33:799:301 Lecture 2: Forecasting and Demand Planning
Document Summary
Lecture 2/chapter 2 forecasting and demand planning: elon musk kham academy video. Once had to stop production between usb cables were missing. Shipments couldn"t go through because it was mixed with other things that customs didn"t like from china: forecasting big picture. A prediction about the future; the more accurate the forecast, the better informed decisions will be. Essentially, all models are wrong but some are useful george fox. Assume similar buying behavior, consumption trends, competitive dynamics. Always will be some degree of error and variation. Macro level more accurate than micro easier to predict total category sales. 7 elements of a good forecast than specific products. Next 6 months is easier to forecast than next year: timely, accurate, reliable, meaningful unit of measure, communicated in writing, simple to understand and use, benefits should be greater than costs of developing, nestle video. Improved forecast accuracy could result in better customer service and lower inventory costs.