The Power of Demand Planning Cdric Hutt Product

The Power of Demand Planning Cédric Hutt – Product manager, Dynasys | Building the Effective Enterprise

The Power of Demand Planning Safe Harbor Statement The following is intended to outline QAD’s general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, functional capabilities, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functional capabilities described for QAD’s products remains at the sole discretion of QAD. | Building the Effective Enterprise 2

The Power of Demand Planning Presentation agenda ■ ■ ■ Session overview You are all planning Forecasting is a process Demand planning supports the process Summary and questions | Building the Effective Enterprise 3

The Power of Demand Planning You Are All Planning | Building the Effective Enterprise

The Power of Demand Planning You Are Already Planning! customer supplier Because ■ You need to act before you know ■ Lead time > sale cycle ■ Deciding nothing is planning | Building the Effective Enterprise

The Power of Demand Planning Accurate Forecasting Gives You Manufacturing resources Logistic resources Stocks Service level Properly allocated Stocks Emergencies Cash | Building the Effective Enterprise 6

The Power of Demand Planning Involved KPIs ■ Metric: forecast accuracy ■ Key metric: stock level ■ Key metric: customer service level 40% Stockout risk 35% Probaibility 30% 25% 20% 15% 10% 5% 0% 0% 20% 40% 60% 80% Relative standard deviation | Building the Effective Enterprise 100% 120% 140% 7

The Power of Demand Planning Actual improvements ■ For existing customers ■ Forecast accuracy: § +10% ~ +40% § Mayoli: 60% -> 75% 80 60 40 20 0 before after ■ Stock level § -10% ~ -50% § Cadbury: -50%, 1 warehouse ■ Service level § From +5% to +30% | Building the Effective Enterprise 120 100 80 60 40 20 0 8

The Power of Demand Planning Forecasting Is a Process | Building the Effective Enterprise

The Power of Demand Planning How To Plan Demand ■ Demand comes from § Sales forecast § Forecast consumption § MRP / DRP ■ How to forecast? § Explain the past sales § Make assumptions § Extrapolate | Building the Effective Enterprise

The Power of Demand Planning Extrapolate From the Past? ■ Many factors can be seen in the past § Trend § Seasonality ■ Many are not § But people know § Knowledge is diffuse | Building the Effective Enterprise

The Power of Demand Planning Collaboration Required ■ Gather knowledge ■ Need an effective process § Central forecast to update proposal § Collaborative workers to review proposal § Monitoring and improving ■ Share assumptions and risks | Building the Effective Enterprise 12

The Power of Demand Planning Software Required ■ Forecast lots of data § For items § Per site § Each month at least ■ Initial forecast should be good ■ Exception based | Building the Effective Enterprise 13

The Power of Demand Planning Demand planning: a Tool That Supports the Process | Building the Effective Enterprise

The Power of Demand Planning Part of a planning suite Strategic Demand Distribution Production Procurement | Building the Effective Enterprise

The Power of Demand Planning Powerful Calculations ■ Clean data ■ Use controlled, stable and powerful forecast calculation ■ Use life cycle information ■ Monitor reliability ■ Propose safety stocks | Building the Effective Enterprise

The Power of Demand Planning Powerful Process Support Import Collaborative review Lifecycle | Building the Effective Enterprise Clean Calculate 17

The Power of Demand Planning Import Data ■ Integrated with QAD EA § Standard connector § Direct access to DB ■ Check integrity § missing attributes § Missing units of measure | Building the Effective Enterprise 18

The Power of Demand Planning Past Sales Analysis ■ Outlier detection ■ Assisted correction ■ Deviation alerts | Building the Effective Enterprise 19

The Power of Demand Planning Forecast Calculation ■ Statistical methods ■ Top-down approach ■ Seasonality management | Building the Effective Enterprise 20

The Power of Demand Planning Lifecycle Management ■ Phase out ■ Phase in process ■ Item supersession | Building the Effective Enterprise 21

The Power of Demand Planning Collaborative Review ■ ■ Actors enter their own opinion On the fly aggregations Final word to planner Review divergent opinions | Building the Effective Enterprise 22

The Power of Demand Planning Weekly Process ■ Review last weeks alerts ■ Enter promotions ■ Validate / change weekly forecast | Building the Effective Enterprise 23

The Power of Demand Planning Metrics ■ Forecast reliability analysis ■ Safety stock calculation ■ ABC calculation | Building the Effective Enterprise 24

The Power of Demand Planning Summary ■ ■ Huge impact of demand planning Complex process Powerful software Quick return on investment | Building the Effective Enterprise 25

The Power of Demand Planning Next Steps While at Explore ■ Watch session replay: § Building a supply chain for the future ■ Attend related session: § Customer Stories about the Benefits of QAD Demand Planning ■ Stop by the Solutions Expo ■ Visit our web site | Building the Effective Enterprise 26

The Power of Demand Planning Questions & Answers ■ Presenter Name: c 4 h@qad. com | Building the Effective Enterprise 27

www. qad. com www. dys. com ©QAD Inc. 2013 | Building the Effective Enterprise 28