"What strategies, principles, and methods can be leveraged to optimally match supply and demand over time?" 

That's a question that I've found in the MIT Center for Transportation and Logistic web site to describe the main objective of this research group when they're  looking for innovation in the area of industry forecasting using Demand Management ideas. 
 
The practices of Demand Management includes: 

1) "Setting customer service expectations in the long run by segmenting the customer base to offer tailored programs and differentiated services. These services might include differentiated order cycle times, Vendor Managed Inventory (VMI), and Collaborative Planning [...]

2) "Promising a customer order fulfillment date which involves gauging all current and future supply that might be used to satisfy a customer's order, in the context of anticipated demand from other customers.[...]

3) "Using decision support information to optimally enable the above processes. This information includes Activity-Based Costing, Cost-to-Serve, and Customer/Product Profitability reports

4) "Integrating the above processes so that they act in concert with each other to optimally match supply and demand over time"
 
Additionaly, I've found some interesting studies about Demand Management in Aberdeen Group, the last conclusions are: 

"the companies need to refocus their attention towards order-to-delivery excellence as a driver for demand management rather than just concentrating on demand planning (statistical forecasting). Aspects that companies should focus on include external collaboration, customer level forecasting, and integration with order management."
 
They differ Demand Management from Demand Planning as follow: 

Demand forecasting is essentially a linear process of translating input assumptions into a forecast of expected sales; demand management, by contrast, is a highly iterative process that involves driving to a revenue and profit target through prioritization of customers, channels, products, geographies and the demand stimulation programs available to the enterprise.” 
 
Finnaly, I've also found a IBM commercial paper from 2006 talking about consulting services on this matter: Demand Management: The next generation of forecasting

And a pretty interesting article focusing in IT services: A New Model for IT Demand Management


Kanban planning is all about matching supply and demand over time. So, I think that we definetely can adapt these ideas to software development and IT services operations. It seems to be a very hot topic to research when thinking in planning strategies in the kanban approach. Actually, it's kind of directly related to the differential aspects between the kanban planning process versus other methods approaches, including other agile methods.
 


Posted by: alisson.vale
Posted on: 2/8/2009 at 1:43 PM
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Categories: Management
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