What key aspect does effective demand management focus on?

Effective demand management is primarily concerned with aligning consumer demand with supply capabilities. This aspect is crucial because it helps organizations understand and respond to the actual needs and preferences of consumers, ensuring that the right products are available at the right time. By closely monitoring demand patterns, businesses can optimize their production schedules, manage inventory levels, and enhance customer satisfaction.

This alignment is vital in today's dynamic market environment where demand can fluctuate due to various factors such as seasonal changes, economic shifts, or competitive actions. By effectively managing demand, companies can balance their resources more efficiently, reduce excess inventory, and minimize waste, leading to improved overall operational efficiency.

In contrast, the other options do not capture the essence of effective demand management. Simply increasing production volume does not guarantee alignment with market demand and can lead to overproduction and unused inventory. Reducing inventory without considering demand can result in stockouts and lost sales opportunities, undermining customer satisfaction. Finally, creating barriers for new market entrants does not directly relate to managing demand; instead, it pertains more to competitive strategy and market dynamics. Thus, the core focus of effective demand management remains on aligning demand with supply capabilities to foster sustainable business performance.