Lecture_1_FC_2011_Give - Forecasting Forecasting Demand?...

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Forecasting Forecasting Demand? Sales will be $200 Million!
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The need to respond to an event, phenomenon or predicted value of a variable. Response may be in the form of planning, organizing resources and responding to the event, or expected set of events. Forecasting Techniques ¾ Quantitative, Qualitative, Unpredictable Quantitative - data -Sufficient quantitative information is available Time series >Predicting the continuation of historical patterns. >growth in sales or GNP -Explanatory Understanding how explanatory variables such as price and advertising affect sales Qualitative - judgment Little/no quantitative information is available, but sufficient qualitative knowledge exists >Predicting the growth of high end mobile phones in year 2015
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Forecasting Techniques (Cont’d) Unpredictable -Little or no information is available e.g. Effects of interplanetary travel -Discovery of a new, very cheap form of energy that produces no pollution- will fuel cells replace I.C. engines? Explanatory Vs. Time Series Forecasting (REPEAT) Explanatory Models Assume that the forecast variable exhibit an explanatory relationship with one or more independent variables GNP = f (monetary and fiscal policies, inflation, capital spending, imports, exports, error) Time series Models Treat the system as a black box and make no attempt to discover the factors affecting its behavior GNPt+ 1 =f ( GNPt , GNPt- 1, GNPt- 2, GNPt- 3, …, error )
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Accounting Cost/profit estimates Finance Cash flow and funding Human Resources Hiring/recruiting/training Marketing Pricing, promotion, strategy MIS IT/IS systems, services Operations Schedules, MRP, workloads Product/service design New products and services Uses of Forecasts Elements of a Good Forecast Timely Accurate Reliable M e a n i g f u l Written E s y to
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This note was uploaded on 03/03/2011 for the course MARKETING 101 taught by Professor Singh during the Spring '11 term at Management Development Institute.

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Lecture_1_FC_2011_Give - Forecasting Forecasting Demand?...

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