1. How has social media made the S&OP process more complex?
2. How can e-commerce help and hurt the coordination of sales and operations planning forecasts?

3. Why is the challenge of managing customer relations a critical issue to integrate into the S&OP process?

In autumn 2013, Sony Corporation (Tokyo, Japan) launched the longanticipated successor to its PlayStation family of game consoles. Since its release in 2006, gamers made the PlayStation 3 one of the most successful and longest-lived game consoles in history. The PS4 was announced in February and formally introduced in mid-November. If initial demand was any indicator of success, the PS4 appeared to be an instant hit: more than one million of the units were purchased in the first 24 hours of its release in the United States and Canada.

The release did not go off without a hitch, however. “A noteworthy portion of the customer reviews for the console on Amazon were negative,” Nick Wingfield pointed out in the New York Times. “As of Sunday afternoon, one version of the PS4 had just over 1,800 reviews on Amazon, and about 500 of the reviewers gave a 1-star rating, the lowest possible on Amazon. Many of those people wrote that their consoles stopped functioning after a short period of playing or didn’t work at all.” Some users reported problems with the PlayStation Network, several users had broken HDMI cords, others had problems ejecting disks, and still others saw the “ominous Red Line of Death”—a system error indicator of a terminally damaged machine. Sony maintained that these problems occurred in just 0.4% of the total shipped PlayStation 4 units; in other words, though the negative publicity was loud, a minority of users had problems with the new system.

The reaction of this vocal minority of disgruntled users of the PlayStation 4 illustrates the importance of not only staying out ahead of demand expectations through careful operations planning and supply chain management, but also managing customer reactions to the system. Dissatisfied customers will share their grievances on social media to make their concerns known and known right away. Sony’s response was to stay on top of this situation through those same social media channels to which complainers flock. A page on its own community pages, for example, directly addressed the “blinking blue light” system error message that so many users complained about, offering symptoms, possible causes, and solutions. In short, managing the supply chain for sales and operations planning now also includes the need to carefully monitor and manage the customer interaction and online communication.

What does Sony anticipate for the PlayStation 4’s down the road? The company expects to sell 20 million PS4 consoles by 2017. Although overall sales of videogame systems have been in a continuous slump since 2008, as a result of competition from games offered on mobile devices and social networking sites, game console manufacturers, including Sony and Microsoft Corporation (Redmond, WA), are experiencing robust sales of their latest offerings (the PS4 and Xbox One respectively), suggesting that, after nearly a decade of playing games on the same old consoles, there is pent-up demand for these new systems, provided Sony and Microsoft continue to do a careful job of planning to support the successful launch of their next generation game systems.