Over the course of writing “Insights” I have periodically discussed aspects of my research into Demand Management (DM), defined as “the optimized matching of supply and demand over time”—with matching occurring during planning and between planning cycles. The processes previously covered included Customer Service Segmentation and tactical Supply-Demand planning, also termed Sales and Operations Planning (S&OP).
Now it’s time to discuss my favorite of the three DM processes: Order Promising and Fulfillment (OP&F). OP&F is important because it occurs following the moment-of-truth for supply chain managers—when a customer expresses an interest in placing an order and generates revenue.
Doing OP&F accurately and optimally involves making a promise to a customer based on tactical supply-demand plans and on the customer expectations established from services offered to the customer’s segment. The OP&F process brings together all of the DM processes in an integrative fashion, yielding the greatest benefits.