Demand Forecasting in a Supply Chain

What is the definition of forecasting?

• A planning tool that helps management in its attempts to cope with the uncertainty of the future, relying mainly on data from the past and present and analysis of trends.

• The organization and coordination of the activities of a business in order to achieve defined objectives.

• The process of obtaining and managing of products or services needed to operate a business or other type of organization.

• A claim for a sum of money as due, necessary, or required.

Which of these options are define the characteristics of forecasts?

• Appropriate flexibility is an effective approach for global supply chain to deal with variety of risks and uncertainities.

• Aggregate forecasts are usually more accurate than dissaggregate forecasts, as they tend to have a smaller standart deviation of error relative to the mean.

• Uncertainly in demand and economic factors should be included in the financial evaluation of supply chain design decisions.

• Forecasts is not 100% accurate and should thus include both the expected value of the forecast and a measure of forecast error.

Which one of these options are not forecasting methods?

• Qualitative

• Quantitative

• Simulation

• Time series

Which of these points are important for an organization to forecast effectively?

• Understand the objective of forecasting.

• Forecast at the appropriate level of aggregation.

• Use multiple metrics to evaluate global supply chain networks.

• Establish performance and error measures for the forecast.

• Combine strategic planning and financial planning during global network design.

What is the definition of the "causal forecasting methods"?

• It use historical demand to make a forecast. They are based on the assumption that past demand history is a good indicator of future demand.

• It assume that the demand forecast is highly correlated with certain factors in environment (the state of the economy, interest rates, etc.)

• It imitate the consumer choices that give rise to demand to arrive at a forecast.

• They are primarily subjective and rely on human judgment.

What is the goal of forecasting? (Chose the BEST answer)

• To underutilize facilities

• To plan for new storage options

• To help plan

• To predetermine number of mangers

What forecasting methods is of most use to Special K Cereal makers?

• Quantitative

• Status Quo

• Qualitative

• Survey

Time series analysis involves:

• Analysing past data

• Predicting future sales

• Assuming past data is a reliable indicator of future sales

• All of the above