Category Archives: Demand Planning

Whether to constrain the demand plan can be a tricky topic.  We say that the best practice is to plan unconstrained demand, but what does that mean, exactly? The difference between constrained and unconstrained demand pertains to our ability to meet and satisfy that demand with our planned supply capabilities.  Unconstrained demand does not meanContinue reading “Demand Planning – Constrained or Unconstrained?”

In one of my previous posts, I wrote about the Demand Planning function having a wide range of homes in the org chart.  Where the Demand Planning team resides organizationally, however, does not necessarily define where the demand plan is owned. Much like in a RACI framework, the role that is Responsible for doing theContinue reading “Accuracy or Ownership: Which is more important?”

I noted in a previous post that language can be confusing when it comes to planning, and I have to say that we don’t do ourselves any favours.  From time to time I come across discussions that pit DDMRP (Demand Driven Material Requirements Planning) and traditional Demand Planning against one another and judging by theContinue reading “Demand Planning and Demand-Driven (DDMRP) – Better Together?”

When we use the term customers in the context of demand planning, most often we are talking about the people that buy our products and services.  However, it is equally important to think about the internal customers of the demand plan – the functions within your company that rely on the demand plan as aContinue reading “Who are the customers of the Demand Plan?”

In one of my earlier posts, I stressed the point that eliminating Bias in the demand plan is critical to establish trust in it.  Without trust, the plan is second-guessed or disregarded. Acknowledging that point, however, does not give leadership much comfort when the demand plan falls short of business objectives. Providing visibility to thatContinue reading “Go Get’s, Gap Fillers, Plugs, and other Bad Behaviors”

When working with companies to improve their demand planning, I regularly get the question: “What is best-in-class forecast accuracy?  What does good look like?” It’s a tricky question to answer.  Many considerations must be taken into account to establish an appropriate definition.  Cumulative lead times and planning time fences guide us to when, and atContinue reading “What is best-in-class forecast accuracy?”

One of the first things that I do when working with a company is carefully listen to the words that they use to describe their planning process, and then understand what their definition of those words is. In many fields there is a common terminology that gives specific meanings to words or expressions. Medical terminology,Continue reading “The Importance of Language in Planning”

Often businesses struggle with a demand planning process anchored in numbers.  If you are spending your time trying to reverse engineer forecasts to understand why one number is different than another, then you are facing the same challenge. As we move to an assumption-driven planning process, one of the best capabilities to develop is toContinue reading “Good Questions drive Good Assumptions”

When someone wants to change a plan number, the questions to ask are: “Why? Which assumption has changed, and is there agreement on the impact of the changed assumption?” Think about the demand planner when someone instructs that a planning number be changed without explanation. (By the way, the same goes for supply planners.) TheContinue reading “Overriding the Demand Plan”

Leaders, like most people, make decisions and operate on that which they trust. If they don’t trust the demand plan, they will most likely adjust, override, or ignore it. How should we measure the trustworthiness of a demand plan? Forecast accuracy is where many would start, but measuring bias is the more fundamental and importantContinue reading “Trust in the Demand Plan”