DDMRP, which is also known as Demand Driven Requirements Planning is an innovative method available to plan both inventories as well as materials. This can provide a large number of benefits to a company. That’s because a company that adhere to DDMRP will be able to offer products to the market and cater the specific requirements that exist in it. In the meantime, it is also possible to make better actions and decisions at the time of planning as well.
Five components of DDMRP
When you deep dive and take a look at Demand Driven Requirements Planning, you will be able to discover five main components in it. These are sequential components. This sequence and the relationship that exist in between the element refers to position, pull and protection.
Here’s a quick overview of the five components:
– Strategic inventory positioning
This is where you come up with the decision to decouple the points that are placed.
– Buffer profile and levels
When it comes to buffer profiles and levels, you can figure out the level of protection that is associated with the decoupling points.
– Dynamic adjustments
Dynamic adjustments clearly explain how the level of protection offered will flex up or flex down, depending on market changes, operating parameters or known events that will take place in the future.
– Demand driven planning
This is the process where the supply orders will be generated. It includes manufacturing orders, purchase orders and stock transfer orders.
– Collaborative and visible execution
This process allows the DDMRP system to take better control over the open supply orders that are available.
What are the benefits associated with DDMRP
After the implementation of Demand Driven Requirements Planning, it is possible for a company to experience a range of benefits. One of the most prominent benefits out of them is the ability to improve customer service offered. That’s because the users will be able to receive almost 100% on-time fill rate performance.
Lead time compression is another benefit that DDMRP can offer. Companies that exist in multiple industries will be able to experience the benefits that come along with it. It can also provide much-needed support and assistance with ensuring the right size of inventory. This can be done while ensuring maximum customer satisfaction.
As a planner, you will be able to identify the priorities ahead of time. In fact, DDMRP can provide you with an intuitive and a simple plan to figure out the priorities. As a result, you can stay away from fighting against the conflicting messages associated with MRP.
On top of all the benefits, companies that implement DDMRP can reduce the overall supply chain cost by a considerable amount. The costs that are associated with false signals and expedite activities can be eliminated massively. This includes the costs linked with cross ships, partial ships, and fast freight and schedule break-ins as well.
It is worthy to get a Demand Driven Requirements Planning strategy implemented within your business as well. Make sure that you get the required knowledge and implement this to experience all the benefits that come along with it.