Enhance your sales lifecycle management for logistics with airSlate SignNow

How to create outlook signature

welcome back everyone I am Professor Rodriguez and you guessed it I am back with another lesson on supply chain in logistics and that's what I do here in the channel I teach you the basics of the foundations of Supply Chain management Logistics and basically everything to do with that in a way that's easy to digest and also I bring you Career Development advice that's easy to implement now in today's lesson we're going to talk about lesson number eight and that is the man planning or what is demand planning if you've been watching this series The Learning Logistics series you know that we progress on sort of the topics that are building the foundation from what is supply chain and we're building up to those bigger Concepts and the area of Supply Chain management so that's we're going to talk about today the man planning I hope you have been watching the videos and I hope you enjoy this one so let's get right to it I also want to let you know that I am offering a free master class on supply chain Career Development where I help students and professionals like you figure out what their Ideal Supply Chain career can look like and how to actually get there I talk a little bit about what is Supply Chain management some sort of the foundations on that but I do focus more on what are some career paths that you can find in supply chain what are some of the skills and some of the competencies you'll need for a career in supply chain as well as to give you some professional development stories about myself and some of the students that have previously taken this class and have been coached by me in that area in this master class you get to chat one-on-one with me live on a zoom call in one of our supply chain career development master class sessions I will have all the links in the description down below what the times and the dates for the upcoming session we had a lot of great feedback on the last one I really hope you can join so if you're interested on that and to chat 101 with me in a live Sim call for the master class then I will put the description and the information and the links down below and somewhere here in the cards as well so we'll try to do that all right so without further Ado let's get into lesson number eight demand planning in today's lesson we're going to focus on demand planning which is a progression of the topics that we've been talking about within the bigger bubble of supply chain and Supply Chain management as I mentioned earlier I have made a video on demand planning previously and this was earlier when the channel was getting started and I'm going to add them in the links somewhere in the card somewhere um and you could always check that video out but in this video I'm trying to take an approach that is a little bit easier to to learn and to understand about what is demand planning and sort of update it for 2023 giving you some examples that apply into today's environment as well first up we're going to start with the definition so we have to understand what is a demand planning demand planning really is a very crucial aspect of Supply Chain management as a as a bigger picture or as a whole and that really within the man planning what it really involves it's predicting consumer demand for the products and services and that our business offers Now by accurately forecasting demand businesses can really optimize their inventory levels and they can reduce waste and they can improve their bottom line when they plan for their demand and their levels of demand now in this lesson I'm gonna take you through what's the importance of demand planning I'm going to highlight some examples of some companies that have implemented some effective demand planning and strategies and what those are strategies look like all right at its core the man planning is about accurately forecasting consumer demand for products and services now this involves analyzing past sales data analyzing market trends and it also involves getting some customers feedback to identify some patterns and so we can anticipate future demand by forecasting demand businesses as I mentioned can really ensure that they have the right inventory levels you know that they can really meet the customers needs without having issues of buying too much inventory or over stocking or not getting enough inventory or under stacking or having stockouts or at least that is the the goals for companies within demand planning and why it is so crucial for people within supply chain we really want to know what is or what can we expect the future demand for our products to be and how can we plan ingly to that because if if we don't take this as one of the first or the earlier steps within supply chain then we're really sort of going in the blind we're not having a plan as far as how much we need to produce of something so that we can actually meet the demand and not lose money in the process think of yourself going back to your early days of having to you know do a candy sale or a lemonade stand sale you really needed to know how many lemons am I going to have to buy how much candy am I going to have to get is it going to be enough for the demand am I not going to have or am I going to have too much at the very early stages and when you're just starting out your business it might be tricky to do that and you're not you might not have those sort of factors like I mentioned past sales data you might not have access to that because you're still just opening your business or you you're you know you don't have a good idea of what you're doing in the business yeah you don't have any sales numbers what you do in those sort of cases is use other types of data you use data within the industry that you're going to see well if you wanted to sell lemonade and this is your first time doing it how about you ask your neighbors if any of the other people around the block had sold lemonade before and see what their numbers on their sales were you can ask them what was the best time of the year to sell lemonade you know what that they usually have as far as clientele for the lemonade stand so you can see how in basic terms we have to sort of figure out a way to know ahead of time how much of one item one product or how many how much of a service we're actually going to need before we actually set our plan and motion of selling something so it makes a lot of sense once you look at it from their perspective and it's just as I mentioned to you time and time again that supply chain is really about planning and having a plan ahead of time or having a plan before we actually set anything else in motion intimate planning we want to forecast what does it mean by forecast I've mentioned this already in previous lessons forecast is sort of trying to predict trying to foresee the future we're fortune tellers here or foresee the future in a way that we can Implement that into our production on schedules into our manufacturing schedules into our distribution processes and I'm going to take you through those as we progress through the lesson today but that will be the foundation of it demand planning really is about foreseen forecasting predicting how much demand the consumer will have for our products in simple terms the man planning is the process of predicting how much of a product or service the customer will want in the future this will help a business prepare by making sure that they have enough inventory on hand to meet customer needs without over stocking or buying too much inventory or without under stocking which means not having enough inventory which is also sometimes known as a stock out the man planning involves using historical data using market trends and other resources of information to make a forecast of future demand we call this type of information we call it quantitative data and qualitative data quantitative data is really the historical numbers the sales data the numbers in this sort of equation for demand planning the qualitative data is stuff that you would go out to an expert and have an expert's advice in the field or in the industry try to help us figure out what the demand for the product will be in the future the companies that do it best they should sort of use a um a mix of the two they use quantitative data as well as qualitative data meaning we use the historical the sales numbers and we also look at what the experts are saying what are some of the trends that we see out there where do we see like the experts in the industry telling us that the market is going to next that's what we mean by that so we combine sort of the two and then we make the best educated guests for our companies as far as what the demand for the product will be within a particular time frame now as you can see sort of in this teeter-totter seesaw kind of situation um we really want to do is balance two things within the main flight and the goal here would be to ensure that the business is prepared to meet the customers needs but also avoiding situations where you run out of stock or you have too much stock to sell it is really a balancing act between having enough demand and one end and also having too much product on the other end the demand planning and people that work in this area or in this particular department or or section of supply chain will tell you really is a balancing act you never want to run out of product where the customer is placing an order and you don't have enough to fulfill that order and then on the opposite end you don't want to buy too much of a particular material or good or or make too much that the product is foil the product could be damaged or the product could run its lifetime and that you might not be able to sell it for a profit and that's also the difficulty in it so so yeah we we have this sort of balancing act and demand planning and people that work they will tell you that is everything's about a very subtle balance between getting too much inventory where you're not going to sell all of it or not having enough inventory where a customer comes in and places an order okay and there's so many factors we just saw within pandemic when when stuff hit and closures were coming down and lockdowns were happening that sort of balance in the main planning really really shifted there was not enough demand for certain goods and items because we were going into lockdowns and people were staying at home they weren't having to go out into the road anymore they weren't able to travel go places you know we all saw that and then on the opposite end of things we had an increase in demand for other goods and items you know Sanitary products uh PPE stuff that was Necessities will really increase in demand because we all needed those products right away so then there was the issue with the supply we weren't having enough of them because previously or prior to the pandemic hitting or starting we had a different level of demand for those goods so Supply was at that particular level to meet that demand when the man's really spiked for those products there wasn't enough out there to supply those goods companies were in manufacturing to those good to that I 90 or that level of demand when we hit the pandemic and we hit the lockdowns so we all were Witnesses on that right you went to the store and there wasn't enough toilet paper that was because companies were working off a certain demand level and they were planning their production and their distribution of the toilet paper products at a certain level when pandemic hit and we all went into a frenzy of not having enough toilet paper believe me I I did I did go through them myself but we went through this sort of panic of buying so much pen toilet paper that we weren't able to make enough as fast as the demand was being provided okay and now we see demand levels that are more evening out we have also inflation and other economic factors are affecting the market out there but as a business what you have to do is be very very aware of these issues affecting your market and be able to sort of adjust to that as you progress in your demand planning schedules and also as we move into the production of those goods so in this section we're going to talk about the benefits of effective the main fact now we know what it is what it's good for but we also need to understand that we need to do it well so when we do it effectively it really can offer a numerous amount of benefits for businesses we can by accurately forecasting demand businesses can optimize their inventory levels they can reduce the amount of excess inventory and they can minimize the risks of stockouts this all summed up can really lead to cost savings and it can improve customer satisfaction if we're not talking up as much money in inventory because we know exactly what to buy and how much to buy then we're having a better cash flow in our business if we're having products as customers Place orders the customers are going to be happy with us they're going to know that they can rely on us they can depend on us they can trust us to have the levels of inventory we need to be able to fulfill the demands and have a little bit of a cushion in that sense and that always keeps customers happy right because we need to be able to fulfill their needs very quickly and efficiently because there's such a competitive market out there for basically all products that are in the market okay so you're telling yourself okay Professor Rodriguez sounds all nice and and great and fancy but how do we actually do that as a business or how do I as a student learn to do this well that's what we're going to talk about in this section we're going to talk about effective demand planning strategy to implement effective demand planning strategies for your business or for the company you work for we're gonna really need to know about certain strategies and Implement certain tools these may include data analysis market research and using the man forecasting software it's also important to have a flexible supply chain that can really quickly adjust to changes in demand now here I'm going to tell you what are some of the top demand forecasting software providers that are out there and some of the ones that I'm familiar with that I've used in the past some of the ones that some colleagues have used as well and also for some of the research that I've done on my own on my end so I'm going to give you a list of them all right so this is this is nothing bias I'm just I'm not going to rank them I'm just going to give you a list of orders some of the demand forecasting software providers so that you can learn more about them I'm going to tell you where you can find some free or relatively free courses on those softwares okay so here we go so the first one that we have is SAS forecast or SAS forecast server now SAS offers a variety of free courses on demand forecasting including courses on forecasting methods time series analysis and data preparation for forecasting these courses are available through their own website so you do if you want to implement this software for your company your business you do have to pay for these Services you have to pay for these uh software or these systems but if you want to learn about them because say your company that you work for or the business that you work for they want to use this or something similar you can always get access to courses on how to do that and become more familiar with it we also have the trusted and very old school Microsoft Excel now while Excel is not dedicated exclusively to the man forecasting it can be used to perform basic forecasting tasks now Microsoft offers a range of free courses in Excel including courses on forecasting and time series analysis so you can always Google those or check those out the next one that I'm going to talk about is Oracle the Mantra now Oracle offers a free trial of the demandra software which includes a range of the man forecasting tools so this is something that your company has been looking to get into or get into their operations and implement the man casting software well Oracle offers a free version or a free trial I shouldn't say version I should say trial a free trial if they're honorable they may enter system they also have a variety of courses on demand forecasting and supply chain planning through their Oracle University next we have IBM planning Analytics IBM offers a variety of free courses on this platform on demand forecasting and planning through their IBM skills Gateway now these courses cover topics such as time series forecasting predict analytics and demand planning next the next software is sap or sap I call them sap I hear people say sap a care people call sap we say sap sap integrated business planning now sap offers also this is a type of demand forecasting software that they offer but they also have courses for you to learn about the demand forecasting and planning features within this system now you could learn this about these courses through what is called the sap Learning Hub while some courses do require you to have a paid subscription they also have other free courses on demand forecasting and sales and operations planning up next we have Tableau now Tableau is a data visualization software that can be used for demand forecasting and they do offer a variety of free courses on data analysis and visualization which can be useful for forecasting people and they can be useful for people working in this sort of Industry all right so this is very data driven tasks and you're able to figure out more visually where your demand planning might look like up next we have our R is free open source software for statistical Computing and Graphics it includes a range of libraries and packages for demand forecasting and for also for time series analysis now there are many free courses and resources available for learning R which includes the r product website and various online learning platforms like in data camp and also on Coursera finally we have python now python is another very popular language for data analysis that can be used for forecasting as well there are many free resources available online for learning python I've started and I'm still in that process and I can tell you that it's easy enough once you get the hang of it now these can include courses like Coursera courses edx courses as well some of them are free but you do have to pay to actually get the certification once you finish the course but if you get the course for free you're learning about it so why not and code academy as well as various tutorials and guides that you can find online here on YouTube which are all very great so you can check those out as well I will say and it's very important for me to note that the man planning software and systems can really vary widely depending on what industry you're working in the terms of the costs how complex they are and what are the features of these systems now the software systems that I listed below may or may not be suitable for all businesses so it is important to do your own research and to evaluate each of them and give them you know your own grading your own review based on what the means are for your specific business what are your goals what are your needs and based on what you're going to implement this software for all right this is just like a broad review of them so you can get a better idea of what is out there if you weren't too familiar with all right so this is as far as technical as I get we will continue to move on in the lesson with what's next planning is a complex process that involves predicting consumer demand for products and services we have established that now the goal of the man planning is to anticipate future demand so the businesses can adjust their inventory levels ingly and also ensure that they have the right amount of inventory on hand to meet customer needs without having too much or not enough which I mentioned earlier in the lesson so ultimately just keep in mind that the goal of the main planning is really to anticipate future demand some of the software systems that I mentioned earlier helps us do that by inputting data sales numbers anything that we can find as far as uh quantitative data so we can take out of that equation a result as to what we may think the levels of inventory might be in the future based on previous data sales and historical information okay in this section we're going to talk about the key principles of effective demand planning a first is to use historical data historical sales data is a key input for demand Planning by analyzing past sales information or data businesses can identify patterns and Trends and demand which can be used to forecast the future demand it is important to ensure that the historical data that is being used is relevant also accurate as this can greatly impact the accuracy of the results meaning the actual demand forecast all right next is considering the market trends market trends can also be a very important input for analyzing demand and for planning our Demand by sort of taking a look at the trends in the market such as changes in consumer Behavior or the emergence of new competitors businesses can really anticipate changes in demand and adjust your inventory levels ingly another key principle is to use multiple data sources effective demand planning relies on the use of multiple data sources in addition to historical sales data which we establish is very important and to the market trends business can also use other things such as customer feedback industry reports and other sources of data to inform their demand planning process or to input into their systems next is involved multiple stakeholders demand planning is cross-functional process that involves multiple stakeholders including sales marketing Supply Chain management and finance it is important to involve all these relevant stakeholders or departments or areas and the demand planning process to ensure that all the perspectives are being considered and that the demand forecast is accurate another thing you learn about supply chain in some of the next lessons is that the demand plan sort of Swifts this way or pushes his way into the supply plan meaning once we figure out how much demand will have that will end up in how much we plan to produce and that's called a supply plan so without a demand planning place that everybody can agree upon everybody can be in a consensus about within all these different departments that include all these different stakeholders if we can come to a consensus on one single demand like you can't have multiple you can only have one one single demand plan that is going to push forward into our supply plan that we can proceed and that's something that is basic in what we know as Supply Chain management so keep that in mind finally be flexible it is important to maintain a flexible supply chain that can quickly adjust to changes in demand this may involve maintaining Safety stock levels having backup suppliers and other strategies to ensure that the business can respond quickly to changes in demand if you watch our episode number seven you learned about demand and supply chain uncertainty and some of the factors that cause disruptions in our supply chains this also sort of carries along here because what we're trying to plan for our demand we need to know how to adjust to certain things that will disrupt our supply chains and the purpose of being flexible or agile or responding quickly to changes is that so we can resolve those issues those uncertainties in our supply chains and be able to adapt to those changes we also see that here in demand planning so it's another principles another key thing within within demand planning is to be flexible because yes we do want to have a demand forecast and Implement a demand plan but if we see something that's happening and something that can majorly impact our operations our demand that we need to be able to implement that and have ways to implement that as well okay and to my favorite part of the lesson which are the examples now we're going to talk today um about companies using demand planning many companies have successfully implemented the man planning strategies to improve their supply chain management I'm going to give you three examples of companies that have done that and how they have effectively used demand planning so we have today we're going to talk about Amazon Zera and Coca-Cola okay so first up is Amazon now with this very vast inventory and a rapid delivery times Amazon is a company that relies heavily on demand Planning by analyzing customer search data sales patterns the company is able to anticipate the man for products and adjust its inventory levels ingly okay so here I'm going to take you sort of by the step-by-step or the the progression of how Amazon does this because Amazon really does implement demand planning processes and they're a very crucial part of their operations because like I said it helps to make sure that they have the right products for the right quantities and at the right time to meet their customer demand the process involves a number of steps that are designed to help Amazon forecast the man accurately plan their inventory levels optimize their supply chains and to ensure that the products are delivered to the customers when the customers need them I mean Amazon customers we can say and if you're familiar with Amazon I'm sure you are you expect fast delivery or you're expecting the product to get to you based on what you how you order it a day or two days three days maybe you're expecting sort of a faster delivery time on that so here I'm going to take you through the the step-by-step of how Amazon demand planning process looks like the first thing is data collection this is the first step in Amazon's demand planning process they collect data from various sources this includes sales Data customer feedback market trends and other relevant information that can help them in their forecasting for the demand Amazon uses Advanced analytics and machine learning algorithms to process and this a huge amount of data and to help them identify patterns and trends that can help in predicting future demand if you've ever been on the website right or on the app and you've made a purchase and at the bottom of the section of the item that you're looking at it'll tell you related items to the search or other customers have also purchased and it gives you a list of that right or it gives you a list of saying based on your previous purchases this you might be interested in this and you can check those out this is done based on your historical sales data what other people in your area have purchased what other people searching for the products that you're searching have also purchased and any kind of information you have either on your profiles on your settings and on your previous purchases so all of this is data as information it's something that Amazon can use to better serve you as a customer some may find it creepy but you know it's it's Up For Debate and that's another whole discussion Amazon really does use this data to give you a better consumer experience all right next in their step is the man forecasting now based on the data collected Amazon uses various statistical models and forecasting techniques to estimate future demand for each product this involves analyzing historical sales pattern seasonal fluctuations and other factors that can impact demand Amazon also considers external factors such as economic conditions consumer behavior and competitor activity when forecasting for demand next is or third is inventory planning once the demand forecast has been determined Amazon uses this information to plan inventory levels for each product this involves certain safety stocks levels reorder points and Lead times to ensure their products are always available when customers need them Amazon also uses the man sensing techniques to adjust inventory levels in real time based on actual customer demand they have the ability to do this your system is very sophisticated in order to be able to do this in real time next we have supplier collaboration Amazon Works closely with its suppliers to ensure that they can meet the demand for each product this involves sharing the man forecasts inventory levels and production schedules with suppliers to help them plan their operations ingly Amazon also uses what is known as a vendor managed inventory or BMI system to allow suppliers to manage inventory levels on behalf of Amazon now next we have supply chain optimization Amazon continuously optimizes its supply chain to ensure their products are delivered to customers in a timely and cost-effective manner this involves using Advanced Logistics algorithms and transportation management systems or TMS to optimize delivery routes reduce Transportation cost and to minimize the lead time and finally we have performance monitoring Amazon closely monitors the performance of its Supply planning process to ensure that it's meeting its objectives this involves tracking key performance metrics such as forecast accuracy inventory turnover and customer satisfaction Amazon uses this information to identify areas for improvement and to make changes to the demand planning process as needed now overall as you can see from these steps or this process that Amazon has the demand planning process is really complex and a very sophisticated system that allows them to meet the ever-changing demands of their customers by using Advanced analytics machine learning and supply chain optimization techniques Amazon really is able to forecast demand accurately plan inventory levels effectively and optimize their supply chain to deliver products to customers now the next example I have for you is Zara the fast fashion retailer now Sarah has gained a reputation for its ability to quickly respond to the changing fashion trends and they sort of started the trend with fast fashion that we see replicated in many other businesses and companies nowadays now this is due in large part to their sophisticated demand planning system which enables the company to anticipate demand for specific items and adjust its production ingly Sarah like other fashion retailers relies on demand planning to ensure they have enough inventory to meet customer demand while minimizing waste and Overstock here I'm going to take you through the step-by-step overview of what Sarah's the man planning process looks like first up we have sales forecasting Sarah's in the implying process starts with sales forecasting the sales team provides input on historical data or historical sales data current sales Trends and expected market conditions to predict future demand for each product category this helps Zara understand how much stock they will need to produce and allocate to each of their stores next we have inventory analysis Sarah then conducts an inventory analysis to determine how much stock they currently have on hand and where it is located this helps them decide how much new stock needs to be produced and shipped to each store to meet the forecasted demand so the third step is design and production planning was demand has been forecasted and inventory has been analyzed Zara's design and production team work together to plan when new products will be produced and what this process includes setting timelines for each stage of production from sourcing raw materials to finalizing designs to manufacturing and shipping finished products next is allocation planning Zara then uses the sales forecast and the inventory analysis to determine how much inventory should be allocated to each store this is based on factors like past historical sales performance store location and the demographics of the area of the store is located in the final step is review and adjust throughout the season Sarah continuously reviews and adjusts their demand planning process based on actual sales performance and inventory levels this allows them to quickly respond to changes in consumer demand and adjust production and allocation ingly overall Sarah's The Man flying process is a continuous cycle of forecasting analysis and planning as well as adjustment all of this and everything that they do is really aimed at ensuring that the right products are available and the right quantities at the right stores to meet customer demand and the last example that I have for you is Coca-Cola as a company that produces and distributes beverages around the world Coca-Cola relies heavily on demand planning to ensure it has the right inventory levels in each of the markets that they serve by analyzing sales data and market trends Coca-Cola can adjust its production and distribution to meet the change in customer needs so here we're going to talk about the steps in or the steps that Coca-Cola typically follows in their demand planning process the first one is to collect historical data the first step here will be for Coca-Cola's demand planning process or demand planning team is to collect historical data on sales production and other key metrics this data is typically collected from a variety of sources including Poss or points of sale systems Distributors and retailer step two is clean and normalize the data you'll hear this a lot in demand planning once the data has been collected it is cleaned and normalized to ensure that it is accurate and consistent this involves basically removing any errors any duplicates or outliers from the data set that you're using the next step is to analyze the data to identify any Trends patterns or other ins site that can be used to inform the demand planning process or team this analysis may involve using statistical models or other techniques to forecast demand based on historical trends the next step is to collaborate with stakeholders once the data has been analyzed Coca-Cola is demand planning theme Works closely with stakeholders across the organization to gather input and insights into demand drivers market trends and other factors that may impact the demand next we have to develop a demand plan based on the insights gathered from the data analysis and from the stakeholder collaboration Coca-Cola's demand planning team develops the demand plan this plan outlines projected sales volumes production schedules and the inventory levels for each product in each market the next step for Coca-Cola is to review and refine the plan the demand plan will be reviewed and refined based on the feedback from stakeholders and any new information or or insights that may have emerged since the demand was initially developed this is a great example of being flexible and being agile enough so that you can make tweaks and changes and refine the plan that was already established as we mentioned earlier step number seven is to monitor performance once the demand plan has been finalized Coca-Cola is the main planning team closely monitors performance to ensure that the actual sales and the production volumes align with the projected plan any variances are then analyzed and the demand plan may be adjusted as an immediate to ensure that it remains aligned with the actual demand and the last step is continuously improving the process Coca-Cola is the main planning team continuously reviews and improves its demand planning process to ensure that it remains effective and efficient this may involve implementing new tools or Technologies refining the forecasting models or making other improvements as needed overall you can see that Coca-Cola is the man planning process is complex and the process really involves data collection analysis stakeholder collaboration and also like an ongoing performance monitoring and Improvement which always speaks volumes for the company and how they run things by following these stamps Coca-Cola is able to effectively forecast demand and ensure that it has the right inventory levels and production schedules in place to meet the customer's needs well I hope you really enjoy some of those examples as far as what companies and what they're demand planning process looks like but I do want to make a very important point that the man planning is a critical aspect of Supply Chain management that enables businesses like Amazon like Zara like Coca-Cola and others to anticipate and respond to changes in consumer Demand by implementing effective demand planning strategies processes businesses can really help themselves to optimize their inventory levels to reduce waste and to improve their bottom line by accurately predicting future demand businesses can really ensure that they have the right amount of inventory on hand to meet customers without the need to Overstock or under stock or sell out or stock out all right so that's a very important to know so I hope you really learned a lot about the man planning in today's lesson in the next lesson in the series I will discuss what are supply chain drivers so I hope you stay tuned for that that is though the end of today's a lesson lesson number eight on what is demand planning I thank you very much for watching I hope you're finding this useful informative and you're learning more and more about Supply Chain management with each video and each lesson I hope you stay tuned for lesson number nine don't forget to give us a like subscribe to the channel and even leave a comment below on what you're interested about Supply Chain management or what you want to learn about next that is all for today I will see you in the next lesson take care bye [Music] foreign