Forecasting Part 1 (1)

Forecasting Part 1 (1) - Forecasting Chapter3 Forecasting...

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Forecasting Chapter 3
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Forecasting Why? Operations managers need to match supply and demand. To plan well, forecasts must be made. Forecasts are the basis for budgeting, planning capacity, sales, production and inventory, personnel, purchasing, and more.
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Forecasting What? Forecast demand, not sales. When? Short term – pertaining to ongoing ops. Long range – strategic planning tool, new products & services, new equipment, new facilities, etc.
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Forecasting Who uses the forecasts? Accounting, Finance HR, Marketing, MIS, Operations, Product/service Design Everyone should use the same forecast. Why would this be difficult? Who makes the forecasts? Generally, marketing or sales forecast demand . Operations forecasts would focus on inventory, resource needs, etc.
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1. Expected level of demand Function of structural variation (i.e. trend or seasonal variation) 2. Degree of accuracy that can be assigned to a
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Forecasting Part 1 (1) - Forecasting Chapter3 Forecasting...

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