Forecasting and managing uncertain demand
An accurate forecast is a critical supply chain driver but many organizations have a limited view of what comes next. Forecasts developed by sales and customers are often inaccurate and biased reflecting sales goals or budgets. Forecasts are provided at aggregate levels leaving the supply chain to determine which items will be demanded at which locations. Planning teams are left to interpret sales figures and covert them into actionable forecasts of the item mix. This process is often managed in complex spreadsheets that are difficult to use, share, scale, and don’t account for inherent patterns in the item demand such as seasonality and trend.
By starting off with the best possible forecast, the organization has the opportunity to have the right product in the right place in the right quantity so that demand can be met with minimal inventory. Smart Software offers SmartForecasts for developing the best possible statistical forecast that account for trends, seasonality, promotion/event driven demand and more. The baseline forecast serves as the starting point. Once the baseline is produced it is available for collaborative review and consensus planning. Overrides can be applied, reviewed, compared to the baseline and approved by authorized users. Forecast accuracy can be measured ensuring the best possible forecast is delivered to the business at both the aggregate and item mix levels.