DDMRP Feasibility Assessment in the Pharmaceutical Industry
Author(s)Lin, Jui Han; Wai-En Tchen, Michael
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DDMRP, a supply chain methodology introduced in 2011, aligns planning activities around incoming demand signals without the use of forecasts to predict future demand. The Demand Driven Institute (DDI) claims that DDMRP can reduce median inventory le vels by 31%, improve median service levels by 13%, and reduce the order lead time. This capstone explores the DDMRP framework to assess the feasibility and the potential value-added of adopting this methodology in an established supply chain. A simulation model was built to test DDMRP in a multi-echelon environment and quantify the impact of altering planning parameters. This simulation model was then extended to match the specifications of one of the partner company’s supply chains to compare the relevant metrics to their existing key performance indicators. The research identified several difficulties experienced when DDMRP is adopted in this simulated complex and highly constrained supply chain. These issues must be taken into consideration before full-scale implementation.
Demand Planning, Inventory Management, Production Planning
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