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In today's complex business environment, organizations need to be guided by a purposeful and integrated business planning approach that focuses on common targets. Unfortunately, companies that adopt integrated business planning have a tendency to get lost in challenges of sourcing data, as well as planning spreadsheet templates, decision logs and other seemingly sensible tools. Technology can fix that flaw. By leveraging a common platform that shares data from across the enterprise, organizations can gain full visibility on progress and potential actions.
By 2020, technology's effect on business planning will be felt throughout the supply chain. Here are several areas to watch.
Today, many business functions create their plans in silos. As organizations deploy improved platforms, plans will become more integrated with fewer handoffs between departments. And as the forward-looking planning process converges, reviewing the feasibility of proposed plans and potential scenarios to improve the bottom line in a synchronized manner will be a norm.
Advancements in computing power and solution techniques allow for enterprise-wide planning capabilities with multiple levels of granularity. Future demand and supply balancing and planning models will enable a single planning model that will support IBP and supply planning. Today, highly automated advanced statistical forecasting has been used more and more, and it will become a standard in baseline forecast generation. And while the concept of range planning exists today, in the near future the stochastic elements of planning will be used commonly in generating plans with confidence intervals vs. deterministic single numbers.
A new layer of automation is set to take the hard work out of planning and make it more accessible. Cognitive computing aims at replicating human decision-making. Academic advances in artificial intelligence such as expert systems, genetic algorithms and neural networks of the 1980s and 1990s enjoyed limited commercial success. However, the computing power and new interest in planning automation will change that. The new capabilities will allow capturing and replicating human decision-making, allowing computers to support better planning decisions in an unstructured manner like humans. Automation through cognitive computing will enable companies to make better decisions, faster and in real time.
Planning as a service
The complexity of planning will continue to send organizations to third parties for assistance. External service providers have a great deal of subject-matter knowledge to supplement that of in-house users, and they have a high level of competency with technology platforms that can be difficult to develop — and retain — within the organization.
Effective planning and execution can be a source of competitive advantage through the formation of timely insights, establishment of corrective actions and anticipation of future events. Although IBP has been a burden to organizations in the past, new platforms are re-engineering the process to be more automated and forward-looking. This simplified planning process is likely to increase adoption and lead organizations to expand their planning across the enterprise.
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