demantra & ascp

Using Oracle Demantra & ASCP in a Global Planning Environment

Phillip BrownResMed

16 August 2010

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Presentation Outline

• Overview of ResMed operation• Reasons for implementing Oracle Demand

Management/Advanced Supply Chain Planning• Key elements

– People, integration, improving forecasts, tips & traps

• Conclusion

ResMed…overview

Overview Earnings >1Billion USD annually manufacturing sites Sydney & Singapore 95% of production exported Demantra implementation commenced March 2008 Approximately 100 Demantra users globally Interfaces with Oracle ERP for manufacturing & distribution

ResMed…global operations

Why implement?Tangibles…

• Positive ROI– Reduce inventory– Reduce backorders

or lost sales

Intangibles….• Manage increased

business complexity• Introduce process

stability• Reduce dependence on

specific individual knowledge

• Provide foundation for future growth

Why implement…tangible reasons• Maximum inventory reduction

from forecast accuracy achieved– Current forecast accuracy ~90%

• Variation in supply chain now greater challenge– Variations in shipping times– Delays through customs– Stock discrepancy & quality issues– The need to rebalance between

nodes without triggering new builds

Why implement…intangible reasons

• Key drivers for Demantra– Increasing distribution complexity– Risks associated with reliance on

individuals– Risks with lack of robustness in

existing system– Need for seamless global system that

facilitates accountability and visibility

Why implement…intangible reasons

• Key drivers for ASCP– Increasing distribution complexity– Need for more effective optimisation

model– Need to remove reliance on

individuals– Risks with lack of robustness in

existing system

Musings about Demantra & ASCP

Why Demantra wont improve your forecast accuracy…further

Do I have the right people?

Getting ASCP & Demantra to work together

Tips & traps…I wish I hadn’t done that!

People puzzle…

– caliber of people available to perform various roles

– defining ownership between Business Process and IT

• Degree of autonomy of users

Demantra, & to some extent ASCP evolution will be influenced by…

People puzzle…

– System developers– Database administrators– Power users (demand planners)– Casual users

Key users involved with the running of Demantra…

Integrating ASCP & Demantra…

– Create customer/warehouse combinations in Demantra

• Load based on warehouse

– Create customer/region combinations in Demantra

• Map regions to warehouses through dynamic combinations table

Loading forecasts to ASCP


– simple distribution operation– creates visibility of warehouse demand in Demantra– data integrity for customer/region combinations is not

available from source

Downside…– changes in Warehouse source for a given customer is not

easy to update in Demantra…can lead to erroneous forecasts

Using Customer/Warehouse combinations in Demantra…


– allows greater flexibility to change distribution network without impacting forecast

– could facilitate forecasts by territory/sales person or other similar splits

Downside– requires available data integrity to support this…

ResMed didn’t have this on a global basis

Using Customer/Region combinations in Demantra…

Improving forecast accuracy…

– Many sales incentives encourage customers to buy in erratic patterns. Erratic demand makes forecasting difficult.

Modify buyer behaviour rather than modifying forecasts

Tips & Traps…tips

• Bucketing of demand– Not too much/not too little gives a balance

between system performance and quality info

– ResMed option• Capture data by customer for top 50% revenue• Bundle data of customers for next 30% revenue• Bundle data for remaining 20% revenue

Tips & Traps…tips

• Capture demand not sales– To give true indication of future potential demand– Recognises customer orders in the period they

were requested, whether shipped or not, as opposed to shipped or invoiced orders

– Forecasts in future periods are then based on customers desires rather than operation capability at a previous point in time

Tips & Traps…tips

• Create separate inputs for functions– Such as separate series to create visibility of

user inputs– create clear override hierarchy for forecast

modification– Creates opportunity for input of reference

forecasts for future comparison or negotiation (eg Marketing/Finance series)

Tricks & Traps…traps

• Maintaining data for full spectrum of items– Ignoring data for “inactive” codes may present

problems later for things like exception reports

• Avoid inappropriate use of fields– inappropriate/inconsistent use of fields such as

“Territory” makes them difficult to use for meaningful data capture later

Conclusion• Support through implementation

– Oracle consultants provided effective guidance in the direction we took

– This was useful in either tempering our expectations, developing our ideas or providing alternatives to arrive at effective solutions

– Few changes were made after implementation largely as a result of an effective collaborative approach between Oracle & ResMed during development

Conclusion• Future direction

– Our key challenge now is implementation of ASCP

– Objective is constraint based optimisation– Horizon of at least 12 months to enter this

phase– Implementation of unconstrained ASCP as

precursor to this

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