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    Establish Trust via Demand Planning

    Posted by: Nancy Pakieser | April 3, 2012

    business leaders forecasting demand


    Hard to gain, easy to lose, and widely discussed in supply chain management in healthcare. Typically, trust is limited, and the lack of it is limiting our ability to work together. So how do we, as supply chain participants, create it? The answer is multifactorial; however, one key component is communication. An easy channel for communication is data and metrics, and heaven knows we have data!

    A good starting point in building trust is sharing data via demand planning or forecasting. By sharing your anticipated demand of a product or group of products, you become a more active participant in managing the healthcare supply chain. What does this mean?

    For providers, it means implementing a demand planning process. The first outcome would be leveraging internal data to track and measure historic use or consumption, and then applying analytic methodologies (formulas) to predict (forecast) future demand.

    The trust building occurs when you SHARE your forecasted demand with your trading partners. This in turn enables your trading partners to incorporate your needs into logistics or production schedules, improving their operational efficiency. If they can plan their shipping schedules or production schedules based on accurate forecasting, they can better manage their cost of business and pass these savings through the supply chain to you.

    For suppliers, utilizing demand planning data provides them the ability to aggregate global customer demand and then apply this forecast to their production or shipping processes. This enables them to leverage economies of scale, supply what the market is demanding in the quantities and mix the market needs.

    Over time and with ongoing practice, the demand planning from providers will get better, the manufacturers and suppliers will learn to believe the data and will fully commit to managing to the market demand. This is one definition of trust that would serve the entire US healthcare system.

    Sharing data = trust among trading partners. Wouldn’t this be a terrific discussion to be having?!!

    To learn more about Demand Planning, check out the free webinar video series, Demystifying Demand Planning, located on our Planning and Procurement page.

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