The future Demand Planner
Our expert's opinion
"The demand planner of the future will focus more on pre and post analysis, creating more value for different stakeholders (not only for the supply chain). This will result, especially in production environments such as food and pharma, in better service levels."
- Lien Vertommen, Senior Associate
The Demand Planner of the future will not report to Supply Chain
Seth Godin, bestselling author of the books Tribes and Linchpin, once said in an interview that if you can only do what someone else tells you to do and nothing more, then they can find someone (or something) cheaper than you to do it. If you can creatively think through problems, present solutions and make decisions, then you’re a resource that can’t be replaced.
The Institute of Business Forecasting (IBF) asked professionals a few months back a few simple questions to gauge where people in the profession saw Demand Planning and forecasting in the year 2025. A summary of the report came out in the Winter issue 2017/2018 of the Journal of Business Forecasting (JBF). This and other articles will look deeper at those answers and what the future may hold in regard to people, process, and technology in the realm of Demand Planning.
While we did not ask directly if the role will be fully automated in the future, we did ask what the core competencies for the role will be in the year 2025. This sees a changing and possibly elevated Demand Planning role, one that evolves from analyst to a master of orchestration and provider of insights.
Where do You Fit In The Digital and Demand Planning Revolution?
According to many industry observers, we are today on the cusp of a Fourth Industrial Revolution. Developments in previously disjointed fields such as Artificial Intelligence and Machine Learning, robotics, advanced analytics, 3D printing, and cognitive technology and deep learning are all building on one another. The Internet of Things will help tackle problems ranging from Supply Chain Management to Operations. Concurrent to this, the digital revolution threatens to not just give us more data, but do your job faster, better, and cheaper than you do it.
What does this mean to us, will we be replaced? Your view of a demand planning robot of the future really depends on how you view your role today. If you are only doing what someone else tells you and aggregating data, or relaying what the forecasting system is generating, then they can find something cheaper. If we just need a number, technology can do this faster and more efficiently with greater number of inputs and more accurate outputs.
If you view Demand Planning as discipline that uses data, forecasts and experience to estimate demand and provides solutions for various business needs, then you are the next generation and ahead of the curve.
For the last few decades or more, a forecaster’s role has been considered primarily to provide an accurate single point estimate to a supply chain based on history and inputs from sales people. The fact is that the entire business, not just supply chain, needs insights into what will happen and the focus should be on growing profitability of the enterprise. This requires more complete, detailed analysis and quicker answers. What we are seeing today is that the Demand Planning role is changing and we need to migrate from Big Data to big answers.
We Conducted a Survey Into The Future of The Demand Planning Role And Here’s What You Said
This was clear as well in the results from the recent online survey conducted by IBF in September 2017. Unsurprisingly, the number one soft skill needed for Demand Planning was Advanced Decision Making (first choice for 34 of the 200 respondents). I say not this is unsurprising because we are seeing this theme play out across multiple functions (like in FP&A) and is becoming a wider business need. Right after Advanced Decision Making comes our ability to Synthesize Data and Information, followed by Analytics. These top three needs captured almost half (42%) of all responses.
So what does this say about the role of Demand Planning in the future?
The Demand Planner Of The Future Will Be The Story Tellers Who Use Numbers As Their Language
As I mentioned in an earlier post, “My Case for A Centralized Forecasting Process”, Demand Planning can help provide synergies to many other functions and is uniquely qualified and positioned to help a company paint a fuller picture of what is to come. In that article, I referred to us a storyteller who uses numbers as their language. This is seen in the survey with Analytics which received a combined total of 85 first, second and third choices, placing it as a joint top priority. This is not analytics in the sense of a data junkie and a wizz kid at algorithms, but someone who has the ability to develop and plan analytics projects including gathering and visualizing data in response to business needs.
The Demand Planner Of The Future Will Not Report To Supply Chain
It may not (and I believe it won’t) be a Supply Chain role but will be elevated to a more unbiased centralized function with specialties that support multiple purposes and enables decisions making across the organization. The focus of Demand Planning will be more on sales enablement as well as wider ‘business enablement’. When you have more than a dozen people acting as decision-makers and influencers and competing priorities for their time, attention and money, having the right information at the right time to provide context and direction is highly valuable – and that is where the Demand Planner should come in.
The Demand Planner Of The Future Will Focus More On Pre And Post Analytics
The Demand Planner of the future may not be the statistician and programmer you may think we need in the digital world of tomorrow. The truth is that as technology continues to advance, it will not be the creators of the algorithms who will be in high demand but interpreters of them. We see this point clearly illustrated in the survey results; skills like Software Engineering count for only 1% of peoples’ first choices, and Mathematics and Statistics are also low down in the list of priorities.
This is not to say highly sought-after skills like knowledge of R and Python and advanced analytical programming are not needed today but it does provide a glimpse into the Demand Planning role of the future. What will be in more demand is the pre and post analytics that provide insights into what questions to ask, and assist in communicating the impact of the results to the business. These are two soft skills that may never be replaced by machines and are indeed likely to be in greater demand than ever before.
While clearly all of these soft skills or core competencies are important, judging from the responses and what we are in our own organizations, the Demand Planner of 2025 will be an elevated role that will creatively think through problems, present solutions, and make decisions. And most of all, you will be a resource that can’t be replaced.