A Wake‐up Call for Demand Management

Traditional demand planning processes have become inadequate, and executives are quickly finding themselves facing extreme pressure to deliver their products and services to meet shifting consumer demand patterns. The uncertainty of consumer demand occurs during times when a business or an entire industry is unable to accurately predict demand for its products or services. Demand uncertainty at the retail customer level tends to get magnified from the consumer back through the entire supply chain to the consumer goods raw materials suppliers. The bullwhip effect is a distribution channel disruption in which demand forecasts yield supply chain inefficiencies. Demand planners spend roughly 80% of their time managing information and cleansing demand history. Before companies can address all the demand management challenges of people, process, analytics, and technology, they need to address the many existing bad practices and truly embrace the benefits of analytics-based planning.