Tag: demand management process

demand management

Infiniti’s Demand Management Solution Helped a Medical Devices Manufacturer to Achieve Average Savings of $7.2 Million

The US medical device industry is one of the world’s largest industries and is constantly being driven by the emergence of new technologies and innovative manufacturing methods. Though medical device manufacturing companies have witnessed unprecedented growth in terms of innovations and improved technologies in the last decade, such dramatic advancements have also given way for several challenges that loom over companies operating in the medical device industry. Owing to the increasing challenges in the market, companies in the medical device industry are increasingly leveraging demand management solutions to manage and allocate capacity to meet the markets’ increased demands.

Accurate demand management is critical and can sometimes be tricky. The information gained from a demand management engagement can be used in all aspects of a manufacturer’s business, including manufacturing schedules, inventory management, product positioning, and production planning. Request a FREE brochure to gain more insights into our services portfolio.

Business Challenge

The client is a medical device manufacturer based out of the United States. The company is well-known for manufacturing a wide range of healthcare devices. Inconsistency in the product demand, owing to fluctuations in the market made capacity planning quite challenging for the client. Also, due to their inability to meet the rising market demand, the client was unable to maintain the right balance between supply and demand, which resulted in reduced profit margins for the company. This necessitated the need to capitalize on these market changes through better forecasting and demand planning. To achieve this business goal the client had to enhance their demand management process by considering several factors that affected the demand of their medical devices.

Other challenges faced by the client included:

  • With growing advancements in medical technology, the medical device manufacturer was looking at implementing a robust method that would help them protect margins with products that elude commoditization.
  • The client was facing increasing pressure to adapt to a fast-evolving marketplace by effectively catering the needs of the increasing population.
  • The client faced major challenges in identifying long-term savings opportunities and areas for cost-reduction to facilitate product design and development.
  • By employing an effective demand management process, they needed to effectively manage the supply-demand shortages.

Solutions Offered and Value Delivered 

To help the client tackle all the industry challenges, the experts at Infiniti Research followed a comprehensive four-phased approach. The approach focused on helping the client accurately plan, predict, and meet the demands of the global customer base.

  • The initial phase in demand management approach focused on segmenting the market based on sales and ­­­marketing outcomes to analyze and anticipate different customer needs and long-term market trends. This turned out to be a fundamental factor that helped them align their business model and supply chain functions accordingly.
  • The second step in demand management process involved documenting the process roadmap, which included market gap analysis, a detailed analysis of success factors, and the roadmap for each stage.
  • The third phase of the demand management approach focused on bridging the cross-functional disconnect. The cross-functional disconnects were overcome by establishing KPIs.
  • The final phase in demand management process involved a detailed analysis of factors such as the number of consumers in the target market, demand for medical devices, proportion expected to buy the medical devices, anticipated timing of their purchase, and patterns of repeat purchases.

Insights obtained from Infiniti’s demand management engagement helped the client to formulate effective strategies for making smart decisions about inventory and production levels. This subsequently reduced the risk of stock-outs, resulting in lower holding cost and increased turnover rates. Also, the heightened visibility of their demand chain enabled them to capitalize on new opportunities to enhance the patient outcome and drive revenue.

Moreover, Infiniti’s demand management engagement also delivered tangible outcomes in their supply chain, most notably the cost savings obtained from inventory management and demand planning. Infiniti’s demand management solution further helped the client improve under-forecasting by nearly 3.5%, representing average savings of $7.2 million in a year.

Poor healthcare access and the growing demand for advanced medical devices represent a management dilemma between effectively managing demand and costs. Are you facing the same challenge? If yes, request a FREE proposal to know how our demand management solutions can help.

Why demand management is important?

In today’s competitive world, a number of companies are leveraging demand management solutions to meet the evolving needs of their business at every level. Demand management is a business process that enables organizations to respond to emerging situations in an effective manner by maintaining the right balance between supply and demand.

Engaging in demand management practices helps organizations to avoid gaps in supply and demand and also promote better supplier relationships. Demand management techniques also play a major role in addressing external spending factors, arranging purchase orders, and eradicating waste.

Customer demands are extremely dynamic and unless organizations correctly chart out the demand pattern and ascertain the amount of goods to be produced, the chances of overstocking or understocking of goods are likely to happen. Using demand management solutions, companies can understand customers’ requirements and improvise on products that are not coping well in the market.

Why partner with Infiniti Research?

In today’s increasingly competitive business world, there is an ongoing need to leverage demand management solutions across all aspects of your business processes. To survive in the long-run, companies have to possess the capability to react quickly to the ever-changing supplier and market dynamics. This is where the Infiniti’s expertise as a market intelligence solutions provider comes into play. Market intelligence solutions enable organizations to gain a holistic view of the market from various perspectives. The insights offered by our experts help businesses to develop customized products/services and marketing communication strategies that help customers distinguish the brand from their peers.

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A Closer Look at Demand Management and Its Core Components

What is demand management?

Demand management, also known as consumption management or strategic spend management, involves controlling and tracking the requirements of different business units and other internal purchasing operations. Engaging in demand management practices helps organizations to avoid gaps in supply and demand and also promote better supplier relationships. Demand management techniques also play a major role in addressing external spending factors, arranging purchase orders, and eradicating waste.

Core components of demand management

A demand management process can involve a wide range of disciplines depending on the unique processes of each organization. However, on a broader level, a demand management plan generally encompasses these core components:

Forecasting

There is more to forecasting than merely loading data into a spreadsheet, forming a basic view of projected sales based on that data, and then adjusting the business plan accordingly. Including multiple scenarios in the forecasting process prepares the company for virtually any unexpected twist or turn.

Uncover the true potential of market intelligence solutions in enhancing your go-to-market strategy. Request a free brochure.

Supply planning

Irrespective of the industry, the marketplace is highly dynamic. Furthermore, there may be constant changes in the supplier landscape, wherein new suppliers may spring up in the market or an existing supplier may go out of business. But if companies are not prepared to meet these changes and only react when they occur, chances are that they may get left behind among the other players in the market. By maintaining deep visibility into the capabilities and business health of all the suppliers, organizations can be positioned for continued success irrespective of what happens in the global business climate.

Demand analysis

Basing the demand decisions only based on the sales data may be a huge mistake for companies. Most ERP systems record sales based on when a product has been shipped and not based on when it was first ordered. Only by keeping an accurate view of order history can they paint a realistic picture of the company’s demand—and then strategize on ways to meet that demand year after year.

Sales and operations planning

The idea that the supply chain organization can operate in a silo, free from the input of executives is outdated. Over the past two decades, organizations that make and sell products have embraced sales and operations to involve a wider range of stakeholders in every supply chain decision—and to incorporate supply chain information and needs into every business decision. 

Get one step ahead of your peers in the market with intelligent and agile business solutions. Request a free proposal to know how our solutions can help you achieve this!

Demand management

Demand planning vs demand management

Demand planning is the process of forecasting consumer demand for a company’s products or services well into the future. It is usually associated with sales, but it is closely tied to supply planning, which seeks to ensure that a company has enough supplies to meet the market demand. Ideally, a company’s demand-planning process helps maintain supply levels that meet demand or just slightly exceeds demand.

Demand management, on the other hand, is similar to demand planning, but demand management looks at consumer demand in the short term. Demand management is the oversight of current consumer demand to ensure that a business does not experience any loss of profits. Demand management is much more capable than demand planning when it comes to taking advantage of business opportunities in response to local events.

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Realizing Savings of 27% in Year for a CPG Company with the Help of Demand and Supply Analysis

Business Challenge 

The client, a leading CPG company in South America, was facing predicaments in effective supply and demand planning. With retailers increasingly producing and selling private label products and major competitors moving towards direct-to-consumer (D2C) models, the client, who continued to sell through distributors and retailers, faced challenges in creating best possible customer experience for end users. Also, complexities in their supply-demand planning, product development, sourcing, and production pressurized them to better manage inventory. With an appropriate demand and supply analysis, the client wanted to accurately manage product demands and fulfill customers’ demands seamlessly.

Is your inability to meet customers’ orders resulting in revenue losses for the company? Demand and supply analysis helps companies to thrive in today’s competitive market by identifying target stock levels to meet the rising market demands. Request a FREE Brochure to learn more about our demand and supply analysis solutions.

Solutions Offered and Value Delivered 

By examining historical sales data, product orders, shipments, and current sales, the experts at Infiniti Research helped the client to make smart decisions about inventory and production levels. Infiniti’s demand and supply analysis also helped the client to respond to dynamic market demand and focus on customer-centric metrics. By focussing on consumer-centric metrics, the client was able to increase adaptability to demand volatility. Our demand and supply analysis solution subsequently helped them plan inventory supply against demand and helped them to reduce the company’s inventory levels. Infiniti’s demand and supply analysis solution the client was able to improve return on inventory assets, reduce excess inventory, and meet customers’ delivery requirements.

With Infiniti’s demand and supply analysis, the client was able to achieve a 13% reduction on unfilled orders and increase demand forecast accuracy. This helped the company to realize savings of over 27% in a year.

Mismatch in demand and supply planning can result in excessive inventory costs. Is your company facing the same challenge? Our demand and supply analysis solutions have helped various companies reduce excess inventory and meet delivery requirements. Request a FREE proposal to know how our solution can help your business.

What is Supply and Demand Analysis? 

Demand and supply analysis is a type of supply chain management process that analyzes customers’ needs to determine the capabilities of the supply chain. With the right process in place, management can match supply with demand proactively and execute the plan with minimal disruptions. The demand and supply analysis process is not limited to forecasting. It includes synchronizing supply and demand, increasing flexibility, and reducing variability. If the demand outstrips resources, businesses can improve production or alert consumers about the revised shipment times. If demand seems low, the sales and marketing team might develop promotions or push for a product launch.

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