Challenges - Demand Capacity Management
Demand Capacity Management: Managing reliable material supply
Creating and sharing reliable forecast information to vast supplier networks is a critical challenge to today’s manufacturing companies. In an effort to meet this challenge, companies often rely on planned valued originating from office-based tools via a demand vs. real order relationship that is often misaligned. This can result in a number of significant disadvantages hampering the efficiency of planning and production programs including:
- Poor or inaccurate forecasting and modeling.
- Delayed or reduced responsiveness and agility with regard to supplier and material fluctuations.
- Severe gaps in logic or linkage between data sets and analysis opportunities.
- Decreased ability to meet customer demands and ensure on-time delivery of products.
To combat these pain points, manufacturing companies often build high inbound stock volumes in order to cope with these process gaps. However, this creates a larger, more systemic problem relative to intercontinental inbound supply and production chains centered around long lead times. Longer lead times with an increasingly global sourcing of materials and suppliers means inbound stock volume spikes dramatically, which creates additional information gaps and associated costs while hampering production efficiency.