EOQ, RIP? The Decline and Fall of a Great Idea

According to most sources, the concept of economic order quantity (EOQ) was developed in 1913 or 1914. That means we're observing its centennial. Happy birthday, EOQ!

In most cases, a 100th anniversary would call for a celebration. In this case, though, I believe we should mark the centennial of EOQ by putting it to rest once and for all.

Don't get me wrong: EOQ has served a…

By all means use forecasting time fences. And by all means violate your time fences.

A time fence is a defined period in which the forecast should not be changed. An item's forecasting time fence often mirrors the item's planning or sourcing lead time. If it takes two months from when an item is ordered to when it's received into inventory, there's logic in not changing the forecast within that two-month period, since a change to the forecast will have no impact on the item's availability.…

Making the Leap: Why Move from Spreadsheets to Demand Planning Software?

Your spreadsheets seem to be doing everything you ask of them. Over the years, you’ve customized and linked them so that they’ll spit out the numbers you need, when you need them. Sure, the presentation value of a spreadsheet isn’t so great, but….at least you know what you’re getting.

Why, then, should you even consider switching from spreadsheets to software? What can demand planning software…

Achieving Supply Chain Excellence: Your Journey Forward (Part 2 of 2)

In my previous post, I talked about the supply chain management journey and the obstacles and opportunities it brings. I also promised I’d tell you what excellence looks like, and what (and whom) it will take to get your supply chain process to that point.

For starters, Gartner has identified five levels of supply chain maturity: React, Anticipate, Integrate, Collaborate, and Orchestrate.…

Achieving Supply Chain Excellence: Your Journey Forward (Part 1 of 2)

We’ve come a long way in supply chain management.

Remember when we were still relying on ERP or point solutions that ran on mainframe solutions? (That may all seem laughably out-of-date today, but it was a big step forward at the time.)

Later, we moved on to SCM solutions that ran in a client/server configuration. Today, the journey continues with cloud SCM solutions.

Every…