Demand Planning Needs Customer Profi tability

This column deals with supporting demand-shaping and planning decisions that are the responsibilities of Marketing and Sales departments. Managers in these departments are typically goaled to maximize revenue and market share. This often leads them to make decisions in isolation of Supply Chain and profi tability considerations. To help them move towards “demand planning with profi tability in mind,” companies need to track customerlevel profi tability, not easily gotten from standard accounting systems. A True Customer Profi tability Model is proposed that could help them do this. LARRY LAPIDe | Dr. Lapide is a Lecturer at the University of Massachusetts, Boston and an MIT Research Affi liate. He has extensive experience in industry, consulting, business research, and academia as well as a broad range of forecasting, planning, and supply chain experiences. He was an industry forecaster for many years, led supply chain consulting projects for clients across a variety of industries, and has researched supply chain and forecasting software as an analyst. He is the recipient of the inaugural Lifetime Achievement in Business Forecasting & Planning Award from the IBF. He welcomes ...