Demand Planning Methodology in Supply Chain Management

A supply chain is the system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. In Supply Chain Demand planning is a critical business process that impacts Fast Moving Consumer Goods (FMCG) companies’ ability to manage their value chain business performance. Revenues, costs and asset utilization are all affected by the quality, timeliness and accuracy of demand planning. Cleaning History and Reason Code Analysis offer new solutions that can improve the demand planning process and yield business results. A demand planning methodology and few applications have been shown here. The potential of this Demand Planning Methodology is to improve the†¦show more content†¦Obtain a Cleaned Base History: Base Demand + Activities + Circumstances = Final Demand Plan When changing the demand planning process to adopt the concept, markets need to adapt historical data. This task will be done once during the implementation of the concept. Maintain a Cleaned Base History: Once the concept is in place, maintain the Cleaned Base History by cleaning history of the new historical data. This task is to be done every month/week in the monthly and weekly Demand Planning cycles. Validation of Cleaning with Statistical Forecasting: Statistical Forecasting tools are strongly recommended to support â€Å"Obtain a Cleaned Base History† process. Indeed, Demand planners and Sales Marketing need to validate the consistency of the Cleaned Base History with statistical simulation tool. Judgmental approach: This involves the knowledge and experience of the Demand Planners and people from Sales Marketing. Their judgment based on the business experience is the most important input in the cleaning process. Mathematical approach: Mathematical and graphical techniques support the judgmental approach. They highlight data that, potentially, need to be cleaned and thus ease the manual work. Distinction is needed for three types of products: The strategy to clean depends on the category:  · Category 1 : Mix products Detailed cleaning is necessary  · Category 2 : Baseline products Only exceptional circumstances will be removedShow MoreRelatedAn Empirical Analysis Of Supply Chain Risk Management1692 Words   |  7 PagesHoenig in the paper titled â€Å"An empirical analysis of supply chain risk management in the German automotive industry† applied the practices of supply chain risk management by surveying sixty-seven manufacturing plants in German automotive industry. The need of real empirical research in supply chain risk management to help analyzing supply chain risk and test the previous research proposed instruments that can be applied for supply chain risk management was the motivation of this work. 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