📊 The Level 1 Trap: Why Basic Demand Planning Needs Fixing First

Most smaller companies are operating at Level 1 of the Demand Planning Maturity Curve – the basic level. Valtitude using our consulting knowledge base have designed a Demand planning Maturity roadmap that classifies companies into five levels on the maturity curve.

🔍 Level 1 typically is characterized as

– 📝 spreadsheet-driven,
– 👔 sales-led plans typically Sales Managers provide a spreadsheet or load it into their CRM system
– 🚫 no formal forecast review,
– 🔥 ad-hoc S&OP meetings during crisis

Typically the demand planners, by whatever name they are called, they are demand coordinators. They pass the numbers from Sales Managers to Supply Planners.

⚠️ Two things these firms should NOT do

1️⃣ Embark on setting up a Sales and Operations Planning Process or an IBP process. DP is an essential pre-requisite of S&OP/IBP

2️⃣ Invest in a planning technology transformation for IO, Supply Planning or S&OP. Even worse, embarking on an AI transformation project.

💥 When you do not have demand defined, these sequential steps will result in more chaos!

🚨 If your planning team spends more time gathering data than analyzing it, you’re not ready for AI.

Look to move from Level 1 to Level 2 with a baseline forecast from a simple but robust stat engine, define a consensus process and hire a demand planner that can add intelligence, honesty and validation of the Sales Forecast before it becomes the demand statement for the company.

📖 For more details on designing a best-in-class demand planning process, please see https://demandplanning.net/demand-planning-design/.

📞 Call me if you have questions!

#DemandPlanning #S&OP #SupplyChainTransformation #PlanningMaturity #ForecastAccuracy #IBP #SupplyChainStrategy #Valtitude #PlanVida #PlanToTheConstrain