In one of my previous posts, I wrote about using coefficient of variation (CV) as a predictor of forecastability. In this post, I will talk about how it can be used to indicate a sensitivity of lead time towards the safety stock calculations. To quickly remind the reader first: The formula for CV = StdDev
Planning is an art. All planners deal with the daily firefighting while also looking into the future and cautiously calculating possible steps to combat all sorts of scenarios. But how do you plan for scenarios when you are new to a company? Every business is different and while there’s always demand and supply, the devil
In preparation for the Supply Chain Insights Global Summit, Lora Cecere spoke with Sujit Singh, Chief Operating Officer of Arkieva, in an episode of Straight Talk with Supply Chain Insights. With two to three podcast a week, Straight Talk is designed to benefit the supply chain leader that is on the go and wants to be
I recently watched a TED talk video by Alison Ledgerwood on YouTube. In the video, Alison gives the example of her paper getting accepted for publication (positive news) and another one getting rejected for publication (negative news). She talks about how it takes longer to recover from (i.e., go back to being her normal self) a
In preparation for the Supply Chain Insights Global Summit, Lora Cecere spoke with Bram Desmet, Managing Director of Arkieva’s Channel Partner Solventure, in an episode of Straight Talk with Supply Chain Insights The Straight Talk podcasts are designed to benefit the supply chain leader that is on the go and wants to be in the
Sales and Operations Planning (S&OP) is typically a monthly process. Through a series of detailed planning steps, and usually three meetings, companies define a plan to deal with what they think they can do to meet the demand given their supply and other constraints.
Key Point: A Sales and Operation Planning (S&OP) meeting is a meeting to design the future course of a business. Yet, too many companies spend too much time talking about the past or the current period. I recommend using about 60-70% of the time discussing the future. The (S&OP) process consists of a lot of
Key Point: Coefficient of Variation is not a perfect measure of forecastability. However, if used properly, it can add value to a business’s forecasting process. In the world of forecasting, one of the key questions to consider is the forecastability of a particular set of data. For example, a salesman might consistently be better at
In the simplest inventory situation, the only variability is in the quantity of demand for a single day. There is no trend up or down or seasonal effect. The demand today is independent of the demand for tomorrow. Additionally, we will assume replenishment time is zero. That is when we place an order for additional
You have a favorite forecast accuracy metric(s) you’ve been practicing within the organization for a while, and now you think you are ready to bring it to the Sales and Operations Planning (S&OP) meeting as a Key Performance Indicator (KPI) of your demand planning process. But you are not sure exactly how to go about