In another article on demand planning, my colleague Dharmendra Patwardhan summarized the effects on the supply chain of the growth of the digital economy. He said it was enabling increased competition, and that it was also creating a demand for increased flexibility.
I’d like to expand a little on that point. Take Master Data Management (MDM), for example. According to Forbes, 90% of the digital data that exists worldwide today was created within the last two years. This wealth of data is creating significant challenges – not just at a macro level, but at a granular level, too.
How so? Partly, it’s because the digital world is transforming customers’ lives, and not just transforming business. People have higher expectations. They’re growing accustomed to calling the shots: if someone doesn’t make that baseball cap in orange, they’ll find someone else who can.
MDM systems need to accommodate the data that flows from customization of this kind; and this, in turn, has implications for the supply chain. When you’re addressing the “segment of one,” demand planning assumes even greater importance. It ceases to be merely a fulfilment function, and becomes a growth enabler – which is why, now more than ever, the role of demand planner is so vital, and is evolving so rapidly.
The new norm
The issues with which demand planners have to deal are manyfold. For instance, in some cases, they are trying to meet these increasing demands for customization while they’re still tied to inflexible legacy planning technology.
Another issue demand planners must address is that in the past, exception handling was prioritized in favor of the most frequent occurrences – but today’s trend towards customization is a great leveler. When many customers want their baseball caps not just in orange, but in powder blue, lime green, and hot pink – and when the ecosystem is subject to extreme weather, unpredictable political situations, embargos, transportation challenges – exceptions become the new norm, and demand planning systems need to accommodate this equably and in real time.
A further consideration is that increasing demands for volume and variety are intensifying the need for low-touch or no-touch demand fulfilment. Legacy systems can’t provide the levels of automation needed. Nor can they cope with the shorter planning cycles, requirement adjustments, and increased workflow.
In short, planning requirements today have significantly developed, and yet the circumstances in which planners are working, because of the technology they’re obliged to use, can make it difficult for them to abide by their organization’s own rules of governance.
This is where an experienced and global service provider can make a significant difference. They are already up to speed in technological developments such as big data, analytics, in-memory computing, the cloud, collaborative tools, AI, and the Internet of Things. This means they can introduce productive solutions to organizations faster than they can implement them themselves, helping them to reshape their demand planning function.
As a result of growing demands and evolving technologies, the role of demand planners also looks set to change. They will be able to be more strategic and less transactional, because many of the operational functions for which they were previously responsible can now be automated. They will occupy less of a support role, and will increasingly be seen as a partner to the business, working in real time and collaboratively with other disciplines in the organization, with production and planning systems, with newly emerging automated and AI solutions, and of course ultimately also with customers.
Learn more about how Capgemini’s Demand Planning offering puts your customers at the very center of our solution, opening your channels to new, innovative business models that can lead to increased revenue, profitability, and working capital, as well as enhanced customer satisfaction.
To learn more about how Capgemini’s Digital Supply Chain Practice can increase your competitive advantage by strengthening your business drivers and focusing on your end customers, contact: firstname.lastname@example.org
Jörg Junghanns leverages innovation and a strategic and service mindset to help clients transform their supply chain operations into a growth enabler.