There is an old expression that is ubiquitous in human activities that involve the use of input data to create actionable information. That expression is: ‘Garbage In, Garbage Out’. The same axiom applies to time-series forecasting. Time-series forecasting is a technique which is predicated upon the tenet that a mathematical model which fits the pattern…
Arguably, SKUs with Intermittent Demand are some of the most challenging to forecast with any modicum of accuracy. We generally define Intermittent Demand as follows: Intermittent series has demand appear at random with many time periods showing no demand at all. The prominent characteristics of such series are: The time-series contains embedded zeroes The time-series…
As a consequence of being in a forecasting consultancy we have picked up an in-depth understanding of the planning and forecasting functions of the firms. One conclusion we have drawn is that irrespective of distribution, dimension or division, most firms have similar struggles from similar function weaknesses. What we also noticed is that for demand…
Regression is one of the highly spoken about quantitiative methods in forecasting. It is a statistical method of identifying relationship between two or more variables (one dependent variable and others independent variables). If these two variables have a strong relationship then we leverage this relationship to use the knowledge of the independent variable to predict…
How to Analyse Variations in Forecast vs. Actuals to Improve Forecasts. The job of demand planners is not over by generating forecast numbers. In order to assist the planning process team and correct the forecast it is best to have exception reports in place. It is important to find the anomalies in the data and create…
Business planning & forecasting as a subject and function makes for an interesting discussion on its importance. With availability of data and technology the function is now making its presence felt in the increasingly competitive business world. However, this is not without its set of resistances specially from the traditional thought process. In this write…
Today, most companies involve themselves with a wide range of products. Competitive compulsions force companies to keep the product range fresh and relevant in the marketplace and hence introduce new products in high frequency than ever before. However, from the planning perspective, forecasting demand for the new products is one of the biggest challenges for…
Of late we noticed something strange in some of the big companies that we are working with and we guess they found something strange about our observations. The demand planner in all of these companies was working directly at SKU level and nothing above it. This means that if the company has 10,000 SKUs, the…
The demand planner holds the unique position in the organization’s value chain. With improved product forecasting via effective collaborative management she is able to assist all value chain processes work more smoothly and efficiently. As you can see from the foregoing, we have placed the demand planner as the lynchpin of the PRIMARY ACTIVITIES of…
Notes from the round table discussion on S&OP and Collaboration at the IBF Conference, Dubai in April 2016 It is very apparent that the success of the S&OP process lies with the support of the management as was the feedback from every one. No amount of noble intention from the planning team can make it…
