Big Ass Fans Turns to Smart Software as Demand Heats Up
Big Ass Fans is the best-selling big fan manufacturer in the world, delivering comfort to spaces where comfort seems impossible. BAF had a problem: how to reliably plan production to meet demand. BAF was experiencing a gap between bookings forecasts vs. shipments, and this was impacting revenue and customer satisfaction. BAF turned to Smart Software for help.
BAF’s Supply Chain Manager took the lead to flesh out their planning needs and methodically address them. In his words, “it came down to fundamentals. Our planning process needed to be data driven, collaborative, and continually improved by assessing and enhancing our monthly forecasting process.”
A big part of this was bringing the disparate planning processes together. Product managers produce monthly demand forecasts, while the operations team forecasts shipments and associated material requirements. BAF needed a tighter, data-driven process that combines advanced analytics with team collaboration. This would need to address seasonality, a huge factor driving demand fluctuations, incorporate input from international as well as US markets, and capture the impact of market promotions.
BAF’s Customer Service Director and S&OP Team Lead explained what this means. “Now we have one unified, global process, one shared business view that provides the framework for all of our cross-business planning.” She likens it to having one source for the truth. “Every month the entire team sees updated orders and shipments and can compare forecast against actual performance. Individual managers view business through their required business lens – by product line or service, region, international geography, channel, customer, you name it.”
“This is enabling technology that makes us better,” she continued. “Smart IP&O is, among other things, the vehicle for our monthly SIOP process. We review our own business segments then convene as a group, consider results to date, the impact of promotions, events and seasonality, and agree on our consensus plan going forward. This is an invaluable process, enabling manufacturing to stay ahead of demand and deliver what our customers need, when they need it.”
“Smart Inventory Planning & Optimization is the critical tool we use to manage our forecasts across a large and dynamic set of Products/Parts, multi-national sites, and complex supply chains,” added the Supply Chain Manager. “The ability of the software to provide a statistical forecast as baseline, allow adjustments by various subject matter experts, each recorded as ‘snapshots’ for consensus building and later use in accuracy/improvement efforts, then ultimately feed the forecast data directly into our Material Requirements Planning software is central to our S&OP process.”
BAF has refined its monthly Sales, Inventory and Operations Planning process utilizing Smart Demand Planner, Smart’s collaborative forecasting and demand planning application. Smart’s API based bi-directional integration with BAF’s Epicor Kinetic ERP automatically captures all order and shipment data that in turn drives the creation of monthly statistical forecasts. Through its monthly SIOP process, BAF product managers produce initial forecasts, share these with sales managers who can suggest adjustments, and bring together consensus plans across 25 product lines for monthly review, adjustment, and presentation to the executive team as the company’s rolling 12-month plan.
The team credits Smart Demand Planner with providing a thorough and accurate forecast of future demand that is central to BAF’s monthly SIOP process. BAF extended Smart’s utilization to its international offices, where subject matter experts manage their own forecasts. “Within Smart they can manage both demand forecasts that key on their shipments to local end users and supply forecasts based on their purchase history as key customers to BAF-US. This significantly enhances our global demand view and has improved forecast accuracy.”
About Smart Software:
Founded in 1981, Smart Software, Inc. is a leader in providing businesses with enterprise-wide demand forecasting, planning, and inventory optimization solutions. Smart Software’s demand forecasting and inventory optimization solutions have helped thousands of users worldwide, including customers such as Disney, Arizona Public Service, and Ameren. Smart’s Inventory Planning & Optimization Platform, Smart IP&O, provides demand planners the tools to handle sales seasonality, promotions, new and aging products, multi-dimensional hierarchies, and intermittently demanded service parts and capital goods items. It also provides inventory managers with accurate estimates of the optimal inventory and safety stock required to meet future orders and achieve desired service levels. Smart Software is headquartered in Belmont, Massachusetts. Learn more at www.smartcorp.com.
About Big Ass Fans
At Big Ass Fans, we are driven by our mission to create safer, healthier, more productive environments worldwide. What started as a big idea in airflow became a revolution and is now best practice for designers, managers, and business owners across every imaginable industry and application. Today, our products are proudly spinning and serving more than 80 percent of the Fortune 500 in 175 countries. From factories to homes and everywhere in between, Big Ass Fans delivers comfort, style, and energy savings to make life more enjoyable. With more than 235 awards, 350 patents, an experiment on the International Space Station and the only HVLS Research & Design lab in the world, we go big every day.
Procon Pumps Uses Smart Demand Planner to Keep Business Flowing
Introduction:
Procon, an industry leading pump manufacturer, uses Smart IP&O’s demand planning and inventory optimization modules from Smart Software to make sure they have the products their customers need, when they need them. You might not have heard of their products, but if you’ve ever eaten at McDonalds or sipped a coffee at Starbucks, you have been served by Procon. Procon’s broad portfolio of over 7,000 SKUs is supplied to more than 70 countries worldwide through their direct sales channel and an extensive distributor network. Procon operates manufacturing facilities in the US, Mexico, Ireland, and through a licensed manufacturing partner in Japan. We spoke with Procon’s Shankar Suman, Director of Sales, and Emer Horan, Global Supply Chain Manager, to learn more.
The Challenge
If Procon cannot ship a required product, their customers cannot ship theirs. Accurate forecasting is a key driver of supply chain success and customer satisfaction. Procon’s monthly planning establishes the consensus demand plan that drives procurement, production, and stocking policies. But they found they had a gap between sales and procurement, which historically led to missed deliveries and excess inventory. What Procon needed was a robust demand forecasting and inventory optimization tool that was easy to use, enabled collaborative planning with their sales team and partners, and integrated with their ERP system to drive procurement and production planning.
The Solution:
They found this in Smart IP&O, web-based platform for statistical forecasting, demand planning, and inventory optimization.
- Shankar Suman cited a broad mix of capabilities that convinced them to utilize Smart. Chief among them were:
- Smart Demand Planner supports the easy, orchestrated flow of information that yields an accurate consensus plan. Presenting performance history and statistical forecast by product, territory, and partner, SDP provide the sales team with perspective that they can complement – adjusting for expected opportunities or demand shifts.
- Forecast accuracy. Smart is an industry leader in statistical analytics, leveraging innovations developed over its forty-plus year history. This combined with robust forecast vs. actuals analysis helps Procon continually improve the quality of their forecasts.
- Transparent connectivity with Procon’s enterprise software, Epicor Kinetic. Daily sales and shipment data are automatically pulled into the Smart platform, fueling Smart’s forecasting engine, and results are easily pushed back to the ERP (MRP) via an API based integration to drive ordering and production planning.
Results:
Emer Horan explained how this plays out over the course of each month. Emer provides forecasts for each of their five sales managers, they meet to compare statistical and sales forecasts, and agree on a revised 12-month consensus plan. The sales managers have a good sense for the top accounts that represent 80% of revenue, often including direct input from customers themselves, and the statistical forecast fills in the gaps. Next month they use the forecast vs. actual analytics to help improve accuracy, then repeat the process.
“Our sales team is incentivized to maintain and improve sales forecast accuracy,” said Emer, “and we have the tools to help them succeed. This not only ensures optimal inventory levels but also contributes to improved on-time delivery and higher customer satisfaction.”
“Our journey with Smart Software has been quite remarkable,” added Shankar. “We began with an initial idea of the functionality and interface, and it has continually evolved from there. The Smart team has shown tremendous support and patience with our scope changes, delivering the product exactly the way we needed and wanted it. We have been using Smart for over three years now, and this journey is ongoing. We continue to receive excellent support from the Smart team and truly enjoy working with them.”
Beyond the forecast – Collaboration and Consensus Planning
5 Steps to Consensus Demand Planning
The whole point of demand forecasting is to establish the best possible view of future demand. This requires that we draw upon the best data and inputs we can get, leverage statistics to capture underlying patterns, put our heads together to apply overrides based on business knowledge, and agree on a consensus demand plan that serves as cornerstone to the company’s overall demand plan.
Step 1: Develop an accurate demand signal. What constitutes demand? Consider how your organization defines demand – say, confirmed sales orders net of cancellations or shipment data adjusted to remove the impact of historical stockouts – and use this consistently. This is your measure of what the market is requesting you to deliver. Don’t confuse this with your ability to deliver – that should be reflected in the revenue plan.
Step 2: Generate a statistical forecast. Plan for thousands of items, using a proven forecasting application that automatically pulls in your data and reliably produces accurate forecasts for all of your items. Review the first pass of your forecast, then make adjustments. A strike or train wreck may have interrupted shipping last month – don’t let that wag your forecast. Adjust for these and reforecast. Do the best you can, then invite others to weigh in.
Step 3: Bring on the experts. Product line managers, sales leaders, key distribution partners know their markets. Share your forecast with them. Smart uses the concept of a “Snapshot” to share a facsimile of your forecast – at any level, for any product line – with people who may know better. There could be an enormous order that hasn’t hit the pipeline, or a channel partner is about to run their annual promotion. Give them an easy way to take their portion of the forecast and change it. Drag this month up, that one down …
Step 4: Measure Accuracy and Forecast Value Add. Some of your contributors may be right on the money, other tend to be biased high or low. Use forecast vs. actuals reporting and measure forecast value add analysis to measure forecast errors and whether changes to the forecast are hurting or helping. By informing the process with this information, your company will improve it’s ability to forecast more accurately.
Step 5: Agree on the Consensus Forecast. You can do this one product line or geography at a time, or business by business. Convene the team, graphically stack up their inputs, review past accuracy performance, discuss their reasons for increasing or reducing the forecast, and agree on whose inputs to use. This becomes your consensus plan. Finalize the plan and send it off – upload forecasts to MRP, send to finance and manufacturing. You have just kicked off your Sales, Inventory and Operational Planning process.
You can do this. And we can help. If you have any questions about collaborative demand planning please reply to this blog, we will follow up.
Supply and Demand Chain Executive: Optimizing Parts Management at BC Transit.
Belmont, Mass., May 14, 2020 – Smart Software, Inc., provider of industry-leading demand forecasting, planning, and inventory optimization solutions, today announced that Supply and Demand Chain Executive 2020 Online Magazine features an article about inventory optimization at BC Transit, entitled “Optimizing Parts Management at BC Transit.” Eric Nelson, Director for Supply Services at BC Transit explains how Smart IP&O has helped ensure that they have the right part in the right place at the right time to equip their entire service network with 35 repair locations. “Smart IP&O has enabled us to utilize service level as a driving KPI,” states Nelson, “essentially risk adjusting our inventory to address the criticality of not running out, and to deal with the thorny challenges of seasonal and intermittent demand. It is helping us keep our buses on the road, so we can be the best transportation solution for our partners across British Columbia.”
To read the entire article and to learn more about Optimizing Parts Planning please visit https://www.sdcexec.com/warehousing/article/21130834/optimizing-parts-management-at-bc-transit
About Smart Software, Inc.
Founded in 1981, Smart Software, Inc. is a leader in providing businesses with enterprise-wide demand forecasting, planning and inventory optimization solutions. Smart Software’s demand forecasting and inventory optimization solutions have helped thousands of users worldwide, including customers at mid-market enterprises and Fortune 500 companies, such as Disney, FedEx, MARS, and The Home Depot. Smart Inventory Planning & Optimization gives demand planners the tools to handle sales seasonality, promotions, new and aging products, multi-dimensional hierarchies, and intermittently demanded service parts and capital goods items. It also provides inventory managers with accurate estimates of the optimal inventory and safety stock required to meet future orders and achieve desired service levels. Smart Software is headquartered in Belmont, Massachusetts and can be found on the World Wide Web at www.smartcorp.com.
For more information, please contact Smart Software, Inc., Four Hill Road, Belmont, MA 02478.
Phone: 1-800-SMART-99 (800-762-7899); FAX: 1-617-489-2748; E-mail: info@smartcorp.com
“Are you a Victim of your Forecast Models” by Smart Software Co-Founder Profiled in 53rd issue of Foresight
Belmont, Mass., March 28, 2019 – Smart Software, Inc., provider of industry-leading demand forecasting, planning, and inventory optimization solutions, today announced that the Spring 2019 issue of Foresight Magazine features Dr. Thomas Willemain’s article “Are you a Victim of your Forecast Models.” Len Tashman, Editor of Foresight states: “Here Tom Willemain, a longtime contributor to the journal, ponders why modeling and optimization algorithms haven’t displaced “gut instinct” in supply-chain forecasting as much as one would expect, given their penetration in kindred fields such as finance. It’s not that we can always trust models —far from it—but, as Tom puts it, What makes gut instinct dangerous is that it is so amorphous. Everyone who works a long time in a job develops instincts, but longevity is not the same as wisdom. It is possible to learn all the wrong lessons. Tom then provides a capsule summary of the advantages of modeling, but with the caveat that model error is a constant risk that requires monitoring and careful checking of its assumptions.
To read the entire article and to learn more about Foresight please visit https://foresight.forecasters.org/
About Smart Software, Inc.
Founded in 1981, Smart Software, Inc. is a leader in providing businesses with enterprise-wide demand forecasting, planning and inventory optimization solutions. Smart Software’s demand forecasting and inventory optimization solutions have helped thousands of users worldwide, including customers at mid-market enterprises and Fortune 500 companies, such as Disney, FedEx, MARS, and The Home Depot. Smart Inventory Planning & Optimization gives demand planners the tools to handle sales seasonality, promotions, new and aging products, multi-dimensional hierarchies, and intermittently demanded service parts and capital goods items. It also provides inventory managers with accurate estimates of the optimal inventory and safety stock required to meet future orders and achieve desired service levels. Smart Software is headquartered in Belmont, Massachusetts and can be found on the World Wide Web at www.smartcorp.com.
For more information, please contact Smart Software, Inc., Four Hill Road, Belmont, MA 02478.
Phone: 1-800-SMART-99 (800-762-7899); FAX: 1-617-489-2748; E-mail: info@smartcorp.com
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