David Barton, general manager for North America with ToolsGroup, describes the ways in which various industries are approaching the challenge of planning for demand in an environment of extreme uncertainty. And
The challenges confronting companies today are “wildly different,” Barton says. Some are struggling with a plunge in consumer demand, while others are rushing to keep pace with spikes in sales of essential goods. “We’re seeing unprecedented peaks and valleys,” notes Barton, “and some companies are experiencing both.”
Those companies that had already built a digital model of their supply chains prior to the pandemic are in a better position to weather it now, Barton says. “They’ve already lived in the model for some period of time.” They’re able to simulate various scenarios based on supply constraints, giving them an advantage in the current market over technology laggards.
What all companies have in common is the need to “drill down into the inventory situation,” Barton says. Many have long lead times, and disruptions at any point along the supply chain can have a severe impact on fulfillment and customer service. One European maker of durables and kitchen equipment is overlaying “dummy demand” for a future period, so that it doesn’t get false signals of a lack of demand during the current period.
As if that weren’t enough, consumer-goods producers now face the challenge of satisfying demand in the coming peak holiday shopping season. Those that have turned to automation can employ machine learning as a means of studying recovery in regional markets, and make better allocation decisions in the process.
Barton urges companies to make the necessary capital investment in automation, even in this most difficult of times. Technology can give them a leg up in planning, “so you’ll be more nimble than the competition.”
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