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Are you still following the old version of Demand Planning?
Demand Planning is an important part of the S&OP process. It dates back to early 1980s in the pre-ERP, pre-Internet and pre-Excel times. Demand data had limited availability. The only reliable data source was company’s invoices, which were often compiled manually into monthly reports. We had no way to get more frequent demand data in a comprehensive and reliable manner.
The practice of monthly demand forecasting started with these severe limitations.
Now that the demand data are available at multiple stages of sales, frequency has improved to daily for most companies, and we have high computing power at our disposal, should we continue to follow the old monthly process?
Demand Sensing has evolved as a vastly improved process, exploiting better demand data, frequency of update and vast computing power.
What’s stopping you from the upgrade?