On 18 May 2016, the Demand Driven Institute (DDI) announced that High Impact Coaching and Strategies’ supply chain management solution, TheONE, had been certified as DDMRP (Demand Driven Material Requirements Planning) compliant.
A short time ago, I had an opportunity to interview Sandy Goodwin, one of the founders and principals at High Impact Coaching and Strategies. He was also a key figure in the design, and guided the development, of TheONE software.
Goodwin told me that his firm “has a long history of delivering demand-driven factory and supply chain transformations.” Working mostly with global enterprises, Goodwin confirmed that “our… clients [are] saving millions of dollars” as a result of the software and demand-driven coaching we provide.
The Overcoming the Common Failures
When asked to come to the aid of these globally-involved companies, Sandy said, we found that virtually all “our clients were continually fighting against their MRP systems and inaccurate forecasts.” No matter how much these firms has spent on their enterprise-level demand management and planning systems—even several millions of dollars—they still found they were dissatisfied with the results in terms of supply chain and inventory management.
“After years of developing techniques” intended to “trick” MRP into delivering somewhat improved results, Goodwin and his team discovered “DDMRP, and found that the methodology was a perfect fit” for what they were trying to accomplish with their clients. They also grasped—almost immediately—the huge potential gains their clients could reap from implementing the DDMRP approach.
This discovery of DDMRP, of course, led to the development of TheONE. TheONE, Goodwin declared, “allows us to provide our clients with demand-driven supply chain software” that fully supports both “the tactical and strategic solutions we have been implementing [in] operational supply chain environments for over a decade.”
Resistance to Change
Despite DDMRP’s proven track records for delivering results like these, getting executives and managers to even consider something other than traditional MRP is still an uphill battle according to Goodwin:
- Inventory reductions of up to 65 percent (the average is around 40 percent)
- On-time delivery rates up to 100 percent
- Improvements in inventory turns up to 400 percent
- Lead-time reductions up to 80 percent
- Inventory obsolescence reduced up to 90 percent
Amazingly, “even though every company” with which Goodwin’s firm has an opportunity to speak “accepts the serious shortcomings of [traditional] MRP, most are reluctant… to make the leap of faith” required to “step into the 21st century, and embrace [the] demand-driven planning methodology.”
How DDMRP and TheONE Deliver Supply Chain Results
How can DDMRP principles—operating in TheONE solution—deliver such dramatic results with consistency and reliability?
Goodwin answers that question with confidence, saying that “TheONE [first] specifies and [then dynamically] manages optimal inventory levels.” The software can identify areas where inventory reductions may be safely made while, at the same time, also identifying those points in the supply chain where additional investments in inventory will better support the flow required for improvements in return on investment (ROI).
“The full integration with our clients’ ERP system[s],” Goodwin adds, “TheONE has full visibility of [both] demand and supply, and [thus is able to] dynamically adjust buffer levels to ensure inventory is aligned to the requirements of the customer.”
“The daily flex in buffer size,” has proven effective time after time, says Goodwin, in reducing or eliminating “demand distortion” and improves “the responsiveness of the supply network to support changing demand requirements.”
The key to success is “end-to-end visibility” and “a distinct transition away from reliance on the inaccurate forecast[s]” of the past. DDMRP, when properly supported by effective technologies such as TheONE, “senses and shapes strategic inventory positioning within the entire supply chain—from retail and distribution to manufacturing and multi-tiered suppliers,” according to Goodwin. That is what makes it so highly effective.
Are you and your supply chain still struggling to deliver the kinds of long-lasting results you really desire? Is sustainable ROI elusive? Are you, too, plagued by inaccurate forecasts and an MRP system that has driven your supply chain and planning managers to work-around found in spreadsheets, Access databases, and other ad hoc strategies and tactics?
Maybe it’s time you consider becoming truly demand-driven (which does not mean make-to-order). Maybe it’s time to start making more money—in as little as eight weeks.
We can help you move in the right direction—finally.