• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • Login
  • Subscribe
  • Logout
  • My Profile

  • CORONAVIRUS
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • REGIONS
    • Asia Pacific
    • Canada
    • China
    • Europe
    • Latin America
    • Middle East/Africa
    • North America
  • THINK TANK
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » The Challenges of Demand Management

The Challenges of Demand Management

June 21, 2011
SupplyChainBrain

Janice Gullo, lean supply chain master and black belt at the DuPont Center of Competency, shows how Lean concepts can be applied to the demand-forecasting process, to improve accuracy, profitability and customer-service levels.

Gullo is "frustrated" by those who claim that forecast accuracy can't be improved. With so many inputs to consider, the process can be confusing, she acknowledges. But collecting the right day is key.

The DuPont Center has been working to eliminate waste in the forecasting process. The data should be exactly what's needed, and nothing more. Information on discontinued products should be weeded out. Once the data is cleaned up, the company should segment its product base, using an "ABC" approach. Top priority should be assigned to the 20 percent of items that generate 80 percent of revenue. "You take that segment," she says, "and focus all your resources on making it more accurate." Fewer data points to consider means less work, and the greater chance of coming up with accurate numbers. Slower-selling items shouldn't be ignored, but should be managed differently. "You don't necessarily have to forecast them," Gullo says, cautioning against "having a sales person focusing on the minute details of a product that's purchased once a year."

Essentially, says Gullo, the company is applying Lean concepts to the flow of demand data.  In the process, "you're focusing on what matters."

It isn't all about the numbers, however. The assumptions behind the data are equally important. Much depends on whether a particular product can be accurately forecasted, or that the company is aware of the margin of error attached to that item. "The assumption is that history will repeat itself," Gullo says, adding that this isn't always the case. Companies should know which products are subject to high levels of variability, before they commit to new plants or increased orders.

For new products, which have no history of demand, companies should rely on collaborative relationships with customers. In particular, they need to understand buyer demographics. The Collaborative Planning, Forecasting and Replenishment (CPFR) model, created to address demand questions in a variety of retail environments, can help. "It's a beautiful thing," says Gullo. "You can move the push-pull interface to where it matters for that company."

To view video in its entirety, click here

RELATED CONTENT

RELATED VIDEOS

Logistics Outsourcing Technology Forecasting & Demand Planning Sales & Operations Planning Supply Chain Visibility Order Fulfillment
KEYWORDS Forecasting & Demand Planning Logistics Outsourcing order fulfillment Sales & Operations Planning Supply Chain Visibility Technology
  • Related Articles

    The Challenges of Demand Management

    The Challenges of Managing Global S&OP

    Integrated Product Portfolio and Project Management: The Art of New Product Demand Planning

SupplyChainBrain

100 Great Supply Chain Partners Issue 2009

More from this author

Wake up to Coronavirus Updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • Coronavirus-watch-Armada

    Virus Update: Pfizer Plant Cited for Quality Issues; Vaccine Maker Warns of Raw Materials Shortage

    Coronavirus
  • Walmart

    Walmart Embraces a Local Fulfillment Model for Grocery

    Logistics
  • Shipping Logjam

    U.S. Retailers See Millions in Sales Delays Amid Shipping Logjam

    Coronavirus
  • How Can E-Commerce Retailers Compete?

    Smaller E-Tailers Weigh Pros and Cons of Fulfillment by Amazon

    Logistics
  • Amazon

    Podcast | Making It As an Amazon Seller: It’s No Picnic

    Logistics

Digital Edition

Scb feb 2021 lg

2021 Supply Chain Management Resource Guide

VIEW THE LATEST ISSUE

Case Studies

  • Remote Implementation: A Dose of the Right Medicine for B2B Pharmacy

  • LSP Saves Customer $1.5 Million a Year With MPO Global Inbound Management

  • Auto Supplier Wows Key Client Using riskmethods Supply Chain Savvy

  • Integrating Shipping and Compliance Saves Conglomerate Millions

  • How a Consumer Goods Giant Upped Its On-Time Delivery Performance

Visit Our Sponsors

6 River Systems ArcBest Armada
aThingz BluJay Burris Logistics
DSC Logistics DCSA (Digital Container Shipping Association) DHL Resilience360
Genpact Geodis GEP
GreyOrange Honeywell Intelligrated Infor
Inmar Kibo Commerce Logility
Magnitude Software MPO Old Dominion
Oliver Wight OpenSky Paccurate
Ports America Purolator QAD Precision
Red Classic Riskmethods Snapfulfil
TGW Systems Tradepoint Atlantic Transportation Insights
Watson Land Company Westfalia Technologies Workjam
Yang Ming    
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2021 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing