Tactical sales and operations planning: A holistic framework and a literature review of decision-making models

Tactical Sales and Operations Planning (S&OP) has emerged as an extension of the aggregate production planning, integrating mid-term decisions from procurement, production, distribution, and sales in a single plan. Despite the growing interest in the subject, past synthesizing research has focused more on the qualitative and procedural aspects of the topic rather than on modeling approaches to the problem. This paper conducts a review of the existing decision-making, i.e., optimization, models supporting S&OP. A holistic framework comprising the decisions involved in this planning activity is presented. The reviewed literature is arranged within the framework and grouped around different streams of literature which have been extending the aggregate production planning. Afterwards, the papers are classified according to the modeling approaches employed by past researchers. Finally, based on the characterization of the level of integration of different business functions provided by existing models, the review demonstrates that there are no synthesizing models characterizing the overall S&OP problem and that, even in the more comprehensive approaches, there is potential to include additional decisions that would be the basis for more sophisticated and proactive S&OP programs. We do expect this paper contributes to set the ground for more oriented and structured research in the field.