Demand Prioritization for a Water Technology Company

Abstract

With demand outpacing production capacity, increased variability in supply lead times and customers' conflicting requests to escalate orders, there is a demand prioritization debacle. This Water Technology Company is faced with inefficiently and manually prioritizing individual orders. To ensure the appropriate demand is fulfilled first, the Water Technology Company is seeking a standardized and repeatable demand prioritization process. This sustainable solution will allow for objective and immediate demand prioritization while taking into account all business stakeholder interests. By implementing a Multi-Criteria Decision Making (MCDM) model, the top criteria were identified. Along with MCDM, a hybrid approach to the Analytical Hierarchy Process (AHP) was applied to identify the weights for each of the six criteria. In order to normalize demand orders so the selected criteria could be compared to one another, value function patterns were applied to the criteria inputs. The MCDM demand prioritization model is expected to generate improvements in the key metrics of Profit Margin, Days to Delivery, and Days to Customer Want. The largest expected improvement is with the increase in Profit Margin, ranging from 75% to 250%. Simulation tests were conducted to review the robustness of the six criteria and the group aggregation methods of the criteria weights. This demand prioritization process can be customized and implemented to any industry in any country.