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August 10, 2018

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Obsolescence Planning

How many times have you faced with a refrigerator like this? Just who got these stuff? and when?... Yes, after a certain period these are of no use. Old inventory that is non moving is analogous to this situation. It is just a backup, how is that going to affect my shelf?? It is consuming you energy, using your space, and costing you without any returns. Any physical product, part, software technology could become obsolete in this fast paced world. Hence in any industry it is required to plan ahead to manage obsolete parts and to be obsolete parts. Now that we understood what is obsolescence planning and also why it is important, let's have an example of its application in real world.

Baskets of customers

Are you a Earthian? You must love to visit Mars!!! Clustering customers purely based on demography and industry is like saying the above. Not all are same, they are similar! People are similar in one industry, one geographic location. But are they similar enough to sell your pen? No. A better way to cluster or group customers is by analyzing their behavior. With the power of data, it is now possible what a group customers would prefer to use. Some good characteristics to consider: Average Demand Interval Frequency of buys Recency of purchase Monetary value

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