What are the three main components of master planning?

The three main components of master planning are demand management, supply planning, and sales and operations planning.

Demand management involves understanding and influencing customer demand to create a balanced forecast that aligns with business capabilities. This process ensures that the organization can adequately respond to market needs while maintaining efficiency in production and inventory levels.

Supply planning focuses on determining how to meet the demand forecasts. This includes managing procurement, inventory, and production resources to ensure that products are available when needed. It involves analyzing capacity constraints and optimizing resources to fulfill the demand efficiently.

Sales and operations planning serves as the bridge between demand and supply planning. It aligns the operational capability with market demand to prioritize and synchronize efforts across the enterprise. This integrated approach helps in making informed decisions that enhance customer satisfaction and operational performance.

By combining these components, master planning creates a cohesive strategy that helps organizations respond effectively to market conditions and customer needs, while optimizing their resources and maintaining profitability.