Demand management is the process of ensuring customer demand and a company's capabilities are aligned. It involves capturing all work proposals in one system, guiding proposals through governance, helping customers approve proposals, and tracking approved projects. The goal is to enable customers to propose, prioritize, select, and track projects while streamlining approval processes. Demand management is based on forecasting future demand and planning production to meet those forecasts, as manufacturing managers are responsible for production planning but not forecast accuracy. The key benefits are control over product availability, confidence for sales, smoother introductions, flexibility to change, and using a single set of demand numbers.

1. DEMAND MANAGEMENT
Stepan Baboglo
2010503092

2. What do we mean by demand?
 Demand is the total number of requests for a
resource.
 Demand management is all about making
choices.
Request: an act of asking politely or formally for something

3. Demand Management
 The demand management
process captures all work
proposals in one place,
guides the proposals through
a multistage governance
process, helps customers
make decisions about which
proposals to approve, and
tracks progress on project
execution until the work is
completed.
Approve: officially agree to or accept as
satisfactory
Proposal: a plan or suggestion,
especially a formal or written one,
put forward for consideration by
others

4. Traditional Demand Management…
 Covers how a firm integrates information from
and about its customers, internal and external
to the firm, into the manufacturing planning
and control systems.
 How a firm integrates information from its
customers with information about the firms
goals and capabilities, to determine what
should be produced in the future.

5. Demand Management
 Demand Management is based on “forecast”
and plans.
 In DM, forecasts of the quantities and timing
of customer demand are developed. What do
we actually plan to deliver to customers each
period is the output of the process.

6. Demand management is
 The process of ensuring that market demand and
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the company’s capabilities are in synchronization
Recognizing all demands for products and
services to support the marketplace.
Doing what is required to help make the demand
happen
Prioritizing demand when supply is lacking.
Planning and using resources for profitable
business results

7. Optimize business processes for demand fulfillment
and improve efficiency of services delivered…
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Complete projects on
time
Reduce costs
Increase client
satisfaction
Assess the
availability and skill
sets of resources

8. Supply and Demand Through an Integrated Solution
 Manage business
demand and customer
satisfaction using a
defined and repeatable
approach.
 Collaborate with
business counterparts
using a transparent
decision-making
process.
 “Organizations that are
switching
to the demand-supply model
enjoy significant gains in
productivity and prioritization
of investments.”

McKinsey Quarterly, September 2006,
“Splitting Demand From Supply in IT”
by David Mark and Diogo P. Rau

9. Demand management components
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Goal customer service levels
New product introductions
Distribution resource planning
Customer order entry and promising
Sales and marketing plans
Inventory targets
Product commitments
Interplant shipments
Demand forecasting at item and aggregate levels

10. COMPONENTS OF DEMAND
 Demand that adds value is desirable and met
 Demand that adds value, is desirable, but
cannot be met
 Demand that does not add value,
undesirable, and should not be met.

11. IMPORTANT ISSUES
 Market segmentation
 Customer classification
 Product ranking

12. Market segmentation
 Growth
 Commonality of offering needs
 Response to brands
 Strategic importance
 Financial attractiveness

13. Customer classification
 Customer size
 Customer technology
 Company sale/ company share
 Business quality
 Importance to the value chain
 Opportunities for survival
 Willingness for alliance

14. Product ranking
 Profitability
 Customer’s value for product
 Competitive offerings
 Patent position
 Asset capability

15. WHY FORECAST AND PLANS ARE
IMPORTANT
 A manufacturing manager cannot be held
responsible for not getting a forecast right.
 A manufacturing manager can and should be
held responsible for making their plans.

16. WHY FORECAST AND PLANS ARE
IMPORTANT
 Typical demand management phases are
create, select, plan, and manage.
 Demand management is a concept that
integrates project proposals, portfolio
analysis, and project management through
workflows.

18. WHY FORECAST AND PLANS ARE
IMPORTANT
 The goal of demand management is to enable
customers to propose, view, categorize,
prioritize, select, and track projects within their
organization.
 Demand Management is based on a forecast
and planning because a manufacturing manager
cannot be held responsible for not getting a
forecast right.
 Manufacturing manager can and should be held
responsible for making their plans.

19. Following figure shows the four phases of demand management
and how they fit together.

20. BENEFITS OF DEMAND
MANAGEMENT…
 Control over product availability
 Confidence of sales force in ability to deliver
product
 Smoother product introductions
 Improved ability to respond to change
 A single game plan, based on the same set of
numbers

21. BENEFITS OF DEMAND
MANAGEMENT…
 With the Demand Management, organizations
can streamline approval processes, while
ensuring that Information Technologies (IT)
priorities are aligned with the broader business
objectives and that approved initiatives will
deliver maximum business value.
Streamline: make (an organization or system) more efficient and effective by
employing faster or simpler working methods
Priority: a thing that is regarded as more important than another

22. Thanks for listening…..