Demand Management
Order Instructions:
For this paper, they are 4 main sections to respond to, the writer must clearly respond to this four main point in the paper, using pear review articles from the resources and the internet to support every respond. APA 6th Edition must be implore through out the entire paper.
Looking into the future is a conundrum: it is both necessary and impossible to do with complete accuracy. From knowing what the weather will be like tomorrow to trying to decide what the stock market will do, forecasting is an activity that consumes a considerable amount of our attention because it impacts our lives so directly.
How important is forecasting to planning and decision making for a business?
Analyze the various techniques of forecasting and explain which would be appropriate or inappropriate to
(a) a manufacturing enterprise, and
(b) a service provider.
Conclude your paper by identifying a model of demand management that would be well-suited to the retail food industry.
Resources
Course Text
• Handbook of Global Supply Chain Management
Chapter 5, “Demand Management”
This chapter examines the implications of independent and derived demand, analyzes a model for demand management function in GSCM, as well as the role of sales forecasting management within demand management.
Articles
• Mentzer, J. T., & Moon, M. A. (2004). Understanding demand. Supply Chain Management Review, 8(4). Retrieved from ABI/INFORM Global database.
This article looks at the three types of demand and shows how forecasting contributes to the sales and operations planning process.
• Taylor, D. H. (2006). Demand management in agri-food supply chains: An analysis of the characteristics and problems and a framework for improvement. International Journal of Logistics Management, 17(2). Retrieved from ABI/INFORM Global database.
This article presents examples and specific data from six value chain analysis case studies examining demand management in the UK food supply chain.
• Lapide, L. (2006). Demand management revisited. Journal of Business Forecasting, 25(3). Retrieved from ABI/INFORM Global database.
This short article considers the importance of demand management and the role played by demand forecasting in supporting the cost-benefit and profitability analyses needed to make optimized customer-service setting decisions.
• IBM Corporation. (2006). Demand Management: The Next Generation of Forecasting. Retrieved from
http://www-935.ibm.com/services/us/gbs/bus/pdf/g510-6014-demand-management.pdf
This link directs you to a white paper on demand management.
• Gung, R. R., Leung, Y. T., Lin, G. Y., & Tsai, R. Y. (2002, December). Demand Forecasting TODAY. Retrieved from http://www.orms-today.org/orms-12-02/frdemandforecasting.html
This link directs you to an article that discusses demand forecasting in the context of predicting future demand for products of a business organization while focusing on products of the physical type, as opposed to services.
• Dey, R. & Somani, J. P. (n.d). Re-thinking Demand Management. Retrieved from http://www.sdcexec.com/article/10289643/re-thinking-demand-management
This link directs you to an article about managing customer demand in uncertain times.
Barve, A. (2002, September 24). Lessons in Demand Management. Retrieved from
http://scm.ncsu.edu/scm-articles/article/lessons-in-demand-management
SAMPLE ANSWER
Demand Management
Introduction
a.) Forecasting is critical to planning and also in decision making process in a company besides the financial budgetary demands. The advancement in technology and digital business operations has resulted in more challenges to demand forecasting. Orders and quotations are increasing using the e-business technology where most of the transactions are paperless and time spent per transaction is reducing to a matter of minutes. The fierce and competitive business environment has culminated into the critical need for prompt information that is constantly reviewed and updated to reflect the changes in the business environment. Buyers expect to find the product they want on the shelves when they need it or exactly when they will be available otherwise they will definitely walk to the next shop where the product is available (Dey & Somani, n.d). The importance of forecasting is to ensure that products are available throughout the business period and at the quantities required by the customers. Forecasting also assists in financial planning where budgetary allocations are made. The forecasts also help in calculation of lead times and the reorder levels that may require adequate financial resources. Forecasting helps the management to forecast when the company may need funding to facilitate its business operations and processes. The forecasts assist in decision making process as they determine when the company may need funding.
- b) There are various techniques that are applied in forecasting. Currently, there are various types of commercial forecasting software that are available in the market some of which are based on stand-alone systems, specialize packages and other types that are applicable to modules on management systems. The other ones like just-in-time processes are applicable to manufacturing industries. Time based and quick response strategies are applied also in the manufacturing sector (Gung, Leung, Lin & Tsai, 2002). The most widely used forecasting techniques however are based on historical information on demand. But they have proved to be unreliable where the future demand is difficult to predict basing the outcome on the past sales trends which are susceptible to sudden market changes.
- c) A manufacturing firm would adopt the just-in-time forecasting technique which is based on the past historical perforce of the firm (Lapide, 2006). Most of the sales from manufacturing plants are mostly consistent and the forecasting method can be applied as changes are not erratic or far apart.
- d) A service provider requires a forecasting system that’s more proactive and which is more sophisticated and relies on quantitative analytics to predict future demands. Service providers mostly have loyal customers and whose demand can be easily forecasted based on the past performance and historical records. However, sophisticated realtime forecasting packages can also be utilized to forecast the demand more accurately (IBM Corporation, 2006).
To conclude, the best model for a demand management that would be suitable to a retail food industry is one that is web based and which provides reliability, scalability and which supports functionality with other realtime feedback systems that are systematically designed to dynamically forecast against such variables like customer orders, inventory, supply and the financial objectives of the firm (Barve, 2002). Realtime processing is critical to a retail food industry because of the nature of the food industry that requires fresh orders and shorter lead times.
Reference
Barve, A. (2002, September 24). Lessons in Demand Management. Retrieved from
http://scm.ncsu.edu/scm-articles/article/lessons-in-demand-management
Dey, R. & Somani, J. P. (n.d). Re-thinking Demand Management. Retrieved from http://www.sdcexec.com/article/10289643/re-thinking-demand-management
Gung, R. R., Leung, Y. T., Lin, G. Y., & Tsai, R. Y. (2002, December). Demand Forecasting TODAY. Retrieved from http://www.orms-today.org/orms-12-02/frdemandforecasting.html
IBM Corporation. (2006). Demand Management: The Next Generation of Forecasting. Retrieved from http://www-935.ibm.com/services/us/gbs/bus/pdf/g510-6014-demand-management.pdf
Lapide, L. (2006). Demand management revisited. Journal of Business Forecasting, 25(3). Retrieved from ABI/INFORM Global database.
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