FORECASTING & DEMAND PLANNING
Managing Demand Is
No. 1 Priority for
Regardless of Sector
Cynicism does not enable
progress! Why are many companies making strides and others are not in forecast accuracy? Implementing demand
planning methods, technologies and processes that are
appropriate to their business,
their products and their sales
channels might have a bit to
do with it.
—Ann Grackin, chief executive officer
of ChainLink Research
irst, demand management is all about customers: What are their
needs, spoken or latent, and how do we procure or design just
enough to sell to them? Successful planners understand this and
have processes both internal and collaboratively with their
channels and suppliers to gain this data and model it—not relying on history
as the sole source of data. Our research for both 2010 and 2011 business priorities shows that demand management is numero uno for all sorts of organizations in every sector.
Strategies for 2011 include:
• Collaboration: Management across the chain to understand the nuances of
your business partners’ strategies and requirements. What matters to them in
the demand process? They are trying to optimize different issues than your firm
and subsequently their techniques are different and yield different types of
data. That might have profoundly positive or negative impacts on how you see
things. Dialog pays off. Then build the integrated planning process!
• Channel: Channel/sales partners have access to data. Collaboration does
make a difference. Sales channels are a great source of data!
• Complexity: face up to it and tackle it!
• Sales and operations planning: Why is this such a problem? Again, facing
up to the organizational challenges and using imagination can go quite further
here than the technologies, strong or weak, that exist in the market place. But
technology is part of the process.
• Technology solutions: In spite of all the talk, so many firms have not really
started the journey to using advanced technologies to address the nuances of
understanding demand. Great solutions, at all price points, do exist that can
truly make a difference and are designed to specific industries, sectors and
process problems. Doing without is not wise.
2011 will see more purchases of demand-oriented solutions. Forecasting, Merchandizing, Trade Promotion Management, S&OP, and Collaboration, either as
modules or the whole suite, will sell well. Though the supply chain sector grows
at about 7 percent a year, the demand sector holds the most interest to the enterprise. As firms outsource more, they need to be assured that their network of trading partners has the best possible information and forecasts on markets in order to
ensure the whole supply chain performs!