Certified Supply Chain Professional (CSCP) Practice Exam

What should a demand manager do when actual demand is less than planned?

1. Alter the demand plan on their own

2. Inform supply to adjust accordingly

3. Ignore the discrepancy

4. Communicate only with sales

The correct answer is: Inform supply to adjust accordingly

When actual demand is less than planned, it is essential for the demand manager to inform supply to adjust accordingly. This is crucial because supply chain operations relies on accurate alignment between demand and supply. If the demand is lower than expected, the supply side may need to adjust their production schedules, inventory levels, or resource allocations to avoid excess inventory or inefficiencies in the system. By communicating with the supply functions, the demand manager facilitates a proactive response to the change in demand, which can help mitigate the risk of overproduction and associated costs. This collaborative approach is vital for optimizing the supply chain, enhancing responsiveness, and maintaining a balance between supply and demand. In this context, altering the demand plan independently could lead to misalignment with other stakeholders. Ignoring the discrepancy would create further issues down the line, such as excess inventory or wastage. Communicating only with sales would overlook the importance of involving supply management, which is critical to effectively managing the supply chain. Therefore, informing the supply side about the lower actual demand ensures that the entire supply chain operates more efficiently and effectively.