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    Deman Management

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    Deman Management

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    Deman Management

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    of 4

    Section 3.1.

    Demand driven supply chain


    framework

    International
    Supply Chain
    Education Alliance
    ©Copyright - International Supply Chain Education Alliance S.C. International
    1 ©Copyright - International Supply Chain Education Alliance S.C. www.iscea.org Supply Chain
    www.iscealatinamerica.org Education Alliance

    3.1.1. Demand-driven supply chain


    fundamentals

    ©Copyright - International Supply Chain Education Alliance


    ©Copyright - International Supply Chain Education Alliance S.C.
    S.C.
    www.iscea.org
    International
    Supply Chain
    www.iscealatinamerica.org Education Alliance

    1
    Customer’s expectations are higher than ever

    l 65% of customers say their standard for good customer experiences is


    higher than ever
    l 76% of customers expect companies to understand their needs and
    expectations.
    l 76% of customers say it’s easier than ever to take their business
    elsewhere.
    l 56% percent of customers (66% of business buyers) actively seek to
    buy from the most innovative companies.
    l 71% of customers say they buy products and services they didn’t know
    would exist five years ago.

    Salesforce Report (2018) State of the Connected Customer - Insights from 6,700+ consumers and business
    buyers, Second Edition, Salesforce Research

    ©Copyright - International Supply Chain Education Alliance S.C. International


    3 ©Copyright - International Supply Chain Education Alliance S.C. www.iscea.org Supply Chain
    www.iscealatinamerica.org Education Alliance

    Demand-Driven Value Network

    l A Demand-Driven Value Network is a network that senses and


    translates demand with minimal latency to shape demand and drive a
    near real-time response.
    Sense

    Translate

    Supply
    Demand Demand
    Driven

    Shape

    Respond

    Created with information from:


    O'Marah, K. and J. Souza. (2004) DDSN: 21st Century Supply on Demand. AMR Research
    Cecere, L. D.Hofman, R. Martin and L. Preslan. (2005) The Handbook for Becoming Demand Driven. AMR Research

    ©Copyright - International Supply Chain Education Alliance S.C. International


    4 ©Copyright - International Supply Chain Education Alliance S.C. www.iscea.org Supply Chain
    www.iscealatinamerica.org Education Alliance

    2
    The need to be both efficient and responsive

    l Responsiveness: The ability to respond purposefully and within an appropriate


    timeframe to customer requests or changes in the marketplace.
    l Efficiency: The ability to reduce costs and wasted resources on non-value-
    added activities.

    Responsiveness Best in class

    Processes
    Improvement

    Strategic
    choice

    Efficiency

    ©Copyright - International Supply Chain Education Alliance S.C. International


    5 ©Copyright - International Supply Chain Education Alliance S.C. www.iscea.org Supply Chain
    www.iscealatinamerica.org Education Alliance

    Different supply chain types

    Demand Driven

    Resilient Sense
    Reliable
    Efficient demand
    and
    Right product supply
    Absorb changes
    Cost effective demand
    Right place volatility
    Shape
    demand
    Automated Right time and
    Absorb
    processes supply respond
    Right cost volatility based on
    demand
    signals

    Based on: Cecere, L. (2014) Supply Chain Metrics that Matter, Hoboken, NJ, Wiley

    ©Copyright - International Supply Chain Education Alliance


    ©Copyright - International Supply Chain Education Alliance S.C.
    S.C.
    www.iscea.org
    International
    Supply Chain
    www.iscealatinamerica.org Education Alliance

    3
    Difference between Leaders, Followers and Laggards

    Time to sense market changes


    Time to correct supply chain
    Leaders (6%)

    Followers (47%)

    Laggards (47%)

    Months 1 2 3 4 5 6 15

    Cecere, L. (2014) Supply Chain Metrics that Matter, Hoboken, NJ, Wiley

    ©Copyright - International Supply Chain Education Alliance S.C. International


    7 ©Copyright - International Supply Chain Education Alliance S.C. www.iscea.org Supply Chain
    www.iscealatinamerica.org Education Alliance

    Difference between being reactive and being responsive

    l React = “to act in return”


    l Emergency response mode.
    l High stress narrows the focus and doesn’t allow to see the entire picture.
    l Important details and information needed to make informed decisions is not
    used.
    l It is easy to misread the situation.

    l Respond = “to reply”


    l Take all relevant information in to account
    l Make informed decisions
    l Find the solution or the resources required to provide the expected reply
    l Deal with the handed issue in the best possible manner

    ©Copyright - International Supply Chain Education Alliance S.C. International


    8 ©Copyright - International Supply Chain Education Alliance S.C. www.iscea.org Supply Chain
    www.iscealatinamerica.org Education Alliance

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