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Demand planning is a critical function in supply chain management that requires accurate and timely forecasting of customer demand for products and services. However, many organizations s ...
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Today, we would like to talk about S&OP (Sales and Operations Planning) and its emerging trends and innovations for supply chain excellence and strategic planning. S&OP ...
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Forecasting vs Planning I recently read a post that distinguished between the two. Such a distinction seems academic at best for many reasons… I know several of you th ...
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Major Roadblocks to Capturing True Demand In the fast-paced and ever-changing world of business, it's becoming increasingly important for companies to capture true demand. Und ...
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Value with an Attitude - Podcast by Dr Mark Chockalingam ...
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How Does Forecast Accuracy Matter Anyway? I recently saw a post by Sujit Singh on LinkedIn that tabulated how one would rate different companies on their Forecasting process based on ob ...
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ABC XYZ Segmentation in SAP IBP The ABC XYZ segmentation has become a cottage industry on its own in the last 20+ years. I remember presenting this in an IBF conference many years ago s ...
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The New Supply Chain World order is here - Are we ready? Tectonic shifts are taking place in the global supply chain and the new world order is emerging at a furious pace. The foun ...
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The Next Big Thing in Forecast Accuracy My (Our) practical experience NOT just an opinion - of course, this post is not meant for experts who neither believe in forecast accuracy nor i ...
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What is the ideal forecasting (Time) bucket or micro-period? When it comes to dealing with time periods in forecasting, the periodicity or frequency of the forecasting cycle is one ...
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Where Does It Hurts: Demand Planning Pain Points Demand planning is one of the most fundamental operations in supply chain. While planning for the future is already a challenge, asse ...
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Transform Your Demand Planning Process If you want to transform the Demand Planning process at your organization, first do a little study of the different touchpoints between Four key ...
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S&OE - Sales and Operations Execution. My response is two-fold. MPS or Master Production scheduling is the process of assigning resources to meet the demand both short term a ...
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Where Are You In The Planning Journey? The Pandemic has exposed NOT just the gaps in the infrastructure but also our processes and process mindsets. Are you still throwing Dar ...
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America is running out of everything! This shortage may not be a supply chain problem - this is just a supply problem. Alarmingly, stagflation may not be the result. Stagflati ...
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S&OP - Stop Looking For Consensus On Achieving A Single Number! The term "consensus" is often misinterpreted. The process of driving to Consensus is more important than ...
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Where Does Your Company Stand In The Demand Planning Spectrum? Planning is about the future. Although historical demand is a good starting point, it is important to have a f ...
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Incorrectly diagnosing inventory planning issues can have massive consequences with respect to excess inventory, stock outs or both. The good news – by analyzing plan changes over ...
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S&OP Implementation and S&OP Process Benefits Sales and Operation Planning (S&OP) is perhaps one of the most commonly used processs in many organizations but also commonly ill-formed ...
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True Demand: A Key Building Block In Your Demand Planning Process An important building block to creating an accurate demand plan is the veracity of your demand history. S ...
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Beyond ERP Reports And Excel Spreadsheet It is well confirmed correlation between demand visibility and corporate profitability. Almost all organizations with better demand planning and good agilit ...
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Customer Requested Delivery Vs Availability Delivery Date Does the customer really want the product to be delivered on the requested date? Some companies think this is not a ...
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Calculating Attach Rates For Forecasting Demand for Accessories can follow the path of the original equipment and can be highly correlated to the demand of the original item - but there ...
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How Do You Calculate True Demand? When calculating true demand, we need to classify the orders into the correct month of demand - it depends on when your customers wanted the produc ...
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AI - What is the Hype? Today, AI sells everything from driverless cars to carless drivers... Everywhere you turn it is all about AI. Are we peaking on the hype cycle? There is a euphoria on ...
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Do We All Have Inventory Fetish? I mean the Lean Fetish that says Inventory is all evil. I just read a post on Linked-In that said Work-Center Utilization metric is a "Dysfun ...
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As Nasdaq Soars, Are We In a Bull Market? Irrational exuberance?! Out of touch with reality?! Perhaps a dreamy La La Land of stocks and Index funds fueled by tweets and free money ...
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New ML Methods For Improving Supply Chain Management We are currently testing the Azure Machine Learning algorithms for demand planning to see what automated ML can bring for the plan ...
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Precision is key to your planning and execution. What is your next step? What is your next step? Even if you have only one step to take and that will be a hop.... hop ... and ...
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Should forecast accuracy be a stretch goal? Should forecast accuracy be a stretch goal? Many businesses are struggling with demand visibility and low SKU-level forecast accuracy - somethi ...
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Best Practices of Forecast Pass in Demand Planning The final moment when a demand plan attains Nirvana is when it is passes from the Demand side to the supply chain.... This trigger is termed t ...
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US has 2 Million Doses of an Unproven COVID-19 Vaccine? Ready to Ship? 2 million doses of an unproven vaccine? Ready to ship? Which one? Only Moderna has completed Phase 1 and oth ...
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Bridging the gap between Demand Planning & Financial Forecasting The Great Pandemic created the great disruption although not a dislocation yet - all of us are huddled inside our homes ...
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Supply Shortages Continue during the Pandemic Month 3 of the pandemic - We are still out of stock on Hand Sanitizers, Face Masks and Gloves. If I ask the store clerk do you have ...
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Good tidings from the Peak - Summary from our modeled results All Models are wrong while some are useful. The most useful models are the ones that work with limited and imp ...
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Volatile Markets - Signs for the Future The bubble has burst and the market crash has exposed many sins underlying the excesses of the past few years. Three significant factors are at ...
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Modeling the Covid-19 and its global invasion The World has entered an unusual period in modern times - a large scale epidemic that is spreading like wildfire across the glo ...
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Demand Bull-whip With the advent of the Corona Virus in the USA, there is pandemonium in the economy besides the pandemic that is creating a lot of turbulence. The US ...
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Oil price at $25? How will US production survive? Is this an Arabian trick? Saudi Arabia has now set a unilateral price and decided to pump enough oil to flood the worl ...
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Certified Analyst in Demand Planning - Boston - MA CADP is the first level of certification directed towards planners and analysts. The certification will give you a compet ...
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The Bubble!! Are we in one - slowly heading up like that DisneyWorld Splash mountain ride before that exhilarating drop into the water splash?! The one difference between Spla ...
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Corona Virus and the Global Supply Chain III The virus may be under control but the effects will start to show in the global supplychain for a few months. - a good portion of China is ...
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Consensus Demand Planning - Forecast Overrides In a demand consensus process, a typical scenario could be an over-ride of the customer aggregated bottom-up forecast. Without worr ...
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Corona Virus and the Global Supply Chain II The Chinese Government action in the wake of the Corona Virus crisis signals there could be a financial panic in China. China injected ...
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How does Waze predict your arrival time so accurately? Waze and Google Maps are two of the most popular mapping and driving apps in the World, although my unscientific observation is ...
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ABC Classification for Inventory Management Trash your ABC classification! And do yourself a favor - start over again. The ABC classification was formulated about fifty+ years ago ...
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Plan for Short Life Products Planning for a short shelf-life or perishable supply chain can be challenging. A large part of the cost here is obsolescence - stuff that you throw a ...
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Can Safety Stock be negative? Can your planning process allow for carrying no safety inventory or in the extreme a negative safety stock? In other words, can you ...
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Who owns the Forecast? Demand Planning as a function relies on customer information and sales intelligence that provides insights into customer activity. Most companies have ...
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Product Life cycle and Trend Managing Product Life cycle in SCM can be an intricate challenge – this is a key factor for both Demand Management as well as Supply Chain ...
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Is Demand Planning MIA? Is Demand Planning missing in action in some companies? Or is it completely missing and never part of the operational planning process? I know smaller ...
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Demand Planning Vs S&OP Process Flow When people talk about Sales and Operations Planning, there is a grey area. In some of our diagnostic engagements I have noticed that ...
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Usable Solutions: Valtitude's Core Mission Valtitude’s core mission is to provide usable solutions! Usable solutions that are worth the price and provide a c ...
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PlanVida: Inventory Analytics One of the roadblocks many small companies face (and some large Fortune 500 companies as well) is the lack of a clear insight into the alloc ...
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Forecast Level Optimization In a recent client engagement, there was some lively discussion on Demand Modeling using the Product/Customer Hierarchy. ...
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The Science of Optimal Inventory A key consideration to inventory optimization is to have a strategic view of how to allocate your inventory dollars among different t ...
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Data Cleansing and Outlier Correction The SCM planning solutions market is getting pretty crowded these days - almost everyone has a solution on the cloud for Demand, ...
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What is Tracking Signal - Tracking signal is used to measure persistent bias - either under-forecasting or over-forecasting. This is a useful supply chain metric in the planner's tool k ...
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What is new in SAP IBP 1908? SAP IBP 1908 brings some much awaited updates to the advanced supply chain planning platform. Some are marginal enhancements while others are significant chan ...
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What is Demand Sensing & How Does it Differ From Demand Forecasting? Demand sensing is a supply chain management technique that involves using real-time data and advanced analytics to better un ...
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What is MAPE & WMAPE? MAPE - Bias refers to persistent forecast error - Bias is a component of total calculated forecast error - Bias refers to consistent under-forecasting or over-forecas ...
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Is your organization ready for IBP? How do we know that we are implementing this nifty solution that could NOT be used if the process and people are not ready? ...
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SAP IBP- Improving accuracy reporting with WMAPE SAP IBP defines additional metrics to evaluate the forecast quality of the statistical forecasts compared to what we had in SAP APO. The biggest imp ...
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Demand Planning With True Demand For the following scenario which of the following historical orders data stream you would consider from a demand planning perspective? ...
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Simplicity is NOT that easy in planning! Some planners just are very proud of the fact that their business is complex – 20K SKUs, 20 DCs and thousands of customer sold-to location ...
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Impact of Trade War on Global Supply Chain In 2017 we imported $500B worth of products exported about $125B. Here is a trend of Trade deficits over the last 15 years &nb ...
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SAP IBP Vs SAP APO (SAP SCM) As the leading authority on Model Tuning and Optimization in SAP SCM (formerly known as APO) we have extensively researched on modeling capabilit ...
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Customer-specific SKUs vs Virtual warehouse Should we create Customer-specific SKUs to reserve inventory for our best customers? I hear this client question often ...
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Is WMAPE over-rated as an organizational KPI? Many are taking shots at the very thought of measuring Forecasts itself leave alone with WMAPE. And some are taking shots at the discipline of ...
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Can we combine the role of demand planning and supply planning? The Planner! Sounds like a movie title – the movie we have not seen and Pixar has not thought of…. What is ...
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Sales Planning - What is their value add? Who are Sales Planners? Do you have a function called Sales Planning in your organization? Most companies call it Sales Planning or Sales Logi ...
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The Bitcoin is the modern version of the Dutch Tulip! The Bitcoin has just breached 14K. One bitcoin is worth 14,000 US Dollars as of the close of the market on December 6th. It was trad ...
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Leading brand name companies such as P&G, General Motors, General Mills are facing the onset of unknown competitors powered by big data analytics and technology ...
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Measuring Forecast Error Do you consider a Constrained or Unconstrained Forecast? I had a long conversation recently with the President of a CPG company on adding some form of Forecast quality a ...
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Measuring Customer Service: Variety causing confusion? The perfect method to measure customer service is to find out how your customer is measuring you. Over time organizational score cards&nbs ...
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What to measure for forecast accuracy? What to measure for forecast accuracy? SKU/DC, SKU/National or SKU/Plant? It is now well settled that we want to use the Weighted MAPE to mea ...
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17 Resolutions for a Demand Planner in 2017 Following are 17 suggested resolutions for your demand planning in 2017! 1. Trust the Stat Forecast . Although there are caveats, if tuned cor ...
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Role of Sales Planning in Supply Chain Transformation When we think about IBP – Integrated Business Planning – we need to consider the roles of the various plann ...
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Flexible Supply Chains and broken links “The measure of a person’s strength is not his muscular power or strength, but it is his flexibility and adaptability.” The sa ...
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How successful is your Supply Chain? Key factors for a successful supply chain – Product Assortment Visibility to Customer Wants and Needs Ability to successfully modi ...
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From Bricks to Clicks There is a huge competition amongst e-tailers and retailers to win customers by providing good customer service and quick delivery. Furthermore, all of this at a ...
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Inventory Counting with Drones at Walmart Inventory Management has been a pain point for many companies – retailers, manufacturers and service companies alike. Companies have been figh ...
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Target Supply Chain Initiatives – Managing Suppliers In the past few years Target has expanded its business into selling fresh produce, meat and other perishable food items. With bein ...
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In recent interactions with many companies, we have observed that people don’t use a specialized tool for forecasting. Yes, they do most forecasting in EXCEL. ...
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Sailing through the SAP APO Ocean As we all know SAP is an Ocean where the chance of getting lost is quite high. Below are key takeaways from my experience while working o ...
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October Demand Planning and APO workshop I am just getting ready for the Chicago trip – our annual event in Demand Planning. But this ...
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True demand for supply chain Planning Quite often we get these questions from our constituents and Network members about the definition of demand. 1) Can I consider shipments as my demand? ...
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Help my MAPE is negative! I hear frequently calls for help saying MAPE is high or saying MAPE is unreliable. Recently we encountered two situations where the calculated MAPE & WMAP ...
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The importance of Black Swans in our planning process Our everyday experience in Social media appears to be clouded by a few words and excitement. ...
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Is S&OP an Event? What is the state of S&OP today? I interact with supply chain professionals in conferences and consulting assignments across different industry verticals.&nbs ...
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Window-dressing and Supply Chain Score-carding When we review Supply Chain Dashboards, there are a variety of colorful metrics. Are they the right metrics – Are they calculated right ...
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Difficulty in measuring Service Levels In some recent visits, I have noticed something interesting about KPI Reports & the calculations used. It appears ...
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Demand Planning & Sales Forecasting Boston Workshop During the Demand Planning and Sales Forecasting workshop in Boston, we will be discussing the demand planning challenges in Oil & ...
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Order to Cash Process When companies take a hard look at their business model and the underlying process, what is the key objective that is motivating them? 1. Return on Investment ...
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A correlation between Inventories & Forecasting? Some say yes………. and some say no! There are many things questionable about Statistics and Modeling and of cou ...
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SAP APO for Weekly Forecasting Generally, demand planners forecast at the monthly level since forecasts are well behaved and seasonality is easy to identify in months. But ther ...
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How Important is Integration ??? Continuing on this discussion on the important properties of a Planning Software application, I will discuss integration this week. What is integration ...
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Planning Software – What should it be ??? Having worked with many software applications for planning – demand, supply, finance, and S&OP – I have experienced a sense ...
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Coming to Oil & Gas Country - Demand Planning and Forecasting - Texas Feb 2013 We will be hosting our first ever public workshop in Texas due to popular request from our Oil & Ga ...
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Keep Cribbing or Find Solutions There was an interesting technical issue at a client using SAP SCM with substantial investment in demand planning using SCM tools. After so ...
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Demand Sensing, Demand Shaping and Demand Management - Are demand planners doing these activities today? Demand Planning Net focuses on the disciplines of Demand Forecasting, ...
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Forecast Error Benchmarking Our Newsletter readers and forum participants ask very frequently: · Which metrics should I use to measure my forecast performance – WMAPE, MA ...
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Throw away that application software if that is not usable! Your planners may have already boycotted the tool and resorted to Excel and offline analytics for most of their planning work. T ...
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Statistical models in APO DP Find out and bench mark with your peers from companies such as Michael Foods, Chemtura, Newell Rubbermaid, Johnsonville Sausage at our upcoming workshops. Wi ...
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Are you creating Forecasting classes using your Supply chain’s ABC classification? Bad idea!! I have preached Usability and Model tuning for demand planning applications like SAP, JDA ...
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Demand Planning just published our first e-Book Forecast Reconciliation and Proportional Forecasting! This is the first direct-to-Kindle book from Demand Planning, and we’re proud ...
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Tackle intermittent demand problem Intermittent demand or sporadic demand is a fact of life. In many cases, demand occurs in one lump followed by periods of no demand. What drives ...
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NORMSINV Excel Formula function in Safety stock calculations There was a question on Linked in about the use of the NORMSINV function in Excel. Initially the poster mentioned the NORMSDIST ...
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Is Statistical Modeling an After thought? I just had a conversation with a Fortune 500 executive recently. He mentioned his company is spending tens of millions of dollars cu ...
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Slow Moving, Short History and Intermittently demanded products – How to forecast? Every time we come across a slow-moving item, we have to spend quite a bit of time analyzing the dif ...
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Automatic Outlier detection - Blessing or Curse? One of the puzzling questions that Demand Planners ask in our training workshops is why their software produces a flat forecast 90% of th ...
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Moving the ROC to forecast....... We hear quite often, that forecasting is a waste of time. People often cite the weatherman and laugh at forecasts and forecasting as a productive pro ...
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Questions on Demand Planning Training Workshop in India In response to our workshop announcement, we have received several emails with number of questions. Given that we have only ...
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Press Release from Draper Laboratories CAMBRIDGE, MA – Draper Laboratory is leading a team that aims to improve long-term intelligence predictions through software that weights most ...
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Demand Planning and Forecasting in Bengaluru, India January 27-28, 2012 After a two year hiatus, I am looking forward to facilitating our hugely popular two day workshop on Demand Planning ...
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SKU Level Forecasting Talk to any supply planner, they will say they need a forecast at the SKU level. The more detail the better. So the demand planner is on the defensive, he nee ...
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Why moving averages in APO DP rarely move? When I was a beginning student of Statistics in High School, I was fascinated by moving averages. This is pretty cool stuff to get an avera ...
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Predicta Forecasting Tool - New Kid on the block!! We had the opportunity to test drive the Predicta Forecasting application over the last couple of weeks. This is an Excel add-in sof ...
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One day workshop on Statistical Modeling and Metrics in SAP APO DP If you are using SAP APO, did you notice APO DP calculates and defines error metrics with its own unique formula that is d ...
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Forecasting Efficiency Quotient (FEQ) vs. GMRAE There are more questions on the comparison between FEQ and GMRAE. Please review the material on the http://www.demandplanning.net/ ...
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The Forecasting Efficiency Quotient As demand planners, have we added value through forecasting? Is your forecasting effort efficient? You can answer in the affirmative, if your di ...
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How to forecast in excel? Join us on September 21-22, 2011 in Boston at the Demand Planning Tutorial. Based on some of the inputs from our clients, workshop attendees and the chatter on Lin ...
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Demand Metrics for Forecast Diagnostics We just published a new Demand Metrics Diagnostics Template for all DPNet users. This template is provided as a reference to calculate the health ...
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Calendar effect in forecasting As we know last weekend was long holiday for US. Our sales was also affected. So for forecasting can anybody suggest how to include calendar effects in ...
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September 21-22 at Four Points by Sheraton Our recently concluded May 2011 two day Demand Planning and forecasting workshop was an immense success. I personally enjoyed the interaction ...
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Forecast Bias over Tracking Signal Tracking Signal is used to measure forecasting bias over time for the same SKU/Product especially when bias approaches extreme proportions and crosses a t ...
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Forecast accuracy (%) - Valtitude Regarding the measurement of the forecast accuracy I would like to ask a question. The Formula 1 below shows a common (or intuitive) suggestion a ...
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Confusion of MAPE/MPE calculation I have some confusion of MAPE/MPE calculation, since the source is different, the methodology is also different, indeed confused. For MAPE, 1)average o ...
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Customer Focused Supply Chain Collaboration I will be speaking on Customer Focused Supply Chain collaboration on Wednesday Oct. 13th at the Bear & Grill Restaurant, Orange CT at 6:30pm ...
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A user in an APO forum lamented: “I am trying to use the Moving Average option in APO DP but I get a static forecast that remains constant for all the future months based ...
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Forecast Modeling capabilities in SAP APO vs. other statistical tools I will take SAS software and Forecastpro as benchmark tools here to compare the capabilities of APO DP. Between SAS ...
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Calculating MAPE - special cases: Obsolete Stock When calculating MAPE what is recommended when actuals are positive but forecast is 0 (for example when clearing obsolete stock)? Can ...
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Demand Volatility vs Forecast Accuracy There was a post on one of the Linked-in Groups that got my attention today. How do you reduce demand volatility using better forecasting? Fo ...
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I saw this linked in comment in a discussion group: “I hate to get technical”. That expression always bothered me, but I am wondering who IS getting technical….who is usi ...
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Value Chain Metrics and Score-carding One of the Key steps to improving your Value chain is to measure and score-card the current state. If you don’t measure where you are, how ...
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Demand Planning for CPG Companies - Valtitude Consumer Packaged Goods Companies seeking forecasting accuracy improvement are faced with a number of issues such as: • Data availabili ...
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Too Big to Fail? Too small to save? Too inefficient to work with? Too old school to educate? Policy makers hang on to the idea, or more like fear, that it is too risky to let big banks fail ...
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Business Forecasting when trend is not your friend....... In the demand forecasting tutorial in New Jersey, there was a key question on forecasting during a recession. Forecasting is ...
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Excellent participation in the Forecasting Tutorial The forecasting workshop on Oct 22 and 23 held at Whippany, NJ was well attended by companies from different industries from Consumer goo ...
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Demand Planning and Forecasting Tutorial - May 6-7, 2010 Workshop is conducted on Thursday and Friday, so you can spend the Spring weekend in gorgeous Lexington, MA or see the yachts ...
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Bull-whipping or driving the Demand? Bullwhip effect is a phenomenon of demand being overestimated or underestimated as it passes through various stages of supply chain resulting in exagger ...
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Is SAP APO DP complicated? I have heard feedback from many business users and demand planners that SAP APO DP is complicated. Some think it is too rigid!! I have heard that it i ...
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SAP APO Demand Planning - usability versus functionality I have heard from Consultants and business managers across many companies: Very rarely there is user adoption of standard APO f ...
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Forecast Alerts! Popular software packages have forecast alert monitors. Each software may term it differently: 1. Manugistics calls them lists 2. APO and Dematra call the ...
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What is Tracking Signal? Tracking signal is a measure used to evalue if the actual demand does not reflect the assumptions in the forecast about the level and perhaps trend in the demand pr ...
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Can we use Multiple Linear Regressions to model sales promotions? The simplest approach to model promotions is through interventions. This is also called event modeling in the literature. W ...
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Model Diagnostic - R squared or MAPE? We have now settled that MAPE or Mean Absolute Percent Error is the measure for forecast performance for a planner/Division at the end of the month.&nb ...
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Why is it important to learn new techniques than banking on century old DOH measure? The Days of Supply is a thumb rule calculation used to manage inventory during the era of green accounti ...
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Is MAPE controversial? MAPE = Mean Absolute Percent Error. This is the common error measure used by the Supply Chain profession. Demand Planners and Demand Forecasters spread ac ...
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Welcome to the forecasting blog! These are collection of thoughts on forecasting, demand planning, Sales and Operations planning and corporate strategy! Please contribute your t ...
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SAS format library To check out the contents of the format library, we use the proc format statement with a fmtlib option. proc format fmtlib library=catlgdata; select ...
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How to Change OR Converting Date Format in SAS SAS is very helpful but can be complex as well. Because of the flexibility it offers, it has to be necessarily complex. The m ...
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INTNX Funtion In SAS The SAS INTNX function is very useful however you should be careful when using the time increments. If you use next_month=intnx('month',t ...
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Creating Weighted Statistics in SAS I wanted to use Proc means to calculate weighted statistics but the options seem too involved. In the specific example, you have hundred ...
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Importing a file into SAS We need to know that SAS uses the first row of data right after the header row as a guide for the values by column! So if the first row contains a ...
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S&OP Best practice: Engage in ongoing cross-functional communication rather than wait for “the meeting” once a month! S&OP Best practice: Engage in ongoing c ...
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Best and Worst Practices in Demand Planning The New Jersey Chapter of APICS invited me to present a one-day training workshop that elaborates on the best practices speech I have been giving ...
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Response to MAPE and MPE Calculations - Mark Chockalingam Thanks to Yingli for the question. Here are the equations that you originally sent through email. ? ==> This calculates th ...
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