Demand management is concerned about developing a realistic forecast to support the S&OP process. However, demand planning goes beyond forecasting. In figure 8, the demand management process ensures that procedures are integrated for matching demand and supply. The demand management is divided into two categories, the strategic and operational process.
The concept of the strategic demand management process is similar to strategic planning discussed earlier. Strategic process is a system of policies and procedures necessary to capture and manage demand data to match demand with supply chain resources. Some of the activities in the strategic stage include developing strategy, determining data sources, choosing the best forecasting techniques, and developing metrics. These procedures are catered through implementing specific, operational level processes. Operational processes are the execution stage by which daily activities are performed and measured.
Figure 8. The demand management process. Source: Adopted from Keeley L. Croxton, Sebastian J. Garcia-Dastugue, Douglas M. Lambert, and Dale S. Rogers, “The Supply Chain Management Process,” The International Journal of Logistics Management, Vol. 12, No. 2 (2001), p.19.