Becoming Demand Driven

A prerequisite for becoming customer demand driven is to do effective planning before you get the customer order. Create the conditions so you can respond quickly to customer orders, often after the orders are received but before the product is finished. This process is called Postponement and it involves having the right capacity and materials available when a customer order arrives.

Two key processes make Postponement possible: Executive S&OP and Lean Manufacturing. Lean enables a company to make products quickly and make them right the first time. Executive S&OP provides a "window into the future" so that demand shifts can be seen early, in time to make supply side changes effectively and economically.

This is an excellent example of the blending of two very different processes, with the result that the whole is greater than the sum of the parts. Our book Building to Customer Demand covers Postponement in detail. You may have high-payback opportunities for Postponement in your company.