Integrated Business Planning - IBP Maturity

This is blog 8 in a series of 9 on the topic Integrated Business Planning (IBP). In these blogs we will detail our IBP Framework, the importance of a proper IBP implementation and the benefits it can bring organisations. Topic of this blog: IBP Maturity.

IBP maturity comes in five stages:

• Reactive
• Tactical
• Balanced
• Collaborative
• Integrated

Each level is a next step upwards to full maturity. We did not invent this maturity model, organisations as Gartner and McKinsey have paved the way for us. The way we use it for our customers is to create a starting point, to take stock of the current level. Where is your organisation situated right now? And which leve do you want to achieve?

Level of Maturity

Looking at the picture, it seems we will define one level for all processes within an organisation. That we will define an overall picture of maturity. But we see different processes can have different levels of maturity in an organisation. So instead of one overall measure, we define the maturity level for different processes:

• People: culture & behaviour, people
• Process: deliverables. process, horizon, planning
• Tools: technology
• Analytics: measures & CSF’s, performance

Each process can have a different level of maturity and for each process a different target level of maturity can be established.

Taking Inventory

To achieve the target level of maturity, you need to know the current level. So we always start with an analysis of the current level across the different processes. We have tools that support in establishing a view of the current levels (workshops, interviews, questionnaires, etc.). Once the outcomes are available, we will present this in an overview that is understandable for the organisation. We see that this overview of the current level of maturity triggers discussion. People expect to see higher levels of maturity (in most cases) and is always a great starting point for the next step, the target level of maturity.

Target level of Maturity

For the target level, we always try to keep the expectations realistic. Most organisations want to achieve the highest level of maturity (Integrated), for all processes. But in most cases that comes with an effort that might be too much. For some processes, this highest level might be achievable and should be set as the target goal. For other processes, the level Collaborative is already a huge step forward and the target to achieve.

Planning

Once the current and the target levels across the different processes are known, we can start to define the actions needed over time to achieve the target levels. For one process it might be achievable within a few months, for others it might take years. Especially if you want to increase more than one level of maturity.

The actions can be planned and measured. Besides the planning to keep track of progress, also measures should be put in place to ensure the expected quality is achieved.

Improvements

During the implementation of the required actions, the organisation should see the improvements in day to day activities. Departments start to collaborate more, the forecast accuracy starts to improve, the number of daily operational issues slowly starts to decline, customer satisfaction starts to increase, revenue increases as well as margin.

The IBP maturity improvement is a timely and tedious road to travel, but the benefits that lay at the horizon are huge. Besides the increased maturity of your own organisation, we do see a spin off to your supplying organisations as well. If they see the benefit of the road you are travelling, they might be interested to improve as well. As several organisations start to improve, the full supply chain will benefit.

Conclusion

IBP maturity is not established overnight. It takes effort and might take several years to reach the target levels. But each increase of maturity brings benefit for your organisation. The target level of maturity can be set different at different levels across the mentioned processes within your organisation, depending on the ambition of the organisation as well as the level of maturity of your supply chain in general. But the benefits will be huge. IBP maturity plays an important role in the success of Integrated Business Planning. Without the proper maturity level, too many errors are made, misalignments across departments and a lower forecast accuracy (to name a few).

The next blog will be the last one in this series of nine: IBP Roadmap – closure. In this last blog we will look at at the previous eight blogs, add our recommendations and come to a final conclusion.