You’ve heard about DDMRP, you’ve browsed the web, you’ve read testimonials, maybe you’ve taken a training course, and you tell yourself that it can make sense in your business.
So, why don’t we experiment live to see what happens?
One advantage of DDMRP is its simplicity: the calculation formulas are simple, you select a few items, extract data from the ERP, manipulate them in Excel, a little red, yellow and green, and off you go.
It doesn’t cost much, we put our intern to work, we’ll see what comes out of it, and if DDMRP is as magical as some people claim.
Perhaps you are a little further along in the process: you have contacted one of the software publishers that offer a DDMRP certified solution, and you are organizing a pilot for a few weeks on a limited perimeter.
Numerous companies have undertaken pilot schemes of this type in recent years, some with success, but other experiments have been mixed or have failed.
We also see several companies that have done a test with positive results, but remain stuck in the test and have difficulty moving into a deployment phase.
When such pilots are not conclusive it does not necessarily mean that DDMRP was not adapted to the company’s business flows. Feedback is accumulating, from all industry and distribution sectors, which demonstrates that when properly implemented, DDMRP delivers very substantial results. It is therefore probably the conditions under which the pilot was carried out that are to be questioned.
What are the success factors for a Demand Driven pilot?
Be clear on your stakes!
Some companies have embarked on a “test to see”, out of curiosity, but without being clear about the problems to be solved. If you do not have a problem, don’t look for a solution!…
What are the challenges facing your supply chain? What are the obstacles your teams are struggling with?
Service, flexibility, lead times, stocks, costs, stress: be clear about what you need to solve. Select your pilot perimeter according to this – it must be a scope on which you are suffering, and for which conventional approaches have not provided the solution.
In fact, you do not want to run a pilot, you want to transform your supply chain to make it more robust and agile. Your trial is not a trial: think of it as the first phase of a deployment.
At the end of your pilot, if it is conclusive, you will want to perpetuate it, roll it out on a wider scope and eventually on the whole company. Don’t let the enthusiasm of your teams slip away because at the end of the pilot there is no budget nor resources for deployment, which must be submitted for approval by management or shareholders, then we must select the software that will be adopted, etc. You are going to create a gap of several months and lose momentum.
This means that before any pilot you must plan and get approval for the next steps: and if by mistake it succeeds, how do you go from there? How do we organize the teams for deployment? Which IT solution? What deployment sequence? What budget?
If you have not defined the deployment plan, do not launch a pilot!
Cheap, OK, free, no!
Structurally, a DDMRP software project is not expensive, compared to most organizational and IT projects for the supply chain. It is not an ERP change, far from it…
However, the results are delivered quickly and ensure a fast payback. If you invest 50k€ and that allows you to reduce your stocks by 500k€ within a few months and to improve your customer service by 5%, the calculation is quickly done!
Of course, making a pilot allows to test an approach at a lower cost. However, it is an investment, because you will mobilize resources from your teams to work on this project rather than on other initiatives.
Do not run your pilot with Excel
You will mobilize resources to develop the macros, debug them, without the result being at the level of any of the solutions on the market. Using a proven and intuitive IT solution is a key factor in getting your teams to adopt the approach, focus on the process and deliver the results. In addition, feeding Excel or feeding DDMRP software from your ERP is the same effort: you will need the same data elements.
Invest in your pilot team
Carefully select the members of the pilot project team, invest in their training and coaching: they are the ones you will rely on for the subsequent deployment!
Design your model carefully and get help
DDMRP is simple but not simplistic. Your model for the pilot must be well designed, well dimensioned, supported by simulations, business processes must be consistent, etc. In many cases pilot failures are due to faulty design. Do not hesitate to call on experienced teams to help you, and it will help your teams become more competent for deployment.
The Demand Driven Technologies teams and our network of partners are at your disposal to help you succeed with your DDMRP pilot 1st deployment step!
If you are interested in learning more about our Demand Driven Supply Chain Software solutions feel free to contact us and see how DDMRP can improve your supply chain.