LLamasoft Supply Chain Blog

­
← Back to Blog

Demand Modeling at SummerCon & Beyond

By Vikram Srinivasan  June 27, 2018

Demand modeling was a buzzing topic at SummerCon this year. With enormous volatility in demand and constantly fluctuating market and economic conditions, there is an increasing sense of urgency to focus on demand more proactively to understand the impact of demand variability on our businesses. One of the use cases that particularly aligns with this is a leading steel manufacturer, Gerdau. Earlier this year when a 25% tariff tax was imposed on steel imports and exports, effecting their steel production plants in Canada and Mexico, forced them to evaluate what plants to source product from and how that would impact their US plants. They leverage demand modeling with Demand Guru for these unforeseen events and incorporate changes to economic factors as part of their supply chain design. As a result, they can make decisions more quickly because they have the tools in-house to do so.

We hosted demand modeling training, sessions, and a workshop at SummerCon this year. I had the opportunity to talk with our global users who, like Gerdau, had use cases to share on how they use demand modeling in their business. The workshop was one of the most valuable sessions at SummerCon as over 30 users gathered early Friday morning from across industries including chemical, high tech, food and beverage to start demand modeling. Users got hands-on with demand modeling and experienced incorporating external factors like GDP, CPI, and many more. There was interactive discussion in the room as we brainstormed which data sets they could use when they got back to the office, how they can leverage Demand Guru on other projects, and even different areas across their organization.

When you start to consider how many external factors impact our business, we are reminded of the importance of more accurate causal forecasting. With Demand Guru, you can accurately predict demand for the future, quickly access over 500,000 casual data factors, and perform what-if scenario modeling capability. This capability opens the door to a wide array of use cases for your business. Perhaps you are like Cummins who use demand modeling for annual strategic planning to increase confidence in their long-term decision-making process. Or Interceramic, who leverage demand modeling in market pricing which empowers their supply chain team when determining base prices and promotions. There are hundreds of use cases for demand modeling. Our jobs are not about reporting one number as a forecast back to the business, they’re about being able to explain the factors driving the number, how to analyze trends in your demand, show the impact of changes in the causal factors to demand, and bring this demand insight back to our design and decisioning process. This allows us to make smarter, more agile supply chain decisions.

Thank you to all who attended SummerCon! For those who didn’t get to join us this year, we’d like you to have the opportunity to start modeling your demand use cases. Send me an email if you’d like to learn more.