Two Dimensions of Demand Planning

Suppose you were guaranteed that a specific investment stock will increase in value by 50% but you weren’t told whether it will happen in 5 months, 5 years or 5 decades?

How much would this information be worth to you?

Not much, right?  Why?  Simple – you need to know both the percentage increase (quantity) and the timing (when). Demand planning is very similar. The purpose of the demand planning process is to anticipate how much of a particular product your customers will want and when they will want it. So, to do a proper job of demand planning, you need to consider two equally important dimensions:

• quantity (how much?); and
• timing (when?).

The purpose of the demand planning process is to predict BOTH the quantity and timing. You can’t have one without the other.