Thematic Analysis on Demand Management Assignment

Thematic Analysis on Demand
Management
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Contents
Introduction................................................................................................................................2
Demand management.................................................................................................................2
The role of demand management in supply chain agility (SCA)...............................................2
Demand management strategies for public and private sector organisations............................3
Demand management model......................................................................................................4
Conclusion..................................................................................................................................7
Reference list..............................................................................................................................8
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Introduction
In this report a discussion is going to be done regarding the topic of demand management.
Several aspects of the demand management are going to be touched in this report. The
relation of demand management with the supply chain agility is going to be done. The
methods that are used by the public and private sector in demand management have also been
done in the report. Some of the demand management models has also been attempted to be
evaluated in the report.
Demand management
As par Saad et al. (2012) the demand management is basically the entire aspect of making
forecast regarding the demand, planning for the demand and managing the demand for
products and services. Demand management can be estimated regarding an entire economy, a
particular industry or a particular firm and the products and service within it. to ensure that
demand management has been done it has be to ensured that the demand of the customer can
be understood anticipated and influenced for a service and products that are being taken up in
this case.
The role of demand management in supply chain agility (SCA)
Research has been conducted by David M. Gilgor regarding the role of demand in supply
chain agility. The research has been conducted from 1991 to 2013 on manufacturing
organisations. The several elements of supply chain agility or SCA has been identified in this
case.
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The key findings of this article are that the agility frameworks that are followed in case of
supply chain are often made on the assumption that the demand has been a known factor. It is
not possible to make a holistic framework without knowing the actual amount of demand.
This journal has also found that only ensuring that the manufacturing, procurement or
distribution and ensuring flexibility in this is often not enough to achieve agility. There is an
increasing need is demand and supply integration which is only possible through effective
forecasting and demand management.
There are several benefits of demand management in actual management of organisation.
First of all is that it is possible for an organisation to achieve competitive advantage in
difficult market situation. Demand management also contributes in other fields like
knowledge management (Stevenson and Hojati 2007). Knowledge management can help in
forming a demand supply integration which is of practical benefit for an organisation.
Demand management strategies for public and private sector
organisations
The demand management strategy is the method that is used by an organisation to manage
the level of demand in the market. There are different strategies that are adopted by
government organisations and private organisation to manage the level of demand from the
customer.
Public sector organisations: the chief methods that are used by the government to change
the demand in the market are the interest rate. The changing of the interest rate is done by the
government as par the monetary policy. There are two types of monetary policy the
expansionary monetary policy that is used by the government is done to increase the demand
in the market and the contraction monetary policy is used by the government to reduce the
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demand in the market as stated by Mohsenian-Rad et al. (2010). There are some government
organisations that meet the excess demand by outsourcing some of its function to the private
organisations. The government is responsible for the management of the aggregate demand in
the market. This is done by the government to avoid events like recession which is a result of
lack of effective demand management. The inflation rate in a country is also influenced by
the demand in the economy according to Acharya (2013). The government is also responsible
for the controlling of the rate of inflation. There are other factors that are controlled by the
government to ensure the limiting of the demand that is the rate tax and public expenditure.
Tax can be controlled by the government directly the public expenditure can also be
controlled by the government indirectly as opined by Tcherneva (2012). However the
government is reducing its responsibility in controlling of demand. The macroeconomic
demand management responsibility has been taken up by the independent central banks
within an economy.
Private sector organisation: in private sector organisation the demand for the products is
mostly managed by a simple policy. When the supply is more than the demand the price is
kept at a profitable rate. But when the demand is more than supply the demand is managed by
the increase in price. The private sector organisation also managed the demand by effective
forecasting as stated in the work of Lambert and Cooper (2000). There are other measures
that are used by private organisations like time fences. In private sector organisation time
becomes a keen issue in increasing the demand. The time fence serves a point of decision for
private organisations. The work of Rexhausen et al. (2012) shows that it can be divided in 3
parts the future planning zone, trading zone and firm zone. The future planning zone is when
the supply is manipulated to meet the demand. The trading zone is when the demand is
manipulated to ensure that it is at par with the production and the firm zone is when the
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procurement supply is matched by the demand by manipulating it as stated by Priem and
Swink (2012).
Demand management model
Fig 1 Demand Management
Source [Priem and Swink 2012]
Demand management can be done by using certain models. First it is of importance to study
the pattern of demand as par Priem and Swink (2012). The service belt of the organisation
has to be studied as par the business process and the service process scheduling the delivery
pattern of the organisation. A capacity management plan has to be developed in case the
increase in demand is a good sign and there is an essential need of fulfilling it. As par Warren
(2014) in case it is important for the organisation to make sure that there are certain types of
changes that are to be conducted in the point of the change in demand than incentives and
penalties can be applied to make the necessary changes.
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Fig 2 Forcasting model
Source [Stadtler 2015]
There are several methods that can be used by an organisation to forecast the demand which
has been shown in this model. The methods can be classified in primarily three parts the
survey method, statistical method and other methods. There are two parts in which the survey
method can be applied first is by the estimate of the intention of the purchase and the second
method is by reports that are generated by the sales forces as opined by Jaipuria and
Mahapatra (2014). The intention of the buyer can be gauges either through census or sample.
The statistical method is another key aspect in which forecasting is done to control the
demand in the market. First statistical technique that is used in making forecast involves the
trend projection technique. This technique identifies the patterns that are present in the
market regarding the demand of a particular product. The second common technique that is
used is the barometric technique. The third method is the simulation method which replicates
the behaviour of the market and thus forecast the possible demand. The last method is the
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correlation and regression techniques as shown in the work of Acar and Gardner Jr (2012).
This technique associates the demand with other factors and predicts the demand by
observing the associated incidences.
Some other methods that are used are qualitative means which has lesser amount of accuracy
rate like expert opinion, test marketing, experiments and judgemental approach. These
techniques are also sometimes applied in the market to estimate the possible demand (Russell
and Taylor-Iii 2008). These methods are less systematic in comparison to the survey and
statistical approach that is used.
Conclusion
In conclusion it can be said that demand management is one of the essential element in any
demand and supply process. The demand management is interrelated with demand and
supply chain in more than one ways. The demand management technique used by the public
and the private organisation by using different techniques. Forecasting of demand is one of
the key processes of demand management in operation of an organisation. There are other
means as well that are used by the organisation to meet the demand. As forecasting plays a
vital role there are several ways in which the forecasting is done in organised sectors. The
two key method of forecasting is survey method and statistical method.
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Reference list
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of Maryland mimeo.
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reduce bullwhip effect in supply chains. Expert Systems with Applications, 41(5),
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5. Lambert, D.M. and Cooper, M.C., 2000. Issues in supply chain
management. Industrial marketing management, 29(1), pp.65-83.
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management. Journal of Supply Chain Management, 48(2), pp.7-13.
9. Rexhausen, D., Pibernik, R. and Kaiser, G., 2012. Customer-facing supply chain
practices—The impact of demand and distribution management on supply chain
success. Journal of Operations Management, 30(4), pp.269-281.
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10. Russell, R.S. and Taylor-Iii, B.W., 2008. Operations management along the supply
chain. John Wiley & Sons.
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smart grid: An overview of microgrid systems, demand-side management, and smart
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