Which of the following is a benefit of demand sensing?

Demand sensing is a vital technique that enables organizations to respond more effectively to fluctuations in customer demand. The primary benefit of demand sensing is its ability to enhance responsiveness to demand volatility through real-time insights and analytics. By utilizing advanced data from various sources, such as point-of-sale transactions, social media trends, and market analytics, companies can gain an up-to-the-minute understanding of customer behavior.

This increased awareness allows businesses to adjust their supply chain operations, inventory levels, and production schedules in a timely manner. Instead of relying solely on historical data and trends—which may not accurately project future demand—demand sensing empowers organizations to more accurately align supply with actual consumer needs. This ultimately leads to improved customer satisfaction and optimized resource utilization.

In contrast, increasing reliance on time-series forecasting can limit responsiveness because it typically works with historical data patterns rather than real-time information. Ignoring changes in customer demand directly contradicts the principles of demand sensing, as this method thrives on understanding and adapting to customer dynamics. Finally, decreasing automation in forecasting tasks would likely hinder efficiency and accuracy, which are crucial for successful demand sensing operations. Thus, the primary benefit of demand sensing is its ability to facilitate a better response to demand volatility.