Implementation of forecasting
The implementation of forecasting involves transitioning from addressing urgent matters to focusing on what is truly important. Ultimately, the art of forecasting lies in using forecasts only where necessary and employing them correctly. Forecasts play a vital role in risk assessment, a skill that must be honed and mastered.
We propose our method consisting of three steps, which include:
Step 1. SCM Training (Supply Chain Management)
Step 2. MPP Training (Master Planning Policy – Planning: S&OP and MPS)
Step 3. Implementation Workshops
- Preparation of forecasts using quantitative methods.
- Incorporating market knowledge (Market Intelligence) and planned marketing events into forecasts.
- Assessing the credibility of forecasts.
- Building trust in forecasts and involving other participants in the forecasting process.
STEP 1. SCM TRAINING (SUPPLY CHAIN MANAGEMENT)
GOAL: ACQUIRING KNOWLEDGE AND OVERCOMING RESISTANCE TO CHANGE
Show your team that their work can be simplified and made more efficient through SCM training. During the training, your team will learn:
- The workings of the forecasting process in integrated planning.
- When forecasts are truly reliable.
- How to assess the risk of forecasts and use this knowledge in planning.
- Strategies to ensure high forecast reliability without spending whole weeks on their preparation.
The training will also furnish you and your team with a checklist to evaluate additional areas for improvement within the company and to determine if forecasting is indeed the priority.
Following SCM training, collaborate with 2-3 enthusiastic team members to create this checklist. It will aid in identifying areas where forecasting can notably enhance the company's operations and confirm its alignment with the company's needs.
If the outcome of this exercise confirms that forecasting would be beneficial, we recommend proceeding to the second step.
STEP 2. S&OP AND MPS PLANNING TRAINING (MPP. MASTER PLANNING POLICY)
GOAL: IMPLEMENTING CHANGE
After completing the checklist, it's essential to provide leaders with the necessary knowledge about the process. Enroll them in the MPP training.
During the training, leaders will learn various essential aspects including:Identifying internal forecast customers.
- Measuring the correctness of the process.
- Selecting the appropriate level of forecast aggregation.
- Preparing data for analysis.
- Applying forecasting techniques in different scenarios.
- Understanding the interaction between the forecasting process and S&OP and MPS processes.
- Gaining insights into how S&OP and MPS processes operate.
During the training, leaders will receive implementation handbooks and post-training coaching support. Armed with the knowledge acquired and the implementation handbook, leaders will be empowered to initiate the development of a process prototype within your company.
Given that each company has its own unique requirements, processes must be tailored accordingly. Therefore, leaders will focus on a selected area of the company, such as a few finished goods indices, to create a process prototype. This can be easily accomplished using basic tools like Excel.
STEP 3. IMPLEMENTATION WORKSHOPS
GOAL: EMBEDDING THE NEW APPROACH THROUGHOUT THE COMPANY
After the forecasting process begins to produce the expected results, you can move forward with extending the implementation to the entire organization. The positive outcomes attained through the prototype will serve to persuade other employees that the process is effective, superior to the current method, and applicable to their areas as well.
Organize an implementation workshop using the proven case from the previous step, which should ideally be your own case study.
To ensure the process becomes ingrained within the company, it's crucial to have experts refine the process and ensure its ongoing efficiency. The knowledge and experience gained by leaders through training, prototype creation, and implementation expansion have transformed them into internal process experts. With their expertise, the process will become a permanent fixture within the company.
Interested in seeing if this method fits your organization's needs?