With disruptions to supply chains and fluctuations in demand becoming a new normal, your ability to make supply chain plans – and adjust them on the fly – can make all the difference for your business. Here are five critical best practices your company should consider when looking to enhance its supply chain planning processes. 

 Improve demand management 

Demand management requires the analysis of large amounts of data to create statistical forecasts, manage internal demand-shaping programs, and execute real-time demand sensing. To develop better plans, companies require the latest capabilities and innovations in machine learning. Organizations still relying on Excel spreadsheets for demand planning are wasting time on data gathering and analysis that could be more effectively used for problem-solving. 

Advanced supply chain planning platforms provide visibility into all parts of a supply chain, from material sourcing to product delivery, and allow for agility in adjusting forecasts and plans to operational reality. They can add and analyze internal tribal knowledge to help understand the present and future trends, such as marketing and promotion information and third-party information, including weather developments and geopolitical events. Even small increases in forecast accuracy can translate into considerable savings for larger companies. One British auto manufacturer saw an eight-point improvement in forecast accuracy and saved hundreds of millions of dollars after adopting a supply chain planning platform.  

 Enhance supply planning  

In today's environment of supply chain disruption, demand is not the major challenge for many companies — it's supply management. For many organizations, supply planning has become the prime problem area.  

As the situation in the semiconductor industry demonstrates, we’re living in a supply-constrained world. In another age, orders that came in first were filled first. These days, supply must be managed to maximize profitability. That means holistically evaluating risks and opportunities — such as revenues, profit margins, service levels, performance penalties, and customer impacts — and having the capabilities to measure them. 

Some companies cope with today's supply constraints by accumulating excess inventory, hardly an optimal strategy for increasing profitability. By streamlining supply planning and better aligning with demand, companies can make the most of their working capital and execute inventory decisions that produce the most value.  

Today's advanced planning solutions allow users to perform everything from top-level, rough-cut capacity planning to individual production and logistics schedules at the micro level. These solutions can factor in source signals from suppliers and vendors, black-swan events that may hamper deliveries across the end-to-end supply chain, and other external data. This allows companies to tweak plans, update inventories, and understand what can be promised to attain customer service and cost management goals.  

 Balance more effectively 

All companies are challenged to arrive at consensus plans that balance supply with demand. Historically, sales and operations planning (S&OP) was a quarterly process and then gradually monthly as technology and processes improved. As access to real-time data has increased, and with the power of collaboration provided by our mobile devices, S&OP is increasingly becoming a persistent activity.  Business trends such as omni-channel fulfillment, along with ongoing supply challenges, mean planners must have real-time data and the tools to support real-time decisions. 

The evolution of technology and process also supports innovative approaches, such as creating segmented demand and supply planning, which helps planners group product families with similar demand or supply characteristics into micro plans and then merge them into the consensus plan. Supporting this approach through the ability to run scenarios is critical when working toward an accurate consensus plan. Running S&OP plans more frequently increases planner confidence and ensures plans are based on current conditions. In a volatile supply chain climate, visibility and agility are fundamental requirements. 

Supply planning for fast-moving products or market introductions involves dynamic processes. Today's advanced planning platforms can generate unconstrained plans that provide executives with ballpark figures on how their capacity and materials match up with existing programs and how they can be relied upon far into the future. They also empower planners to rerun and tweak plans for more dynamic or constrained scenarios without disturbing the planning processes for more stable product lines and markets.  

 Drive cross-functional alignment 

Historically, S&OP has been focused on planning the materials and capacity required by a manufacturer to meet customer needs. Integrated business planning moves beyond that to consider broader planning criteria important to meeting corporate KPIs, such as manufacturing activity costs and profit margins. The core objective of any business is to maximize profits and customer service simultaneously. From a planning perspective, that requires aligning finance and supply chain data, processes and decision-makers. Critical capabilities around visibility and collaboration are essential to delivering on these objectives. 

Many organizations also have other objectives, such as achieving environmental, social, and governance (ESG) goals and meeting workforce planning objectives. Evaluating the efficacy of these corporate programs requires more data to be integrated into planning processes. That way, executives can measure how individual departments contribute to achieving corporate goals and can re-plan quickly when they see shortfalls.  

Integrating operational and financial planning has become more critical than ever to make informed decisions. Today's advanced platforms have the capability and flexibility to do just that. 

 Leverage the right technology 

Cloud technology and platforms provide the flexibility required for companies to do advanced planning to enhance corporate performance. They're available around the clock and around the world so that data and scenarios can be updated whenever required, allowing companies to make better decisions faster.  

Above all, they can ingest massive amounts of data, enabling the application of artificial intelligence and machine learning to extract insights and actionable intelligence. Modern planning solutions also allow for applying predictive and prescriptive analytics across these data sets — helping companies plan, innovate, and move in new directions quickly and with agility. 

Transform how you see, plan, and run your business 

When it comes to supply chain planning, there is no one-size-fits-all solution. For its 500-plus supply chain customers, Anaplan is the master of flexibility.  

"Without fail, our customers start projects focused on their primary planning challenges and expand into related planning areas that focus on long-term solutions,” says Tom McDonough, Anaplan's senior director of supply chain solutions marketing. "What starts as a demand-planning project may move into a promotions planning project, a workforce planning project, or a supply planning project, depending on each customer’s assessed impact analysis." 

Fundamental capabilities like statistical forecasting, supply optimizations, and multi-level collaboration with guided problem resolution are available to each planning solution. "We have 30 statistical forecasting methods built in," says Dr. Deborah Pike, principal supply chain consultant for Asia-Pacific, “providing the most appropriate method for each customer.” Statistical forecasting with ML-enabled technology from Amazon (Amazon Forecast) and Google (Vertex AI) are options for any planning customer. 

Anaplan interfaces with other big-data platforms, like Google’s "digital twin" that apply machine learning and artificial intelligence to create virtual supply chain models. 

"We're ahead of our competitors in introducing AI and ML into supply chain planning," says McDonough.  

The platform’s specialty, adds Abdul Shroff, vice president for strategic CFO growth practice, "is its ability to connect people and data to orchestrate a process that allows senior management to make informed decisions in an extremely fast-moving environment."  

The flexibility also makes it easy to connect with multiple tiers of suppliers, supporting more streamlined supply chains for vendor-managed inventory and contract manufacturing.  

Older enterprise systems, like ERP, were never optimized for planning. Anaplan's platform, says Pike, provides "the right tool to do the right job."  

Resource Link: www.anaplan.com