discussion on forecasting info564 discussion
A prominent business leader once said: I have no time for forecasting models based on fancy formulas and tons of data. I just tell my guys what I want from them this year and they go achieve it.
- Would you like to work for this kind of boss? Is this approach practical? Justify your position in a post of 200-250 words. Use specific examples to illustrate your points.
- Post at least two comments (minimum 50 words each) on posts from other students.
I paste the two post below pleas post a comments (minimum 50 words each) on each posts
1st post :
I would certainly not like to work with this kind of boss who works like this. I would not respect this personâ€™s direction as there is no data or guidance to ensure targets are achieved. I would prefer to work with a boss who gives due respect to their associates, understands the importance for forecasting and modeling, and help them in grow in their career rather than just giving orders.
This approach is not practical since most organizations uses a variety of forecasting models to assess possible outcomes for the company. The methods used by an organization will depend on the data available and the industry in which the organization operates. The primary advantage of forecasting is that it provides the business with valuable information that the business can use to make decisions about the future of the organization.
I personally use forecasting in my role to determine how much additional inventory we need to order to ensure we meet targeted sales goals. If we used current demand, we would most likely run out of stock. While we have historical data to help us predict future ordering trends, we donâ€™t always have this data, such as when we launch a new item with a promotion attached. That requires additional research and forecasting based on comparable items. This alone assures me why forecasting is critical to the success of the future.
2nd post :
I would not like to work for this kind of boss. The leader seems set in their ways and believes that they knows whatâ€™s best without looking at any type of company data. No matter what the target may be, they have no information to back up their actions, or the actions of the employees. This approach is unpractical and is not the smartest or most efficient way to run a business. This leader seems to believe that year after year things will be the same, as they already know what they want from their employees. This could blindside the company and lead it down the wrong path and ruin their success.
Forecasting models are used to predict the future on the basis of what has happened in the past. By using forecasting models, this prominent business leader would be aware of what the company expects as they continue into the future. Organizations that engage in forecasting have a sense of how their environment may change and can they can prepare accordingly. A manager of any planning process should identify forecasts that would be most useful to the organization, whether that be based on judgement or quantitative analysis.
For example, in 2013, Nestle improved its forecast accuracy and made multi-million-dollar reductions in their inventory by removing human judgement and enabling demand forecasts for the company. As companies become more global than ever before, companies like Nestle need to understand their environment, such as the variability in demand and be able to predict it more accurately with enterprise-wide solutions and models.