What is driving the demand for decision forecasting tools today?
Globalisation and the speed at which companies need to service customers. Dell, for instance, makes its laptops in South East Asia. The company gets an order in the US, assembles it in Taiwan, flies it to the US and delivers it to customer under just three days. I’ll provide you another amazing fact. Every company has certain amount of inventories. HP would have six-nine months of their annual revenues tied up in inventories. So they have that much invested in working capital. Typically, three-nine months is common in hardware. Dell, on the other hand, has an inventory of minus seven days. Dell collects its money from its customer before it pays the vendor, who bill them for their inventory. How do companies like HP and Dell take decisions such as: how much capacity to plan, how many laptops must the company have in its inventories? Its on the basis of these decision-making tools. Its not large organisations like Dell alone that need such tools. The crux is if one could see the future,