Modern Supply Chain Management
Topic: Demand Driven MRP
21st Century Supply Chains Require New Demand Driven Rules and Tools
A white paper by the Demand Driven Institute
April 2011
www.demanddriveninstitute.com
The Demand Driven Institute (DDI) was founded by Carol Ptak and Chad Smith, co‐authors of Orlicky’s
Material Requirements Planning, Third Revised Edition in order to proliferate and further develop demand driven strategy and tactics in industry to enable a company to transform from “push and promote” to
“position and pull.”
For more information about our mission and how you might get involved, please contact us at: info@demanddriveninstitute.com © copyright 2011 Chad Smith and Carol Ptak, all rights reserved
21st Century Supply Chains Require New Demand Driven Rules and Tools
Chad Smith and Carol Ptak
Globally supply chains are becoming more complex. Companies struggle with the increased difficulty to plan and manage. Consider this November 2010 survey from the Aberdeen Group: “86% of respondents indicate that their management team has asked them to find opportunities to improve their companies supply chain planning processes and 71% of respondents have indicated the same for supply chain technology improvement.” 1
What is more alarming is that most are missing the biggest opportunity for a real solution.
What are we missing about Supply Chain?
Today, too many people think of “supply chain” tools as Warehouse Management Systems
(WMS), Product lifecycle management (PLM) or logistics management packages. This is a huge mistake. What really drives supply chains?
The heart of any supply chain is an interconnected network of “islands” of manufacturing. At the heart of these islands is something called Materials Requirements Planning (MRP). MRP creates and connects the demand signals in the “archipelagos” that comprise most supply chains. A universal law in both manufacturing and supply chain is: All
21st Century Supply Chains Require New Demand Driven Rules and Tools
A white paper by the Demand Driven Institute
April 2011
www.demanddriveninstitute.com
The Demand Driven Institute (DDI) was founded by Carol Ptak and Chad Smith, co‐authors of Orlicky’s
Material Requirements Planning, Third Revised Edition in order to proliferate and further develop demand driven strategy and tactics in industry to enable a company to transform from “push and promote” to
“position and pull.”
For more information about our mission and how you might get involved, please contact us at: info@demanddriveninstitute.com © copyright 2011 Chad Smith and Carol Ptak, all rights reserved
21st Century Supply Chains Require New Demand Driven Rules and Tools
Chad Smith and Carol Ptak
Globally supply chains are becoming more complex. Companies struggle with the increased difficulty to plan and manage. Consider this November 2010 survey from the Aberdeen Group: “86% of respondents indicate that their management team has asked them to find opportunities to improve their companies supply chain planning processes and 71% of respondents have indicated the same for supply chain technology improvement.” 1
What is more alarming is that most are missing the biggest opportunity for a real solution.
What are we missing about Supply Chain?
Today, too many people think of “supply chain” tools as Warehouse Management Systems
(WMS), Product lifecycle management (PLM) or logistics management packages. This is a huge mistake. What really drives supply chains?
The heart of any supply chain is an interconnected network of “islands” of manufacturing. At the heart of these islands is something called Materials Requirements Planning (MRP). MRP creates and connects the demand signals in the “archipelagos” that comprise most supply chains. A universal law in both manufacturing and supply chain is: All