Re: POs considered harmful for dependent demands

["Bob Haugen" <bhaugen32@hotmail.com>]

Andrew Macpherson wrote:
>I'm not sure if there is a real difference. Whether it is a PO or a
>dependent demand, one is satisfying a need with a service or a good.  No
>matter what you call it it is a request for item, quantity and price
>(information) coupled with a linked payment stream.

One significant difference is that a dependent demand
is (as the name implies) dependent on its relative
independent demand for quantity, timing and even existence.
For example, if you order a computer from Dell, and
select a monitor, the monitor is a dependent demand.
If you change your order to two computers or delay
the purchase until next month or cancel it, the
dependent demands for the monitor had better change
likewise.

If the dependent demand is buried in an aggregate
PO line item, it becomes much more difficult to
change it, and in most business software packages
will require human intervention.
The problems arise in the way typical business software
handles purchase orders.

If it was just an object with those simple properties
that you describe above, there would be no problem.

Regards,
Bob Haugen


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