Question

Please explain why is important to plan the demand, and how is demand planning achieved?

Answer 1

Importance of planning the demand:

In order to keep your customers satisfied you need to provide them with the product they want when they want it. This advantage of planning in business will help predict product demand. So that enough product is available to fulfill customer orders with short lead time and on-time.

Estimating future demand is one of the most valuable activities in any organisation. The demand plan’s impact is felt throughout the business, from sales and marketing to manufacturing and distribution. The right plan can balance inventory levels with costs and lead to higher customer service levels and positive cash flow.I have realised there are four critical elements that support a company’s growing demand planning maturity.they are :

1.move beyond spreadsheets.

2.Disaggregate high level demand forecasts to tactical level.

3.focus on high value add activities.

4.spotlight on colloboration.