I am amazed at where my education has failed me at this point in life. Allow me to clarify, when I was a child I looked at older people and thought, I can’t wait to be that smart one day. Now after years of school, college, grad school and a wealth of experiences I am amazed at the things I just don’t know. Don’t misunderstand, I’m not saying I expected knowledge to solve world hunger. I mean basic stuff like why things on my desk on Monday are still there on Friday or why have I procrastinated with my holiday shopping…again. You see what I mean, simple obvious stuff that I should just know how to solve at this point.
When I managed the inventory for the retail chain Upton’s I was puzzled at why some inventories seemed to explode on the shelf, regardless of the processes that were in place to avoid the overstock. This was not just slow or intermittent demand; at times this was high volume product that a buyer believed we needed a 3 month supply on a 10 day lead time – obvious right? I know….
As the holiday starts to wind down, and we review our inventories and make plans for the spring, maybe it’s time to start thinking about what we can do different in 2016.
Is it Demand or Sales Forecasting?
Start with an easy one. Can you clearly explain the difference between demand forecasting and sales forecasting? Hint the answer has nothing to do with the math (algorithms). Review your software, no not the name (maybe it is called demand ___); the name is too obvious, look at the data being used to forecast, that is the key to understanding whether the software is using demand or sales forecasting methodology. Which is the right choice for your business?
Is it Software as a Service or Web Hosted with a monthly bill?
I am fascinated at how many software vendors call their solution software as a service (SaaS) when it’s just a web hosted solution. Can you clearly explain the difference between web hosted and SaaS? Can you list the pros and cons of each model? Can either model help you to compete better in 2016? Think about your phone apps as a perfect model of SaaS software. The phone app will have the same code for all customers, the user configures the app. The software maker must decide what configurations are possible and how to keep the app always updating to all customers at once. I know, seems so obvious in that light and yet, well, look at what software makers are claiming is SaaS, but it’s really web hosted, right?
Something New for our Readers
We have a new marketing team: Lauren, Lindsey and Heather that have been working on a new web site and also this fancy, funny white board animation technology. I love the work they have done, a big thank you to each of them. In the New Year, we will be releasing several videos on demand forecasting, lead time and inventory replenishment. Today, I have a short holiday cheer message that will bring a smile to your face about a couple of snow people. Something happens and what seems obvious it turns out is not so obvious…sound familiar in your supply chain? – watch the 40sec video below, it seems obvious what a snowman would Not Do, right?!?!
You can see all the videos at httpss://youtube.com/DataProfits
At Data Profits, we hope you and yours have a wonderful holiday season.