SAS and Vlerick join forces to enhance decision-making
Improving the forecasting process
"We consider Vlerick a true research partner in our constant quest to better understand our clients’ business processes and needs so as to enhance our solutions and services,” says Ivy Vanderheyden, Marketing Director at SAS BeLux. Last year the company renewed its Prime Foundation Partnership with us, sponsoring the Vlerick Forecasting Research Centre. Ann Vereecke, Professor of Operations and Supply Chain Management, and Karlien Vanderheyden, Professor of Organisational Behaviour, are closely involved in the Centre. Together with Ivy, they take stock of what has been achieved so far and look ahead to the coming years.
Ann sketches the broader context of the partnership: “Nowadays there are plenty of sophisticated tools available to analyse, interpret and extract value from the ever-larger volume of data available. So the question is: where does that leave human judgement or expertise? Or rather, when and how can decision-making be improved by combining analytical tools or models and human judgement?”
This partnership’s research specifically focuses on forecasting, an important aspect of supply chain management. Ann again: “The more accurate your sales forecast, the better your production planning and inventory management and the more efficient and effective your supply chain.”
How mature is your forecasting process?
“Most companies want to improve their forecasting process and accuracy, but before you can improve, you need to establish your current performance and identify best practices,” explains Karlien. “In the past year we’ve developed a forecasting maturity assessment tool that enables companies to determine to what extent they apply best practices in forecasting and to identify opportunities for improving their forecasting process. Interestingly, relatively little research has been done in this area to date and as far as we know our maturity model is the first of its kind.”
When do one and one make three?
Over the next couple of years the team wants to gather as much in-depth information as possible in order to determine the impact of human judgement, or expert adjustments, on forecasting. Karlien: “We want to analyse if and when human adjustments actually improve analytical forecasts. Are large modifications better than smaller ones? Does forecasting accuracy improve if forecasters have to justify their adjustments? What is the impact of a forecaster’s experience or cognitive style? Does human judgement have more added value for innovative products with volatile demand? Et cetera.”
Down with the silos
Ivy is enthusiastic as she explains what appeals to her about the collaboration: “This partnership and the Centre in particular provide a platform for cross-functional research, combining insight and expertise from organisational behaviour, marketing & sales and supply chain management. At SAS, we advocate this kind of a multidisciplinary, holistic approach in everything we do. We help our clients break down their data silos and combine different data sources to obtain a full view of their organisations and customers, which is a must for informed decision-making.”
Actionable insight and advice
When will this partnership be considered a success? “The maturity model and assessment tool were developed in close collaboration with the members of the research centre. We hope to continue this process of co-creation with the same zeal,” says Karlien. “Our research and workshops at the Centre will provide deeper insights into forecasting practice and how it can be improved. Our aim is to conduct research from which we can draw practical, actionable advice for our members.” “Which will also benefit our clients,” Ivy adds with a smile.