Demand Visibility improves Demand Forecasts

DEMAND VISIBILITY IMPROVES DEMAND FORECASTS By Jared Schrieber Describes why it is difficult to improve demand visibility and what can be done about it … the more visible the demand, the better will be the forecast … offers a four step approach to transform disparate demand signals into a competitive weapon. Businesses rely on forecasts, whether formal or informal, for almost every important decision. Predictions related to revenue, unit demand, capacity requirements, material prices, competitor actions and customer behaviors all drive corporate planning. A single demand forecast may influence more critical decisions throughout a company than any other piece of information. Sales quotas, marketing budgets, capital expenditures, production schedules, hiring and procurement contracts are just a sampling of the decisions that may rely upon a single demand forecast. Given the importance of forecasting, it is not surprising to learn that a recent survey of nearly 250 senior financial executives reported that forecasting demand was by far the most critical problem within their companies’ supply chains. Regardless of the amount of resources deployed in predicting the future, there ...