Members Gain Actionable Insights into Forecast Accuracy Potential

Atlanta, GAMay 14, 2013 — Chainalytics, a leading supply chain intelligence, analytics, and advisory services firm focused on enabling fact-based supply chain decisions, announced today that it has developed several innovative forecast accuracy metrics which help companies better understand their demand planning performance and potential. The new metrics are currently being employed for members of Chainalytics’ Sales & Operations Variability Consortium, or SOVC.

Since the SOVC launched in 2011, it has grown to include the U.S. operations of more than 30 business units, representing some of the world’s leading consumer product manufacturers. Chainalytics’ proprietary demand segmentation framework and model-based benchmarking methodologies have created an unparalleled analytical opportunity to understand item-location level forecast accuracy and bias. Using data that describes more than 300,000 distinct item-fulfillment location combinations, Chainalytics produces nearly 1,600 benchmarks that are reported quarterly by forecast lag at the demand segment level.

Chainalytics developed its segmentation framework to address a shortfall of traditional benchmarking – the disregard for the uniqueness of an individual business’ product portfolio and demand characteristics which drives their unique level of forecasting difficulty. Through its new Demand Forecastability Index, Chainalytics enables SOVC members to understand what their forecast accuracy should be given their unique demand mix. To help members set realistic improvement goals and targets, Chainalytics developed a measure of Potential Forecast Accuracy to demonstrate the opportunity to achieve best-in-segment performance at a granular level within their demand profile. This metric, and the corresponding best practices, identified that nearly half of the Consortium participants could improve their forecast accuracy by 8-13 percentage points.

“The value-creation opportunity delivered by SOVC has exceeded both our members’ and our own expectations over the last year,” said Jeff Metersky, vice president of Chainalytics’ new Sales, Inventory, and Operations Planning Practice. “With new members being added each month, we will continue to refine and enhance our approach to demand planning benchmarking and look for even more ways to help our clients address one of today’s biggest supply chain challenges.”

To further enhance its SOVC service offering, Chainalytics will introduce a web-based user portal in mid-2013 to enable easy access to reports as well as monthly member updates tracking their demand planning performance and Demand Forecastability Index. Later in 2013, Chainalytics plans to extend the current benchmarking model to global markets as well as launch additional industry verticals beyond consumer product goods.

About Chainalytics
Chainalytics is a recognized leader in supply chain intelligence, analytics, and advisory services. Through a unique combination of best practice knowledge, exclusive benchmarking research, and advanced decision sciences tools and techniques, Chainalytics empowers fact-based decision making in the areas of Supply Chain Design, SIOP (Sales, Inventory, and Operations Planning), Logistics Operations, Transportation, Service Supply Chain, and Packaging Optimization. Chainalytics targets enterprises with a high degree of complexity created by their unique combination of scale, variability, and geography. With locations in North America and Asia, Chainalytics serves companies globally in a borderless fashion.