BU385 Chapter 3: Demand Forecasting
Document Summary
Primary goal of operations management is to match supply to demand forecast of demand essential for determining how much capacity/supply will be needed to meet demand. Demand forecast the estimate of expected demand during a specified future period. To make forecasts, two kinds of info are taken into consideration: current factors or conditions, past experience in a similar situation. Demand forecasting involves modeling past pattern of demand for an item and projecting it into the future while taking new developments into account. 3 types of uses for demand forecasts in operations: help managers design the system. Long-term plans about which goods are services to offer. Where to locate: help managers plan medium-term use of system. Planning production at aggregate product family level: schedule short-term use of the system. Generally, responsibility for preparing demand forecasts for finished goods/services lies with marketing or sales departments rather than operations.
