OVERVIEW

Forecasting is probably the single most talked about process within the enterprise resource planning (ERP) business model. Master schedulers are involved with the demand plan forecast so frequently and deeply that they often feel ownership in it. Unfortunately, in many businesses the demand plan or forecast is actually done by the operations people because the demand side has not yet willingly come to the planning table to give forecasting a decent chance. In high-performance business environments, a solid handshake is established between the demand-side process and the supply side of the business.

Accountability is obvious and everybody is on the same team. This handshake culminates in the sales and operations planning process. This partnership attitude is important not only for minimizing risk, but it also creates an environment where everyone has shared goals and understands how variation from their part of the business affects other parts of the operation.

With the demand plan as a major element of the top management planning process, it becomes imperative that the master scheduler be close to both the demand plan and the process used to develop it. While the sales and marketing people have the closest knowledge, the operations people have good feedback as well. Past realities are a good input to the process, but certainly not the only or highest value-add element. The inputs to the demand plan come from many areas and should all be taken seriously in organizations with expectations of improvement. Figure 4.1 illustrates most of the more...