The role of forecasting in a supply chain
All push processes performed in
anticipation of a customer demand whereas for pull process manager must plan
for inventory and capacity. For example, Tata Motors, the automobile
manufacturer from India, order auto components In anticipation of customer
orders The company also uses its plant capacity to keep inventory at factory as
well as at retailers’ location. The ordering a component is a push process
whereas manufacturing and utilizing the capacity is a pull process. Now,
MRF, supplier to the Tata Motors, also needs to forecast for its orders and
capacity utilization. Thus each player is the supply chain forecast separately
and that leads to mismatch in the forecasting. Hence modern Supply Chain
management software and organizations consistently forecasting on using CPFR
and block chain model. CPFR is collaborative planning forecasting and
replenishment.
Let me explain with another example of
Godrej a consumer goods company. The company has begun a project called '
Sampark' distribution management system used for stock management billing for
customer and report generation. For this project implementation, Godrej has
roped in carrying it Forward agents(C&F) agents, and distributors. This has
eliminated Multi-point documentation done earlier. Further it also helped in
regular replenishment, reducing the inventory and the better forecasting.
After the initial success of
sampark, Godrej has launched two new projects called. Sahayoga and the
sampoorna either. Godrej has helped the intermediaries to reduce their lead
time, tracker orders and quick settlement of outstanding wherein sampark has
implemented for retailers to track final customer orders.
