Your end-of-year demand forecasting and planning cycle is fast approaching — will you be able to lock it down before the holidays roll around? More than that, do you know that your plans will be accurate, and that everyone from manufacturing to sales to finance will agree that they’re accurate?
In a successful planning cycle backed by predictive analytics, everyone ends up singing their part from the same sheet of music, and the harmony is beautiful. Unfortunately, that’s not the norm. One group insists on singing much too loud. Another has only the first page of the music to work from. Yet another is in the wrong key. At its worst, it’s a cacophony; in business terms, it hurts your ability to formulate effective plans, respond quickly to changing market conditions, and stay competitive.
Let’s take a look at how advanced analytics from IBM can help you bring harmony to your demand forecasting and planning for 2019.
Fixing slow, error-prone and disconnected planning cycles
In traditional, spreadsheet-based planning cycles, 60–70% of your staff’s time is typically spent on manual data collection and validation. Different departments use different data based on different assumptions, which leaves everyone guessing which numbers are correct. Worse, decisions sometimes come down to who argues the loudest. The plant manager is working from one set of numbers, the sales team from another, and the CFO doesn’t agree with either of them, even though they may have the best data available to them. Everyone’s out of tune.
What you need is to connect data sources from across the company to get an accurate, 360-degree view of the business that’s grounded in data that everyone can use. IBM Planning Analytics gives you the ability to integrate multiple data sources so you can have a single, consistent view. That enables all departments and geographies to participate in a well-managed, harmonious planning process.
Connecting operational tactics with financial plans
Without trust in the data being used, how can different departments achieve real collaboration in planning? They can’t. Disharmony reigns.
Very often, traditional planning cycles are marred by a lack of coordination across functions. Financial and operational planning is done within silos, creating all sorts of disconnects for the business. That’s why forward-looking companies are now taking a better approach, integrating key operational planning processes with financial planning and analysis to increase forecasting accuracy for optimized resource allocation and better plans.
IBM Planning Analytics facilitates that integration. Besides integrating data sources, it offers users an interactive, customizable planning and analytics workspace — that single, consistent view — so that everyone can measure and monitor business performance, evaluate plans, identify gaps, and diagnose root causes. IBM Planning Analytics makes it easy to generate what-if scenarios and test their impact on the fly. It’s possible to immediately see the impact of alternative courses of action and reach better decisions collaboratively. People start to get comfortable singing their parts together.
Generating accurate and comprehensive forecasts
Until you harness the power of predictive analytics to create better forecasts, you’ll always run the risk of mismatches in demand and supply, overstocking of inventory, and slow turnaround times in order fulfillment — with all the associated costs.
Working in tandem with IBM Planning Analytics, IBM SPSS Modeler adds that predictive element. It allows companies to maximize the impact of their data with out-of-the-box machine learning algorithms and models. The same software that’s used in the most complex, data-intensive environments — things like predicting the behavior of hurricanes — can identify trends and complex variable interactions in your data to generate a granular forecast down to the distribution-center level. As a result, you end up with a highly accurate forecast that accounts for multiple decision variables, trade-off possibilities, and complex constraints.
Allocating resources to meet market needs
If you struggle with timely allocation of resources, it’s hard to keep up with changing internal and external demands. That means missed revenue from unfulfilled orders, sub-standard product quality, and a general lack of the agility you need to compete and grow your business. In musical terms, your singers won’t know when they should get on stage, and who’s singing which part.
IBM Planning Analytics addresses resource allocation challenges in multiple ways: complex dimensional analysis; calculations of large historical and future-oriented data sets; and alignment of future responsibilities with transaction systems. Adding IBM Decision Optimization incorporates powerful CPLEX optimization engines, used today by thousands of enterprises to solve for complex constraints in real time. Planners and schedulers using this set of solutions no longer need to rely on manual, error-prone spreadsheet modeling or using a single model. Instead, they can examine multiple models and choose the best scenario that will create the greatest operational efficiency. Now the concert is ready to begin!
Find out more about demand forecasting and planning with advanced analytics
With IBM Planning Analytics, along with IBM SPSS Modeler and IBM ILOG CPLEX Optimization Studio, you’ll get a single, consistent view of your data, create more accurate plans and forecasts, build and deploy powerful predictive models, and make more confident decisions. Even better, you’ll build a data-driven culture that has everyone in your organization singing in harmony. You’ll fill every seat in the theater and wow the audience.
Want to know more about how IBM Analytics can help you get operations and finance on the same page? Read our newest SmartPaper, “Accurate forecasting and optimized planning.”