Collaborative planning, forecasting, and replenishment & firm performance: An empirical evaluation

The Collaborative Planning, Forecasting, and Replenishment (CPFR) initiative is an increasingly popular paradigm that helps the supply chain better coordinate activities to serve customers with improved demand forecasting and production scheduling. CPFR provides a framework that covers a broad range of issues including demand forecasting, inventory management, production and replenishment planning, and order fulfillment. This research provides empirical evidence of the effect of CPFR adoption on a firm's financial and operational performance as compared to similar firms who have not indicated that they were implementing CPFR. Using the event study method and a COMPUSTAT database, we find significant improvements in several performance measures for firms that have adopted CPFR.