MANGT 421 Lecture 4: Chapter 4 Review

39 views3 pages

For unlimited access to Class Notes, a Class+ subscription is required.

Forecasting Time Horizons
o Short-Range Forecast up to 1 year, usually less than 3 months
Purchasing, job scheduling, job assignments, production levels
Usually more accurate than long term
o Medium-Range Forecast 3 months to 3 years
Sales, production, planning, budgeting
o Long-Range Forecast 3 years or more
New product planning, facility location, research and development
Introduction and Growth require longer forecasts than maturity and decline in the
product life cycle
Types of Forecasts:
o Economic address business cycle, inflation rate, money and supply, housing
starts
o Technological predict rate of technological progress, impacts development of
new products
o Demand predicts sales of existing products and services
Strategic Importance of Forecasting
o Supply Chain Management good supplier relations, advantages in product
innovation, cost and speed to market
o HR hiring, training, laying off
o Capacity Capacity shortages can result in undependable delivery, loss of
customers, loss of market share
The 7 Steps to Forecasting
o Determine the use
o Select items to be forecasted
o Determine the time horizon
o Select the models
o Gather data needed
o Make the forecast
o Validate and implement results
Product family and aggregated forecasts are more accurate than individual product
forecasts
Forecasting Approaches
o Qualitative Methods used when situation is vague with little data
New products, new technology
Involves intuition and experience
o Quantitative Methods used when situation is stable and historical data exists
Existing products, current technology
Involves mathematical techniques
find more resources at oneclass.com
find more resources at oneclass.com
Unlock document

This preview shows page 1 of the document.
Unlock all 3 pages and 3 million more documents.

Already have an account? Log in

Get access

Grade+
$10 USD/m
Billed $120 USD annually
Homework Help
Class Notes
Textbook Notes
40 Verified Answers
Study Guides
1 Booster Class
Class+
$8 USD/m
Billed $96 USD annually
Homework Help
Class Notes
Textbook Notes
30 Verified Answers
Study Guides
1 Booster Class