# IBP Maturity Model

IBP maturity describes how advanced an organization's planning capability is — from ad-hoc firefighting to a fully integrated, analytics-driven process that shapes strategy 📈. A maturity model provides the framework for honest self-assessment and a realistic improvement roadmap.

IBP Maturity Model:
A structured framework for assessing an organization's planning capability across multiple dimensions (process, people, technology, data, culture) and defining a progression path from reactive operations to strategic planning excellence.

Why does this matter? Because organizations routinely misjudge where they are. A company that holds monthly S&OP meetings may believe it is "integrated" when, in reality, those meetings produce reports but not decisions. The maturity model provides an objective lens to cut through that self-assessment bias.

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# The Five Maturity Stages

# Stage 1: Reactive

There is no formal planning process. Decisions are made ad-hoc in response to immediate crises. Functional silos dominate — sales has its forecast, operations has its production plan, and finance has its budget, none of which reference each other. Inventory is either too much or too little, and nobody agrees on why.

Hallmark behavior: The leadership team spends most of its time fighting fires rather than preventing them.

# Stage 2: Foundational

Basic S&OP meetings exist. Demand and supply plans are created independently and shared in a monthly review, but they are not truly integrated. Data is available but inconsistent across functions. The meetings feel productive, but few binding decisions come out of them.

Hallmark behavior: Monthly meetings happen consistently, but participants often say "we discussed it" rather than "we decided."

# Stage 3: Integrated

Cross-functional process is established with a genuine one-number plan. The monthly cadence includes demand review, supply review, financial reconciliation, and an MBR with real decision authority. Basic KPIs are tracked and reviewed. Governance is documented and mostly followed.

Hallmark behavior: When someone asks "what's the plan?" there is one answer, and it was agreed cross-functionally.

# Stage 4: Advanced

Scenario planning is routine — the team evaluates multiple futures rather than betting on a single forecast. Financial integration is deep, with the demand plan directly driving P&L projections. Demand shaping (pricing, promotions, allocation) is used proactively. Rolling forecasts have replaced or supplemented the annual budget as the primary planning instrument.

Hallmark behavior: Leadership asks "what are our options?" rather than "what is the forecast?"

# Stage 5: Leading

Real-time demand sensing feeds the planning process. Predictive analytics and machine learning augment human judgment. IBP is explicitly connected to corporate strategy — portfolio decisions, capacity investments, and market entry/exit are driven through the IBP process rather than parallel to it. Continuous improvement is embedded in the culture.

Hallmark behavior: The IBP process is how the company is managed, not a planning exercise that runs alongside management.

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# Assessment Dimensions

Maturity is not one-dimensional. An organization might have advanced technology but foundational processes, or strong people capabilities with poor data quality. Assessing each dimension independently reveals the real picture.

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# How to Use the Model

# Self-Assessment Exercise

Gather a cross-functional team (demand, supply, finance, commercial, IT) and independently assess each dimension. Compare ratings — the disagreements are often more valuable than the consensus. Where functions see maturity differently, that gap reveals where the process is inconsistent.

Practical approach:

1. Each participant rates the organization (1–5) on each dimension independently
2. Compare ratings in a facilitated session — discuss where scores diverge
3. Agree on a consensus current-state rating for each dimension
4. Identify the two or three dimensions with the largest gap between current state and desired state

# Gap Identification

Maturity is not about being a "5" everywhere. The right target depends on your industry, business complexity, and strategic priorities. A midsized manufacturer with stable demand may find that Stage 3 (Integrated) is the right target for most dimensions, with Stage 4 (Advanced) in a few critical areas.

# Improvement Roadmap

Sequence matters. You cannot build advanced analytics on top of broken process or bad data. A typical progression:

1. Process first — Establish cadence, meeting structure, and governance
2. People second — Build capability, define roles, secure executive sponsorship
3. Data third — Clean and unify the data foundation
4. Technology fourth — Implement tools that support the process (not the other way around)
5. Culture throughout — Culture shifts gradually as the process delivers results and builds credibility

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# Common Maturity Traps

Organizations fall into predictable traps when trying to advance their IBP maturity. Recognizing these patterns early saves time and money.

Skipping stages. An organization at Stage 1 (Reactive) purchases an advanced planning platform and expects to jump to Stage 4 (Advanced). Without foundational process and data discipline, the technology becomes an expensive spreadsheet. Maturity stages exist for a reason — each one builds the foundation for the next.

Over-investing in technology at low maturity. Technology is an accelerant, not a substitute. Buying a best-in-class demand planning tool does not improve forecast accuracy if the organization lacks a consensus process to use the forecast. Process must lead; technology follows.

Declaring maturity based on meetings existing. Having a monthly S&OP meeting does not mean you are at Stage 3. The defining characteristic of Stage 3 is not the meeting — it is the one-number plan, the decision rights, and the accountability that follows. If meetings happen but decisions do not, you are at Stage 2 regardless of how polished the slide deck looks.

Maturity as a destination rather than a direction. The model is a diagnostic tool, not a scorecard. The goal is not to check the "Stage 5" box — it is to understand where investment in improvement will yield the most business value. Some organizations will never need Stage 5 in every dimension, and that is perfectly fine.

Ignoring culture. Process, data, and technology changes can be mandated. Culture cannot. If the organization does not trust the process — if leaders still maintain shadow forecasts or override decisions informally — no amount of structural improvement will stick. Culture is the dimension that makes all the others durable.

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# Further Reading

• Management Business Review — The executive meeting that defines whether your process produces decisions.
• Governance & Decision Rights — The framework that makes IBP decisions stick.
• KPIs & Metrics — How to measure whether your IBP process is delivering value.