D365 Is Live. Why Is Your Team Still Planning in Spreadsheets? The Operational Risk.
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D365 Is Live. Why Is Your Team Still Planning in Spreadsheets? The Operational Risk.
For operations leaders managing supply chain, production, and planning on Dynamics 365 Finance & Operations.
Spreadsheets are not a problem, but they are a signal the value an organization is benefitting from Dynamics 365 is far short of the potential.
Microsoft Dynamics 365 implementations, and ERP projects, are delivered as MVPs. They establish core functionality, but many capabilities are pushed to post go-live. If you attempt to do too much for your go-live, the project struggles under its own weight, and capabilities must be cut from scope. Either way, some things must wait.
So, you’re operating on Dynamics 365, but many departments continue to use the spreadsheets they have always used.
Why Are Spreadsheets a Problem in D365 Supply Chain Planning?
The problem is not that spreadsheets exist, but the risk is that they remain forever. Spreadsheets have served businesses remarkably well for decades, but if the organization does not sunset their use, they become a performance bottleneck.
There are additional risks that emerge as spreadsheet reliance grows over time:
- Spreadsheets often rely on complex formulas that become increasingly difficult to understand and maintain
- They are not intuitive, creating challenges when ownership transitions or backup resources are required
- Data can be easily corrupted through manual errors, including formula fields being inadvertently deleted or overwritten, leading to incorrect calculations
- There is limited traceability, making it difficult to understand how decisions were made
- They are difficult to adapt quickly during unplanned or emergency situations
These risks compound over time, increasing operational fragility, and reducing the organization’s ability to respond with speed and confidence.
Unlike system driven processes, manual spreadsheets can only operate as fast, accurately, and as frequently as the person doing it. Until the spreadsheets are retired, the expertise remains embedded in the spreadsheet and the planner’s head rather than in Microsoft Dynamics 365. The system does not improve because critical thinking is constantly reapplied in the spreadsheet. As a result, the system will never be trusted, and the business will continue to run on spreadsheets.
Why Does Planning Rely on Spreadsheets?
Most organizations will say planning happens in Dynamics 365. But the truth is, it happens in both Dynamics 365 and Excel. In many environments, Planning Optimization is not fully trusted to drive execution.
Planners export data into spreadsheets and make manual changes to:
- Adjust demand
- Override supply recommendations
- Modify supplier and production lead times
- Account for conditions the system does not know
- Account for conditions the system does not know
The planner is overriding Dynamics 365 and making adjustments in Excel because they believe the inputs to Planning Optimization are incorrect.
The Inputs are the Challenge of Leveraging Planning Optimization
Planning Optimization in Dynamics 365 does not rely on reports or spreadsheets.
It runs on:
- Demand (forecasts and orders)
- Supply (inventory, purchase, production)
- Planning parameters (lead times, safety stock, coverage)
- Planning parameters (lead times, safety stock, coverage)
When these inputs are correct and aligned, the system produces reliable, executable recommendations. When they are not, the system produces an incorrect plan that requires a manual override. This is the root cause of why spreadsheets persist, the system is not trusted to operate independently.
The key to success with Planning Optimization is evaluating and improving the completeness and accuracy of the inputs. Schedule a meeting with Ascent to discuss getting the inputs right.
What does Planning Optimization in Dynamics 365 look like?
D365 Planning Optimization is a supply orchestration engine that converts demand into executable supply decisions across procurement, production, and distribution.
Every time Planning Optimization runs, it evaluates:
- Demand from sales orders, forecasts, and intercompany requirements
- Supply from on-hand inventory, purchase orders, production orders, and transfers
- Policies defined through coverage groups and planning parameters
- Constraints from lead times, bills of material, routes, and resource capacity
- Constraints from lead times, bills of material, routes, and resource capacity
It continuously evaluates changes in demand and supply and generates system-driven recommendations to keep the plan aligned with reality.
The mechanism for operational impact is action messages.
What are Dynamics 365 Planning Optimization Action Messages?
Action messages are system-generated recommendations that tell you how to adjust your plan.
When something changes, a sales order quantity increases, a delivery date shifts, supplier or production timing changes, the system recalculates and makes specific, actionable recommendations.
Planning Optimization can automatically suggest:
- Advance: Move orders earlier to meet demand sooner
- Postpone: Delay orders to avoid excess inventory
- Increase: Add supply to prevent shortages
- Decrease: Reduce supply to avoid overstock
- Decrease: Reduce supply to avoid overstock
These recommendations apply across purchase orders, production orders, and transfer orders, and they propagate across the supply chain. A change at the demand level can trigger coordinated updates across suppliers, production, and distribution.
How Does Dynamics 365 Planning Optimization Make Strong Recommendations?
Planning Optimization operates within established parameters:
- Minimum and maximum order quantities
- Order multiples
- Safety stock requirements
- Supplier calendars and availability
- Production constraints and BOM dependencies
- Production constraints and BOM dependencies
It will not reduce supply below safety stock levels. It will adjust quantities to match supplier order multiples. It will sequence actions across BOM levels to maintain feasibility.
The business rules within Planning Optimization are owned and managed by the planner and can be adjusted as needed.
Why This Matters for AI
When all adjustments and decisions are recorded by Dynamics 365, it captures the conditions that led to a decision point and how the decision played out. Over time, this creates a rich dataset of how the business actually operates under changing conditions.
Managing planning within D365 is what ultimately enables AI to identify patterns, detect emerging risks and opportunities earlier, and recommend better planning decisions over time.
How Can Organizations Sunset Spreadsheets?
Spreadsheets reveal Microsoft D365 and reporting are not trusted, which is where focused projects yield significant business impact.
To determine what to prioritize, organizations can do the following:
- Identify where planning occurs outside D365
- Create an inventory of all the spreadsheets
- Stack rank the business value of systematizing each one
- Score each initiative for low, medium, and hard complexity
- Build a roadmap to retire spreadsheets
- Build a roadmap to retire spreadsheets
Each spreadsheet is not just a workaround. It represents a specific gap in the system that, once addressed, improves both execution and trust.
How Ascent Innovations Can Help
Ascent helps organizations move from spreadsheet driven planning to system driven execution by:
- Identifying gaps in planning inputs
- Translating spreadsheet logic into D365 configuration
- Improving data accuracy and alignment
- Training teams to maintain trust in D365 Demand Planning
- Training teams to maintain trust in D365 Demand Planning
If your planning process still depends on spreadsheets, the path forward is clear. Schedule a session with Ascent to identify the highest-impact opportunities to move planning into Dynamics 365 and improve execution.
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