Project Management

Collaborative Planning, Forecasting and Replenishment (CPFR)

last edited by: Pang DX on Dec 6, 2018 9:55 AM login/register to edit this page

CPFR is a set of business processes, backed up by information technology software and network infrastructure, in which supply chain partners in both internal and external environments agree to work in tandem to meet mutual business objectives. They cultivate a mutual understanding of each other, hence able to develop jointed Sales and Operations Plans (S&OP), and collaborate comprehensively to generate and update sales forecasts and replenishment plans in near real-time.

What distinguishes CPFR from traditional planning and forecasting approaches is the emphasis on collaboration laterally and vertically throughout the organization's internal and external environments. Experiences show that supply chains are better at meeting fluctuating demands and supplies and managing resources when the partners synchronize their plans and actions.

The holistic communication and engagement among partners mean that when market demands, supplies, or project requirements change, supply chain members can adjust the jointly managed forecasts and plans swiftly, entailing increased accuracy in forecasting and replenishment. This will minimize or even eliminate obsolete stock, overstock, and understock.

Reference: Cecil B. Bozarth & Robert B. Handfield (2013: 299): Introduction to Operations and Supply Chain Management, 3rd Edition, Harlow: Pearson Education Limited.

last edited by: Pang DX on Dec 6, 2018 9:55 AM login/register to edit this page

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