Learn how statistical forecasting, consensus planning, and lifecycle management work together with APS in demand planning for capacity-based schedules.
Demand planning and sales forecasting help manufacturers estimate customer demand so they can align materials, production capacity, and distribution. Done well, it reduces inventory, cuts waste and improves service levels—especially when it’s connected to advanced planning and scheduling (APS). This overview is designed for demand planners, S&OP leaders, and operations managers in manufacturing who need to connect demand planning with capacity-based production schedules.
What Is Demand Planning?Demand planning is the process of estimating future customer demand so manufacturers can align materials, production capacity, and inventory levels. It combines historical data, statistical forecasting, and cross-functional input to create a demand plan that production, supply chain, and finance teams can execute together. This includes various areas of production such as raw materials, production capacity, distribution, and others. Therefore, demand planning plays a very important and strategic role within production facilities and can aid production through cutting inventory holding costs, eliminating waste, and allowing your operation to become much more efficient. Along with the benefits of demand planning, there are aspects to consider within demand planning.
These aspects of demand planning include the following:
Demand planning is rarely owned by a single department. Your demand planning tool should support consensus planning so sales, operations, finance, and supply chain can all contribute to a single, agreed-upon plan. Capturing this cross-functional input helps align assumptions and reduces surprises later in the process.
Planning based on the product lifecycle is complex but critical. Demand planning must account for new product introductions, end-of-life items, and situations where one product is replaced by one or more successors. Product substitution rules should be a key part of lifecycle management so demand is smoothly transitioned without disrupting production or service levels.
Advanced planning and scheduling (APS) software takes your demand plans and turns them into realistic, finite-capacity production schedules. Instead of treating demand as a simple volume target, APS respects resource, material, and sequencing constraints so you can improve efficiency, protect service levels, and reduce firefighting on the shop floor. APS can respond to rapidly changing demand by using real-time visibility and deeper insight into your supply chain.
Along with demand planning, there are other features and capabilities within APS such as:
Quickly turn your operation into a gold mine through implementation of advanced planning and scheduling software!
Video: Using PlanetTogether APS to Turn Demand Plans into Capacity-Based Schedules
In this video, we show how PlanetTogether Advanced Planning and Scheduling (APS) helps manufacturers turn demand plans into realistic, capacity-based production schedules. See how planners visualize resource load, align capacity with forecasts, and avoid overloading bottlenecks or creating unnecessary inventory.
Demand planning brings together statistical forecasting, consensus planning, and lifecycle management to estimate what customers will need — but even the best forecasting model can’t control every surprise in the market. What does make the difference is how your planners respond and which levers they focus on.
Download our one-page “Demand Planners: What They Can and Can’t Control” infographic to help your team:
Use it as a quick alignment tool across departments so everyone understands where demand planning ends, where advanced planning and scheduling begins, and how both work together.
The main aspects of demand planning are statistical forecasting, consensus planning, and lifecycle management. Together, they help manufacturers estimate future demand and align materials, capacity, and inventory with customer needs.
Demand forecasting uses historical data and statistical models to predict future demand. Demand planning goes further by combining forecasts with cross-functional input and lifecycle decisions to create an agreed plan that production, supply chain, and finance can execute.
Effective demand planning reduces stockouts, excess inventory, and last-minute expediting. It gives manufacturers a clearer view of what customers will need so they can schedule production and purchasing more efficiently.
APS software converts demand plans into capacity-based production schedules that account for real-world constraints such as machine availability, changeovers, and material availability. It also provides what-if scenarios and visual schedules that help teams align on realistic plans.
Understanding the advantages of distribution requirements planning (DRP) is essential when attempting to optimize production within your operation.
How do we improve demand planning? These tips on how to improve demand planning can take your demand planning to the next level.
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