Sometimes things are not always what they seem or how you imagined them to be. Making my start in demand planning a few years back, there were some important lessons that I had to learn. The following are 5 lessons, or ‘revelations’, that came to me while on the job that would make me a better Demand Planner.

1. Not Everyone Thinks Like Me

There is a tendency to believe that everyone is just like you are, and they think like you do. I admit I used to fall into that mental trap myself. I am a very analytical, logical person and, when starting in forecasting, I thought everything would be about presenting numbers. Numbers represent facts and that’s pretty cut and dry, right? Turns out not everyone understands what I do, or even cares about it.  They are not impressed by the models I use, correlations I found or that my mean absolute percentage error is better than average.

To do my job better I needed to start thinking like a salesperson, supply planner and marketing professional.

But they are impressed by how the insights I provide into what may occur impact them and why things are occurring now. To do my job better I needed to start thinking like a salesperson, supply planner, marketing professional, and even executive management. I needed to learn that not only do people not think like me, they’re also not interested in the technical aspects of my job – they just need the information that is relevant to them and helps them do their jobs better.

2. Numbers Are Not As important As Results

I am not just referring to metrics and measuring accuracy. While those are important and we should measure the results of our forecasts, I have learned it is even more important your forecast has a purpose. I remember being proud of a monthly forecast I was creating with pretty good accuracy one-month out only to find that manufacturing wasn’t even using my numbers.

They needed weekly forecasts and an outlook for what was going to happen sixty days from now. We can create the best, almost perfect, forecast but unless we are delivering what the company needs, when they need it, and in the right format – the results are meaningless. I needed to go beyond the numbers and adapt to who is using my forecast so they actually added value to the business.

3. It Is Not What You Know But Who You Know

Coming into my first forecasting role I started learning statistical models and analytics and even some machine learning. I had a lofty goal of creating the ultimate forecasting model that would be nearly perfect.

What I learned the hard way was that my model never predicted the new marketing campaign we were getting ready to start, the customer that was closing just because he decided to retire, or the product that sales incentivized with a contest last month. It turned out that what was better than my complex models were simpler models with more collaborative inputs.

4. It Is Not Always Our Fault

What I have discovered through developing and presenting forecasts is not that the forecasts are always wrong, rather the users don’t always understand what you are presenting. Using a weather forecasting analogy, if I was to just forecast it was going to be between 60- and 80-degrees Fahrenheit, it would not be hard to be accurate. Forecasting that it will be exactly 77 degrees is a lot trickier.

Accept uncertainty as fact of life, and then work to manage that uncertainty.

People generally look for a number instead of a range and no matter how often I give them a range, they still only wanted a number so that’s what I had to provide.  The lesson I learned here as a Demand Planner was not that my forecasts were rarely going to be accurate. And, instead of perceiving that as a failing, to accept uncertainty as fact of life, and then work to manage that uncertainty.

5. Demand Planning Is Art & Science

Imagine this: I’m putting my final touches on this month’s forecast and I’m adding in a promotion we are going to run. Marketing thinks it may add 10% while Sales thinks only 6%.  After detailed analysis behind the scenes and a little bit of voodoo, I add an 8% lift. Not because I am lazy or fully trust Sales and Marketing and just go with an average, but there is a lot of this that goes into every month’s forecast.

As a Demand Planner, I am managing assumptions more than I am managing a black box.

I think the biggest lesson out of all of these that I have learned as a Demand Planner is that I am managing assumptions more than I am managing a black box or magic wand. Foundationally, what I do is science-based but I have found there is just as much art to it as well. It is understanding how to communicate and ensure my forecast is being utilized. It is working with others and planning for what the number is but also what to do when the number is not exactly that. It is building a statistical baseline and sometimes even using some judgement to develop the best demand plan possible.