Professional Development: Demand Excellence

One of the greatest challenges facing supply chain professionals today is creation of a quality demand plan


The Demand Excellence model shows the competencies that collectively make up demand planning best practice. Your challenge is to measure your company's current state of maturity against these criteria to identify gaps — or perhaps entire process areas — in need of improving before you can execute against the model.

Measuring performance is a straightforward exercise: Simply use the maturity assessment in Table 1 to rate your business on a scale from 5 (good) to 0 (poor) for each of the various sub-processes to get a macro-view of your organization's demand excellence readiness.

Table 1: Demand Excellence Maturity Assessment

Certain businesses won't fit the model precisely, of course. A chemical producer that sells plastics resins to second-tier manufacturers may not have promotions per se, but the company may have sales programming that drives activities similar to promotions. Thus it's important to carefully consider the Good/Poor model descriptions for each of the sub-processes as they relate to your specific organization.

As a point of reference, most people usually score their businesses around 35 out of a possible 75 points on their initial review of the 15 sub-process groupings listed here. Once you rate your business against these standards your next challenge is to assess the competency of your human resources to achieve demand excellence. Because just as demand planning has become more complex, so too has the baseline skill set required by demand planners become more sophisticated.

It's Not What You Know…

Supply chain professionals are familiar with the traditional litany of must-have planning skills and abilities: quantitative mindset, collaborative nature, business-savvy sensibility. Yet these desired competencies are useless if not properly applied in the context of demand planning. Moreover, they don't address the capability of individuals to execute against a demand excellence process, nor are they specific enough to gauge the competency of your existing demand planners or demand planning team.

To provide such insight, we often recommend developing a demand planning competency matrix to conduct skills assessments. This matrix helps business leaders align the requirements of the Demand Excellence model with the requirements of the various roles already existing within their own demand planning organization.

Detailed criteria are first defined to gauge the desired knowledge level and competency of demand planners. These criteria are normally customized to fit a company's process needs, systems and roles. Table 2 shows a sample competency matrix developed to assess the skills of demand planners at one company, with "scoring" categories ranging from Aware (lowest) to Expert (highest), with Functional being the minimum target-level in terms of achieving Demand Excellence. Once the matrix has been built, the next step is to actually evaluate the skills of personnel throughout your organization.

Table 2: Demand Planning Contingency Matrix and Skills Assessment

Making the Demand Excellence Transformation

Famed UCLA basketball coach John Wooden is often quoted as saying, "You can't teach height," meaning that a person's innate characteristics are sometimes advantageous. Yet while competency in statistics is an increasingly important skill for demand planning, having a PhD in mathematics does not make you a qualified demand planner.

In our experience across numerous demand planning organizations we have found most of the skills and behaviors necessary to achieve excellence in demand planning are learned, not inborn. These skills can be taught, which reinforces the value of a competency matrix for conducting comprehensive skills assessments.

The results of these assessments can be used to develop well-targeted training plans for individuals and departmental groups. If there is a collective lack of understanding about data management, then highly focused, highly customized systems-based training is recommended. This approach ensures that time is not wasted covering fundamental "basics" when specific task-related training is what's needed, thus driving greater value in less time and much greater return on your training investment.

A Final Take-away

In our experience implementing Demand Excellence processes we have discovered that a multi-step implementation approach is simplest and most pragmatic:

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