Demand and event planning with Microsoft Dynamics
Updated: September 14, 2004
Planning production involves significant costs. Just think how much time and money people across your organization use to buy materials, get them delivered, store them, manufacture your product, store it again, and finally ship it. This article looks at three supply chain management tools that give your people rich insight into your business processes, enabling them to make intelligent and timely decisions that make your production and distribution business more profitable.
1. Demand Planning: What Will Your Customers Want Tomorrow?
Demand planning is about looking back at your sales data to estimate future demand with a known degree of accuracy. It serves as a foundation for all other business planning activities, such as production, purchasing, resource, and logistics planning.
"Many small and midsize manufacturers are looking to formalize the workflow and methods of their planning," says Eva Sachse, a product manager for Microsoft Dynamics. "To handle their demand planning today, they might have an [Microsoft] Excel spreadsheet stored on a server, which five account managers have to share. They can't all work at the same time, and nobody knows who did what and when."
Microsoft Dynamics delivers demand planning capabilities, which gives a company’s decision makers more control over the workflow and allows them to base their decisions on historical data, as well as apply other influential factors, such as economic indicators and promotions.
New demand planning functionality from Microsoft Dynamics will allow people to continue working with a tool they are already familiar with, Microsoft Office Excel. Only now, Excel will be integrated with their enterprise resource planning (ERP) solution, allowing account managers working in the field, for example, to upload their forecasts directly into the ERP system. In addition to being integrated to it, the demand planning functionality in the ERP system will have a similar feel to Excel.
2. Event Management: Are You Prepared for the Unexpected?
Event management refers to detecting and alerting the user when something unforeseen happens. The system automatically recognizes and responds to events that could have an impact on business. For instance, if your supplier of raw materials is unexpectedly late on a shipment, an e-mail or SMS is automatically sent to your customers informing them about the delay.
"This ensures that no significant business event goes unnoticed by managers and helps to prevent situations that could be avoided, such as lost orders, delayed parts, or unhappy customers," says independent IT analyst Stewart McKie.
Independent software vendor Categoric currently offers event management tools for Microsoft Dynamics AX, and Microsoft plans to build an event management solution that will also integrate to Microsoft Dynamics NAV and Microsoft Dynamics GP later this fiscal year.
3. Radio Frequency Identification: Have You Talked to Your Products Today?
Radio frequency identification (RFID) technology combines the benefits of silicon chips and radio frequencies and has the potential to provide an unprecedented level of product visibility and process efficiency across the supply chain.
Unlike traditional bar code readers, RFID chips will be in continuous two-way communication with the business management software system. Products don't need to be scanned manually; all the relevant information is read from the items automatically.
Bjarne Schøn, director of supply chain at Microsoft Dynamics, draws an example of how RFID technology can help manufacturers from his own days as a logistics manager:
"When I worked as a manufacturer, one of my problems was that our vendors in the Far East would make changes without informing us. If they ran out of our standard 24-piece carton, they'd load a 36-piece carton. It would arrive at our warehouse in Sweden, and we might not notice the change.
"Then, when we shipped to our customers, the system would assume there were 24 items, but in reality we'd send 36. With RFID technology, the exact and correct information would be immediately uploaded into your ERP system because the moment the truck pulls into the warehouse, the products start talking to your ERP system."
Read more about RFID technology and the plans Microsoft has to support it: The Little Chip That Will Change Your Supply Chain Forever.
Keep It Simple
Demand planning, event management, and RFID technology all play a part in the plans Microsoft has to provide supply chain management functionality that can help manufacturers plan more efficiently.
The idea is to leverage popular Microsoft Office tools and bring supply chain functionality into these so customers can use their existing systems seamlessly and efficiently.
"We want to give you answers that make sense via software that you're comfortable with," says Schøn. "We also want to show you how the answer was arrived at, so that you can explain the logic behind your decisions to everybody else."
