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Forecasting for Success:

Integrating Sales and Demand Planning

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Forecasting for Success:

Integrating Sales and Demand Planning
April 7, 2016

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Manufacturings Future:
Going Beyond-theProduct
Tony Kratovil
Industry Director
Manufacturing & Automotive

A Diversity of Manufacturing Customers

Driven by Customer Success

Heavy Industrials

Durable Goods

Diversified Industrials

Automotive

Connectivity Revolution in Manufacturing

Connectivity
Automation
Mass Production
Mechanization

1700s

1900s

1970s

Today

Connectivity Drives Demand for Deeper Engagement

More Empowered

New Experience Bar

Connected 24x7, mobile-first, social,

enabled by data

Demand: Engagement Beyond the Product

Always-on

Personalized

Smart-enabled

Relationship

Engagement

Services

Going Beyond-the-Product Needs Digitization at 3 Levels

Front-office Engagement
1:1, data-driven, proactive
marketing, sales, service

Value Chain Alignment

Real-time collaboration
around the customer

Agile Innovation
Real-time connected
product insight driving
new services

Manufacturers Invested in Systems of Record

Digitizes operations, not engagement

61%

rely on spreadsheets
to track customer
data

Systems of

Record

ERP

EDW

Internal Focus

MES

Logistics

Demand
Planning

HR

Operations Supply Chain Infrastructure Procurement

Source: 2016 Connected Manufacturing Service Report

Manufacturers Need a
System of Engagement

87%

want to reimagine
service with digital
engagement

Systems of

Engagement

Cloud

Mobile

Systems of

Record

ERP

EDW

MES

Logistics

Social

Data
Science

Demand
Planning

Internet of
Things

HR

Roadmap to Go Beyond-the-Product

Digitize the Front Office

Inquire-to-Order
Personalize & accelerate
customer acquisition

Digitize Alignment

Service Excellence
Expedite 1:1
service everywhere

Unlock ERP
Drive real-time
global alignment

Customer Success Platform for Manufacturing

Cloud

Mobile Social Data Science

IoT

Digitize Innovation
Connected Products
Predict & personalize with
real-time insight

Digitize the Front Office

Digitize Alignment

Digitize Innovation

Unlock ERP
Align disconnected value chain globally
Unlock Data
Integrate legacy data into a real-time, extensible, standards-based,
scalable cloud platform

Mobile-ize Insight
Lightning development UI to build employee & partner apps across HR,
Operations, PLM, Quality, Inventory Management

Align Everyone
Mobile collaboration, built-in analytics & 3600 customer view, driven by
CRM & ERP data, for everyone to align around the customer

What is a Fullforce Solution

Partner Industry Expertise + proven success at anchor customer + Salesforce
Customer Success Platform = Fullforce Solution
Transformational Industry Use Cases

High Impact, Unique Horizontal Use Cases

& Focus Products

Improving Sales Forecast Accuracy

INCORPORATING CUSTOMER SALES
FORECASTS INTO S&OP
2016

Manufacturers have struggled to accurately forecast sales for decades. They lose
revenue and carry excess inventory. It is a very expensive issue

C O N S E Q U E N C E S O F H AV I N G P O O R S A L E S
F O R E C A S T I N G DATA F O R M A N U FA C T U R E R S

WHY THE LACK OF

C O N F I D E N C E I N DATA ?

Historically inaccurate

Not timely

Too many versions/ spreadsheets

Inaccurate/incomplete forecast

ACCURATE SALES
FORECASTS
REVENUE 10%-15%
Lower level of on-hand inventory
(20% vs. 35%) as a % of total sales
Less unfulfilled backlog (10% vs.
14%)
Reduced level of obsolete inventory
(less than half )
Source: Answering the Sales Forecasting Challenge For Manufacturers by Right90 May 2010)

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Three issues are pervasive. The first is supplementing (predicted) historical and
market data with (actual) input from customers and distributors
C U S TO M E R I N P U T S R E P R E S E N T
I N S I G H T I N TO T R U E D E M A N D

What tools and processes help you

capture forward looking customer
demand?

Extrapolative
Demand

Statistical
Forecast

Forecast
Accuracy
Judgmental
Test

Customer
Inputs

H O W D O YO U D O T H I S TO DAY ?

What information do you gather to

forecast future demand for products
and services?
How often do you review demand
forecasts with customers?
Is there a process for measuring
customer forecast accuracy?

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Issue two: Typical sales forecasting/demand management is a long, manual process

supported by spreadsheets. It cannot support timely changes and updates

T Y P I C A L S A L E S A N D D E M A N D P L A N N I N G P R O C E S S C R E AT E F O R E C A S T S L A C K I N G
INTEGRITY AND THUS CONFIDENCE

Done w/o customer

input or market data

Limited Controls =
poor data

Manual and time

consuming

Compensates for
poor data

Sales Rep and

Customer develop 424 month demand
forecast

Sales Rep uses Excel

template to record
forecast

The Demand Team

consolidates
templates

The Demand adjusts

data, models
scenarios and
calculate customer
volumes

4-24 month
Component forecast
sent to suppliers

The MRP process

translates volumes to
the Build List and
component parts

Demand Team output

used to create
financial forecast

Overcompensation=
excess inventory

Based on
inaccurate data

Based on
inaccurate data

Customer
sends 0-4
month
delivery
schedule
weekly

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

The third issue is incomplete data that lacks the details that demand planning teams
need. Imagine if there were a solution that addressed all three

DATA A C C U R A C Y + $ 0 0 0 K I N S AV I N G S + 6 0 % R E D U C T I O N I N O R D E R E N T RY T I M E

ACCURATE FORECASTS
REVENUE
Lower level of on-hand
inventory
Less unfulfilled backlog
Reduced level of
obsolete inventory

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Key factor for success #1

Allow those that have a critical sales forecasting role to use the same system
SALES
R E P R E S E N TAT I V E

DISTRIBUTER

DEMAND TEAM

From the Opportunity

View the sales forecast

Global forecast lock

Create sales forecast

Update the sales

forecast

Ability to update
forecast

Add notes and

comments

Global Unlock

Overview of forecast
page
Transfer Volume to
Build Lists
Control distributor
access

Add notes and submit

the forecast

Add notes and

comments

Update sales forecast

Add notes and submit
the sales forecast

4/7/2016

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Key factor for success #2

Make it easy to provide information for all key players involved
COLLECT INPUT FROM SALES AND SALES
OPS TEAMS

ALLOW DEMAND TEAMS

ACCESS/CONTROL

SUPPORT UPDATES TO MULTIPLE ACCOUNTS

PROVIDE CONTEXT USING ERP DATA

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Key Factor for success #3

Allow sales/distributer teams to forecast based on the data they have
C A L C U L AT E C O M P O N E N T Q UA N T I T I E S F R O M P R O D U C T F O R E C A S T S

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Successful sales forecasting solutions allow teams to provide accurate customer

forecasts when supply agreements are signed and as demand is updated
MILLIONS LESS THAN
E Q U I VA L E N T E R P A P P S

S A L E S & D E M A N D T E A M S C O L L A B O R AT E O N
SALES FORECASTS WITH FULL VISBILITY

Captures high level product forecasts and maps

them to component parts

Ease of use: Captures forecast data

from sales, using a sales system

Aggregates sales and market forecast data while

providing sales reps context on actuals from ERP
systems to improve accuracy

Scales to complex sales

organizations with geographical
territories, global clients

Supports integrated business planning between

sales and demand teams

Configurable to support your

forecasting measures

Highlights shifts in demand using near real-time

information

Built on the Sales Cloud, App Cloud

and the Communities Cloud

WE ADDRESS THE CHALLENGES THAT

RESULT IN POOR DATA INTEGRITY

Inaccurate forecast, Lack of details

Incomplete forecast that are not timely

Too many versions/ spreadsheets

4/7/2016

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

Fortune 100 Global Equipment Manufacturer increased operating income by 7.5%

KEY BENEFITS

BUSINESS SITUATION

Our client, a global equipment manufacturer, sells products

across distribution channels (OEM Stores, Distributors etc.)

Both Manufacturing and supply chain organizations had limited

visibility to ensure right products were manufactured and
delivered to its customers

CHALLENGE

Inaccurate short term sales forecasts were resulting in inaccurate

demand and excess inventory

Existing forecasting process was manual, supported by

spreadsheets with data and version control issues. Collected data
sets were hard to manage given complex catalogs across
industries

KEY ACTIVITIES AND OUTCOMES

Enabled Short Term Forecasting (STF) monthly for

Acumen Solutions conducted blueprint and vision sessions with

executives to define current and target business
Acumen Solutions delivered role based solution to manage
demand cycle with formal notification cycles and shorten order
entry

up to 27 months ahead
Long Term Forecasting (LTF) annually for up to 10
years
Data on Actuals, Orders and Business Plan for -12
months to +27

2015 Acumen Solutions. All Rights Reserved.

www.acumensolutions.com

10

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