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CIO Roundtable: A Direct Line to Results: How CIOs Can Get Demand Planning Right

How accurate are your predictions for future demand?

The pandemic has created supply chain issues that are still ongoing. As a result, demand planning has become a key competency for durable goods manufacturing CIOs. They need to ensure that technology, data, communications, and information systems are aligned to support these capabilities.

High-quality forecasting of demand, as part of a holistic demand strategy, allows you to optimize production, inventory, and distribution, which reduces cost, improves efficiency, and increases customer satisfaction.

Improving demand planning is critical now

  • Demand planning and demand-driven material requirements planning are critical to meet customer demands for on-time-in-full delivery of product and solutions.
  • This planning method uses current, historical, or future forecast information and incorporates inventory movement elements such as safety stock, buffers, seasonality, distribution fluctuations, inventory locations, customer locations, and market shifts for optimal global planning.
  • By having a deeper, more accurate understanding of customer demand, CIOs can help companies identify new business opportunities that drive growth. 

Take the guesswork out of demand planning

Join this roundtable to get the latest insights in demand planning:

  • Learn how your peers are advancing demand planning and forecasting techniques and processes
  • Increase your understanding of demand planning and forecasting drivers, toolsets, and technologies for success
  • Learn how CIOs and IT leaders are addressing the new norms of supply chain and market volatility and uncertainty

Demand planning systems ownership obstacles and keys to success

Situation: Foundation for success

Demand planning and supply chain planning analytics drive the market growth of digital tools for supply chain management.

In Retail and Wholesale specifically, demand planning is one of the most crucial processes in setting the business up for success. It has close ties with other planning and forecasting activities as well as vendor management.

Complication: Confusion in terms and processes

Demand planning as a term and process can be confusing since much of the actual planning is embedded in other processes such as sales and operations planning (S&OP).

Demand planning software is expensive, and its implementation often fails to meet organizational goals because of confusion and immaturity surrounding the organizational planning process overall.

Those failures can put a lot of pressure on IT to resolve the issues.

Solution: Increase confidence

IT leaders can increase their confidence around demand planning technologies to better support the business.

  • Learn about what demand planning is, the state of the market, key features and functions, and leading vendors in the space.
  • Gauge the current state of demand planning capability in your organization and opportunities for development.
  • Devise a list of initiatives you can integrate into your IT strategic plan to transform demand planning in your organization.

Unpredictable consumer demand is the supply chain’s biggest hurdle

In a post-COVID-19 world, the traditional just-in-time inventory model will become more complicated due to unstable demand. Too much inventory sitting in warehouses or, conversely, inventory shortfalls can completely sink profitability.

"Unpredictability in Consumer Demand is one of the biggest drivers of Supply Chain uncertainty in the post-COVID-19 world." Gary Newbury, Retail Supply Chain Specialist, as interviewed by Argentus

What is a demand planning system?

Demand planning systems facilitate the process of forecasting product demand

The goal is to manage product inventory and availability better to satisfy customers and optimize operations.

A demand planning system is concerned with the following analyses and aspects of the forecasting process:

  • Market analyses
  • Historical data on sales
  • Competition influence analyses
  • Economic conditions analyses
  • Planning horizons
  • Plan collaboration and feedback
  • Forecast modeling

Demand planning is an essential component of overall supply chain planning. In Wholesale in particular, it is one of the most crucial processes in setting up the business for success. It has close ties with other planning and forecasting activities, as well as vendor management, so the respective systems will either have those activities defined or appeal to the input/output of them in some way.

Supply chain planning vs. demand planning

Demand Planning

Using forecasts and experience to estimate demand for various items at various points in the supply chain. Relies more heavily on economic conditions and consumer confidence in the market. Demand predicting concerns itself with consumer interest.

Examples of Features & Processes

  • Market analyses
  • Competition influence analyses
  • Economic conditions analyses
  • Planning horizons

Activities Management

Tapping into and responding to business strategic and tactical changes and initiatives affecting the product or service offering and hence supply chain planning.

Examples of Features & Processes

  • SKU rationalization
  • Mergers and acquisitions
  • Product lifecycle management
  • Promotions
  • New markets entering

Sales Forecast

Sales prediction focused on a detailed product forecast to provide a business with a concrete financial figure concerning anticipated product revenue. Predicting product sales usually involves more mathematical calculations than gauging product demand.

Examples of Features & Processes

  • Statistical forecasting
  • Sharing operations schedules with trading partners
  • Budgeting
  • Revenue and profit forecasting

S&OP

Sales and operations planning is a process that integrates demand, supply, and financial planning into one plan for business. It links strategic plans with operational plans to produce a product portfolio that maximizes revenue and profit.

Examples of Features & Processes

  • Production plans and schedules
  • Operational feedback
  • Forecast adjustments
  • Collaboration

“Demand planning” can be a confusing term, as much of the actual planning process occurs during other processes, such as S&OP. Demand planning is very much about determining what the actual demand is now and what it is likely to be in the future.

Featured Speakers

Christopher Goodhue

Managing Partner
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Shreyas Shukla

Principal Research Director
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