Business Objective
Our client is a global healthcare company, headquartered in the US.
Their Trade S&OP team needed to accurately forecast shipments that would help them in effective inventory management. This was required to be done for their diabetes care unit, specifically for high-selling glucose monitoring devices and test strips.
Challenges
- Identifying and treating outliers in historical shipments (purchase deals among wholesalers/retailers)
- Accounting for retailer-level differences in shipment frequencies in arriving at an overall plan
- Aligning model based forecasting results with quarterly financial targets for tie-outs
Solution Methodology
We built a trade forecasting tool that helps the planning manager accurately forecast at a product SKU, wholesaler/retailer customer level, rolled up to net shipment units and dollars among other inventory management related metrics.
Key Analytics Delivered:
- Detailed month-on-month shipment forecasts by each customer, at a product SKU level
- A ‘Forecast Manager’ view – that empowers and enables planning managers to:
- Align model forecasts with quarterly financial planning
- Simulate what-if scenarios – create, save and publish multiple forecasting scenarios, based on different days-on-hand and inventory target criteria
- Seamless monthly system refresh with updated forecast numbers based on latest actual numbers
- Customized BI/visualization reports which can be published to multiple users, sent as email notifications, etc.
Business Impact
- The shipments forecasting tool delivered an integrated forecasting solution with a monthly forecast error rate within +/-5% for power SKUs across customers, for the past year.
