A Practitioner’s Guide to Demand Planning

This is an excerpt of the original article. It was written for the March-April 2013 edition of Supply Chain Management Review. The full article is available to current subscribers.

March-April 2013

Inventory needs to be “optimized” to properly match supply and demand. This has become all the more important as competition intensifies globally and supply chains get longer and longer. Learn from a subject matter expert about the benefits of inventory optimization and how to get an IO initiative on track in your organization

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Within most organizations, the words “demand planning” cause a reaction—and typically not a mild one. It is characterized by emotional extremes like anger, despair, disillusionment, or even hopelessness. Seldom do we find a team excited or optimistic about their chances to improve demand planning processes.

After two decades of process and technology refinement, excellence in demand management still eludes supply chain teams. In fact, it is the supply chain planning application with the greatest gap between performance and satisfaction. At the same time, it’s the application with the greatest planned future spending. For most teams, demand planning is a conundrum, a true love-hate relationship. They want to improve the demand planning process, but remain skeptical that they can ever do so.

In our research at Supply Chain Insights, we find that demand planning is the most misunderstood—and most frustrating—of any supply chain planning application. While companies are the most satisfied with warehouse and transportation management, they are the least satisfied with demand planning.

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