The focus of the traditional supply chain organization is cost management. Saving money does not drive value. Improving cost also does not necessarily improve margin. Holistic organizational thinking is a marked departure from traditional functional thinking, shifting the need for new forms Read more…
A limitation, which can be removed immediately after identification, is just an obstacle. But a limitation, which cannot be removed for significant time duration, is a constraint. All obstacles can be and should be removed immediately, but a constraint cannot be Read more…
Its Counter intuitive. But true.Ordering more than you actually need makes shortages worse. Typically, a retailer or manufacturer only orders as much as they think they can sell or consume until the next cycle begins. But sometimes a hot seller Read more…
“No one in the supply chain has sold till the time the end customer has bought.” This seemingly simple diktat is hard to put in practise, after all, why do I care if my customer’s customer is buying my stuff Read more…
Shermanโs Law of Forecast Accuracy: โForecast Accuracy improves in direct correlation to its distance from usefulness.โ The statistical forecast is only useful when determining a basis for segmentation, analyzing patterns and creating baseline forecasts. As a result, statistical forecasts about Read more…
Digitizing your business will give you the data you need to sense, shape and respond to demand changes in real time. This will also allow you to apply scientific principles and derive more accurate demand forecasts.Going digital doesnโt break down Read more…
Below are our top four demand planning best practices which will not only mitigate biases and heuristics (mental shortcuts that allows people to solve problems and make judgments quickly and efficiently), but improve overall planning performance. 1. ๐๐จ๐งโ๐ญ ๐ฎ๐ฌ๐ ๐ฐ๐ก๐๐ญ Read more…
๐๐ฏ๐๐ซ๐๐จ๐ง๐๐ข๐๐๐ง๐๐. Overconfidence is a set of biases rooted in an unjustified certainty in the legitimacy of oneโs opinions.In a study done, demand planners were more than 10% more likely to be overconfident that non-demand planners. This phenomenon is consistent with Read more…
One premise of economics is that when faced with choices of varying value, people will choose the greatest value. When they donโt, they are deemed irrational. The reality is that all of us make irrational decisions all the time, because Read more…
Ans: Demand Planning The biggest cost to companies is NOT the cost of employees, or raw material, or sales or even advertising.The biggest cost to companies is the imbalance between the demand for their products and the companies ability to Read more…