Optimization is defined as making the “best” of anything. The true meaning is in defining what is the “best.” In the case of inventory, in my opinion, it’s the balance between the improvements in return on assets (ROA) and the loss in sales and customer good will. That careful balance needs to be constantly evaluated in an analytical fashion from one operating period to another. View Article…
There are 2 and ½ good reasons to gain input from sales people during the forecasting process. First is to provide feedback on the financial budget vs. expected actual. And second, but most importantly to the demand planning people, is to collaborate on the final forecast for downstream planning. Of course, sales forecast vs. actual performance is a clear means for personnel performance evaluation of sales people. View Article…
Embarking on a demand forecasting project is usually a somewhat frightening challenge especially if you were the one pushing for the change. The cost justification for the project may have been aggressive and the expectations may have been set a bit high to get the project launched – it’s all part of the game sometimes. But if you didn’t do so during the justification phase, here’s a high-level checklist that can help ensure the success of your demand forecasting initiative while putting your career as a demand planner in the driver’s seat ― not under the wheel! View Article…
Putting a new forecasting system in place usually meets with a good deal of resistance for a variety of reasons – some good and some are just smoke screens to avoid accountability. Let’s look at the good, the bad and the ugly to try to uncover the real truth.
Big data and corporate data warehouses have been expanding exponentially with information that’s not exactly a benefit to the operations and supply chain community. Supply chain management requires highly specialized integrated data not found in corporate data warehouses to support a fast-moving global supply network and a more demanding customer base. This data needs to be gathered from new sources, transformed and enriched to be useful to supply chain professionals. But unfortunately, that comes with challenges like these: View Article…
The financial health of an enterprise today is directly dependent upon the health of their supply chain. With that exposure, it is only prudent to employ a risk management strategy to the supply chain. Sales and Operations Planning is a “must” for progressive enterprises, but its job is to react to changes and retarget to meet customer demand within a constrained supply base ― not to assess risk. View Article…
Inventory is one of the largest assets on the balance sheet of most manufacturing and distribution companies ― understandably making it a favorite cost reduction target by financial executives. My perception is that too often the effort is placed on reducing inventory levels without a good, manageable plan. View Article…
There is an increasing emphasis on leveraging operational analytics throughout the enterprise, but some businesses can end up less than happy with this strategic investment if they don’t approach it properly. Supply chain professionals can easily avoid some common errors as they implement the business intelligence (BI) solutions that provide those analytics.
Whether it is an entire suite of analytic applications, an inventory management solution or customer relationship management (CRM) analytics, here are five steps that every enterprise should take as it brings new operational analytics solutions online: View Article…
In Part 1 of “Setting Sail with Sales & Operations Planning” I discussed the wide variety of reasons companies move toward a more formalized S&OP process, the inputs required to sustain the plan, and the supporting technologies to make it all work. This second post will discuss the metrics that can be used to target different types of improvements in the enterprise and finally some of the headwinds to realizing the value from a technology-driven S&OP process. View Article…
A number of business challenges are driving more and more companies to formally embrace Sales and Operations Planning (S&OP). While the benefits are usually obvious, the challenges of implementing a formalized S&OP process are sometimes hidden and can be enough to sabotage a project if discovered after the process has begun.
In this two-part series, we will look at the various elements of the S&OP process and the considerations that should be taken into account while designing the process. This post will review the front end of the process and what drives it, along with the technologies needed to support and sustain the S&OP process. View Article…
