MGCR 472 Chapter Notes - Chapter 3: Causal System, Operations Management, Delphi Method
6 Aug 2017
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Document Summary
Forecasts are vital inputs for the design and the operation of the productive systems because they help managers to anticipate the future. Some of the techniques are simple, and others are complex. Some work better than others, but no technique works all the time. Moreover, all forecasts include a certain degree of inaccuracy, and allowance should be made. The techniques generally assume that the same underlying causal system that existed in the past will continue to exist in the future. All forecasts tend to be inaccurate; therefore, it is important to provide a measure of accuracy. It is possible to compute several measures of forecast accuracy that help managers to evaluate the performance of a given technique and to choose among alternative forecasting techniques. Forecasting techniques can be classified as qualitative or quantitative. Qualitative techniques rely on: judgment, experience, expertise to formulate forecasts. Quantitative techniques rely on: the use of historical data, associations among variables to develop forecasts.
