I have been part of a long and interesting conversation on LinkedIn about who should own the Demand Planning Process (I explain my view Demand Planning in an earlier blog). It was great getting all the different inputs of this conversation and I learned a lot from all the input because there was a lot of different experiences of how to go about getting the Demand Planning to get the best possible quality. My take away was that there are three main drivers to succeed with the Demand Planning process:
You need to work with setting a well-defined strategy, you need to work process driven and you need to educate the entire company in the power of planning and what forecasts mean for your company and the fact that you create and use forecasts as an integrate part of your planning. You need all of them. It’s like starting a fire, where you need three elements as well: Heat, Fuel and oxygen. If one element does not exist or is removed you have no fire. Here the strategy is the heat, the inspiration that will carry your company further and faster than your competitors. The process is the fuel, the structure that allows you to efficiently work across functions. The forecast is the oxygen; it gives you the details you need to secure plans for the future.
One thing that has struck me in this long debate about ownership is that it comes down to two choices on who should drive the demand planning process: Trust or Commitment? If you decide to let the supply chain to take ownership of the demand planning process you build the setup on the fact that the supply chain is more mature and capable in handling plans. The supply chain is also closer to the stock numbers and suppliers so the understand the consequences of their actions better, you will secure there will be more trust by placing demand planning here. On the other hand you can put the demand planning process as sales responsibility and let them drive the process through commitment, commitment to achieve the plans set.
I believe commitment is more powerful than trust, it will take you further. I believe that there is more to a sales process than just fighting to land deals at any cost and if sales are not up to the task, lend them a hand. All the arguments I have seen to why sales are not capable to manage the demand process can be dealt with. So sales can’t count, give them a navigator. They can’t forecast, make them accountable and give them tools and staff to support and follow-up. They can’t stick to their plans; once again, make them accountable, set goals and measure. Take away all the excuses and replace them with solid solutions. Empower them to make it happen.
It’s a little bit like when I want my children to do something, like “put on your shoes”. My seven-year old may say “I caaaan’t”, I would reply ” I know you can”, he replies back “No, look” and then stands in the most awkward position, making it impossible to put his shoes on and proves his point. Proving that you can’t do something isn’t hard. If he on the other hand wants to go out, the shoes are NEVER a problem, because he’s in charge, he makes the call and is committed to HIS plan. I’m not saying sales people are like children, they are simply human.