With JDA Demand, Fujitsu was able to create an 18-month rolling forecast that could be updated monthly, enabling the company to respond more quickly and efficiently to changing customer needs.

1. Case Study
High-Tech Products, High-Tech
Forecasting
JDA Demand Helps Fujitsu Cut Forecast Errors by 20 Percent via a Faster, Leaner Process
Fujitsu
Fast Facts
Industry
Manufacturing – High Tech
Headquarters
Richardson, Texas
Description
Fujitsu Network Communications Inc.,
headquartered in Richardson, Texas, is an
innovator in optical and wireless networking
solutions. The company offers a broad portfolio
of multi-vendor network services, as well as end-
to-end solutions for design, implementation,
migration, support and management of optical
networks. Fujitsu has more than 450,000 network
elements deployed by major North American
carriers. Fujitsu Network Communications
is supported by Fujitsu Limited, a global
corporation with annual sales of $54 billion,
Objective
employing approximately 175,000 professionals
in 70 countries. Create an 18-month rolling forecast that could be updated monthly, enabling
the company to respond more quickly and efficiently to changing customer
needs.
Solution
• JDA® Demand
“JDA has enabled us to actually take Services
market share by being able to deliver • JDA Consulting Services
product on time.” • JDA Strategic Services
– Barry Chapman,
Senior Product Manager, Demand Planning, Real Results
Fujitsu Network Communications • Cut aggregate forecasting error rate by 20 percent
• Reduced forecasting staff from 25 to five people
• Decreased forecasting cycle time from six weeks to two weeks
• Moved from a 12-month rolling forecast to an 18-month rolling forecast
• Decreased inventory while maintaining service levels

2. with these laminated calendars and they “In addition, JDA Demand was very
were color-coded, so that you knew when flexible in terms of the data measures that
you were expected to participate in the we could actually choose and implement.
forecast and then when you were JDA gave us the ability to forecast price as
expected to sort of step out of the way,” well. Since price is actually the translator
Chapman recalled. between units and revenue, and there are
always downward pricing pressures, we
The repercussions of this time- and labor-
wanted to be able to catch those,” said
intensive forecasting process were felt
Chapman. “All those things, plus just the
across Fujitsu’s supply chain. “A 12-month
flexibility of evolving the system over time
forecast was not giving our suppliers the
as we learned more about our business or
visibility that they needed. We wanted to
as our business changed, those were the
be able to reduce the number of people
driving considerations in choosing JDA
that were actually involved and produce
Demand.”
an 18-month rolling forecast every month,”
said Chapman. “At the same time, we
wanted to be able to improve our forecast A Journey Toward Continuous
accuracy, so that we could make better
Fujitsu Network Communications provides Improvement
decisions. Those were the arguments for
a diverse range of products to the
implementing a new demand planning In implementing JDA Demand, Fujitsu
telecommunications and cable industries.
system.” relied on JDA Strategic Services and JDA
Its major customers include household
names such as AT&T, Verizon, Time Warner Consulting Services to ensure a smooth
and Comcast. Fujitsu’s market-leading transition. “We worked with JDA up front
Complex Products Bring Unique to help us develop a business case and to
optical and wireless networking solutions
help consumers around the world stay
Challenges scope the project,” said Chapman. “And
connected and informed. Because the then we worked with JDA and a couple of
After considering a number of software
technologies in this industry are mature its partners on the implementation. It was
vendors, Fujitsu decided to implement
— and competitors are plentiful — Fujitsu a really good experience. The initiative was
JDA Demand to help transform its supply
faces special challenges in matching considered successful. It was on time, on
chain. “We chose JDA Software because
supply profitably with market demand. budget and delivered the value that
they were able to address specific
everybody was expecting.”
“As with any technology, when you first challenges we had in forecasting highly
introduce it, it’s special, but it doesn’t take configurable products,” explained The result was a complete transformation
long for it to become a commodity,” said Chapman. “JDA had this concept of ‘attach of the forecasting process at Fujitsu, with a
Barry Chapman, senior product manager rate,’ which turned out to be very number of top-line and bottom-line
for demand planning at Fujitsu Network powerful. We actually sell products benefits. “Since we implemented JDA
Communications. “Customer lead times composed of multiple parts that can be Demand in 2000, the improvement
get shorter and shorter. Whoever can configured differently to address specific process has been a journey,” Chapman
deliver, whoever has the inventory, it’s customer needs. There is not one noted. “We’ve focused on efficiencies, on
almost like an auction. More important configuration per product but hundreds. reducing the cost to develop a forecast.
than price is ‘Do you have product? We track all of these parts as independent We’ve gone from 25 people participating
Because I have a customer that’s waiting.’ demand in our enterprise resource to five, while increasing the number of
Service is turned up in a short period of planning system. We needed a way to tie products and customer accounts that we
time. If you have product, then you win. the parts to the product, creating forecast. We’ve gone from taking six weeks
And that’s the way that you actually gain dependent demand so that a revenue to taking two weeks. We’ve gone from a
market share, not necessarily through forecast by product would yield the 12-month horizon to an 18-month horizon,
price erosion, but being able to deliver on correct number of parts.” which helps our suppliers better plan for
time.” our requirements, so we don’t have as
“The other thing that was important was
many supply issues.”
While its products have always had a the ability to translate easily between
reputation for high quality, in 2000, units and revenues. If we changed Chapman said that Fujitsu reduced its
executives at Fujitsu recognized that they revenues, we wanted to be able to see the aggregate forecast error rate by 20
lacked the ability to forecast demand change in units immediately,” he added. “A percent, meaning that the company had to
accurately, as well as act responsively to lot of the information or input to the carry a lot less inventory than it did
have products available. “We were forecasting process comes in terms of previously to realize the same service
basically doing all of our forecasting and dollars, so we needed a way to translate levels. “We’ve seen our inventory turns
planning on spreadsheets. It was taking us those into units. JDA’s attach rates help us increase to a little over a turn per month.
about six weeks to do a 12-month rolling do that, but also some of the This is a significant improvement,” he said,
forecast. We also had about 25 people programming language allowed us to “and it’s pretty high for the industry.”
stepping in and out of the process during actually build those calculations into the
those six weeks. Everybody walked around process.”

3. “All in all, over the last 12 years, we’ve actually help you afford inventory risks,” he According to Chapman, over the last 12
consistently seen improvements, and it’s explained. “When you start eroding those years the Fujitsu-JDA relationship has
become somewhat expected now,” said margins, you have to have faster turns, so continued to evolve and strengthen. “I
Chapman. “So in this process, we’ve you can’t carry as much inventory. You would describe our relationship with JDA
created a culture of continuous can’t tolerate as much variability in as collaborative. It’s not like a customer and
improvement.” demand. You can’t assume as much risk, vendor. It’s more of a partner relationship,
and that really hurts you.” and JDA is as invested in our success as we
are,” he explained. “JDA brings a lot of
Standing Out in the Crowd “We try to compete based on customer
expertise in terms of not only software, but
value,” Chapman said. “Our customers
also business processes — and a lot of
Since implementing JDA Demand, Fujitsu evaluate vendors in terms of their
those things are baked into the tool, or into
has been able to differentiate itself among perceived benefit and the total cost of
the implementation templates. It’s been a
competitors with its high service levels ownership. So we try to compete on
really good relationship. You always have a
and customer responsiveness. quality and service as opposed to price.
tendency to trust the people that make
Time to delivery is critical. When
“JDA has enabled us to actually take you look good.”
customers need something, we want to be
market share by being able to deliver able to support that. JDA has been able to
product on time,” Chapman said. “So when help us with better forecasting, better
our competitors have problems with
About JDA Software, Inc.
decision making, better planning and
delivery, we’ve always seemed to be able better on-time delivery.” JDA® Software Group, Inc., The Supply
to have the products — and we don’t have
Chain Company®, offers the broadest
to compete as aggressively on price. We
portfolio of supply chain, retail
want to compete on quality and time to A Partnership Based on Trust merchandising, store operations and all-
delivery, because that’s what’s really
channel commerce solutions to help
important to the customer.” “At Fujitsu, there’s a lot of confidence that
companies manage the flow of goods
JDA Demand actually delivers what it
According to Chapman, in a technology from raw materials to finished products
promised. It has helped our demand
arena that has become a commodity and into the hands of consumers. JDA’s
planners do their jobs better. If you were
market, competing based on price deep industry expertise and innovative
to tell them that you were about to
represents the worst possible scenario for cloud platform helps companies optimize
replace that tool, there would be a small
long-term success. “When you start inventory, labor and customer service
revolt. That would be asking them to give
competing on price, it’s going to reduce levels. As a result, JDA solutions have
up their security blanket. They’re invested
your margins, and your margins are what become the standard for the world’s
in that tool,” noted Chapman.
leading retailers, manufacturers and
distributors.
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