intelligence (BI) systems, limits progress.

Sure, over the years new supporting planning features have been developed. Faster calculations, a nicer GUI, more simulation capability, Machine Learning and graph databases, to name a few. But both the IBP process and the supporting planning systems are over 20-year-old concepts.

Thought leaders and consultancies, most of them locked in the same traditional IBP narrative, have not provided new ways forward for years. IBP conferences are mostly a repeat from the year before. IBP webinars discuss the same over and over again.

Ttraditional IBP is not set up for a fast-changing world, where speed of decision making confers a competitive advantage. After all, IBP has always been proposed as a decision-making forum by its early pioneers. Progress in advanced analytics and BI, have provided us with better insights, and nicer graphs, not so much with more integrated, accurate or faster decisions.

In an October 2021 Foresight 2021 article, my colleague Hein Regeer and I, have published a new narrative for IBP, where we suggest a new way forward. We believe IBP can be converted from a separate, sequential, monthly planning cycle to an integrated component of day-to-day business.

Yes, you can keep your monthly IBP process and meeting schedule if you want to. After all, it is great for humans to be in contact. But you also have to start building an operating model where you can make any required IBP decision at any time.

We propose a deep collaboration between human and machine in decision making. As BI is now advancing to DI – Decision Intelligence, we can develop a new operating model based on decisions. An operating model where many S&OE and operational planning decisions are automated, where the human is assisted by the machine for high value planning decisions and where strategic and cultural decision stay human centric.

Intelligent IBP

This will create an Intelligent IBP, centered around decisions, where decisions are being made when required, not when the process dictates. Where decisions are digitized so the enterprise can learn from every decision made. Where an IBP team is incentivized to increase decision value rather than policing IBP process compliance.

We are encouraged by the support of thought leaders, like Supply Chain Professor and author of The Humachine, Nada Sanders, who commented; “You offer an excellent path toward reinvention of traditional IBP that companies should follow.

Or Alain Perrot, a 30-year-old IBP veteran, who foresees a full symbiosis between human and machine across all planning horizons. Who commented; “In 10 years’ time from now, we need to visualize what machines can do.”

In this day and age, it is absolutely absurd to think that critical business decisions will be made every Thursday in week 4, in the 1pm-5pm IBP meeting. The world doesn’t wait for your IBP cycle.

There are hurdles to overcome to create a new decision centered operating model, but a least, let’s start thinking forward. Let’s imagine what an operating model can look like where IBP decisions can be made at any time.

Let’s start visualizing what will be possible. Now and in 10 years!

2 thoughts on “Traditional IBP is dead. Long live Intelligent IBP!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s