Barry Render / Ralph M. Stir, JR.
Summarized by - NOPPOL BEOKHAIMOOK
Learning Objectives (1)
Students will be able to:
– Understand and know when to use various families of forecasting models
– Compare moving averages, exponential smoothing, and trend time-series models
– Seasonally adjust data.
– Understand Delphi and other qualitative decision-making approaches
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Learning Objectives (2)
Students will be able to:
– Identify independent and dependent variables and use them in a linear regression model.
– Compute a variety of error measures. 2
Corporate Planning (1)
• Determine organization : 5W1H
- WHY it should do ?
- WHERE it should be ?
- WHAT it should do ?
- WHEN it should do to be done ?
- WHO should do ?
- HOW it should do ?
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Corporate Planning (2)
• A deliberate and conscious attempt to anticipate and “Forward Look” the environment.
• Looking ahead systematically.
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Planning Steps (1)
• ASSESS - Internal and Environment
Factors (SWOT)
• FORMULATE - Corporate Objectives,
Strategies and Action Plans
• CASCADE - Corporate Objectives,
Strategies, Action Plans down to Lower
Levels (One Layer at a time)
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Planning Steps (2)
• QUANTIFY - Action Plans &
Strategies into Budgets starting with lowest Operating Unit.
• CONSOLIDATE - Budgets upwards until the corporate level is reached.
• IMPLEMENT - Plans
• MONITOR - Feedback and Control
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Desirable Attributes of Good Objective
• ADAPTABLE - Changeable and Flexible.
• MEASURABLE - The results can be readily quantified and evaluated. • COMMITMENT - Capable of inspiring Commitment
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Objectives Perspective
• FINANCIAL PERSPECTIVE
• CUSTOMER PERSPECTIVE
• INTERNAL PROCESS
PERSPECTIVE
• LEARNING AND GROWTH
PERSPECTIVE
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Importance of Forecasting
Business Planning
(Demands for products, Return on Investment,
Sales Volume, Expense, etc.)
Analytical Tools
Mathematical Techniques
Forecasting
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Steps of Forecasting (1)
1. Determine the forecast objective
2. Select the items or quantities to be forecasted
3. Determined time horizon of forecast
- Short term / Medium term / Long term
4. Select Forecasting MODEL (S)
5. Gather data needed to make the forecast
6. Validate forecasting model
7. Make the forecast
8. Implement the results
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Steps of Forecasting (2)
•
Initiating, designing, implementing forecasting system ==> Systematic way and Automatically
• Computer System
==> Input (Files / Records)
Processing (Software / Program)
Output (Files / Reports)
• No Single method is superior, whatever
(quantitative, subjective, mixed) works best should be used
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Types of Forecasting (1)
Figure 5.1 - Forecasting Models Discussed
Forecasting
Techniques
Qualitative Models
Time Series Methods
Causal Methods
Delphi Methods
Moving Average
Simple Regression
Jury of Executive
Opinion
Exponential Smoothing
Multiple Regression
Sales Force Composite
Consumer Market
Survey
Trend Projections
Decomposition (T*S*C*I)
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Types of Forecasting (2)
•
Time-Series Models
– Use past data to make a forecast over
a period of time
– Three techniques of time-series models
1. Moving Average
2. Exponential Smoothing
3. Trend Projections
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Types of Forecasting (3)
• Causal Models
– Incorporate the variables that might influence the quantity being
