Chapter 18: Forecasting

Question 1

What are strategic forecasts?

Answer 1

Decisions about overall directions

Question 2

What are tactical forecasts?

Answer 2

Used for day-to-day decisions

Question 3

What is the decoupling point?

Answer 3

The point at which inventory is stored allowing the supply chain to operate independently

~~ forecasting helps determine level of inventory needed at decoupling points

Question 4

What are the four types for forecasting?

Answer 4

1. Qualitative
2. Time series analysis
3. Causal relationships
4. Simulation

Question 5

What is autocorrelation?

Answer 5

The persistence of occurrence, value expected is highly correlated with its own past values

Question 6

What are the different types of time series analysis?

Answer 6

~ short term: forecasting <3mo
~ medium term: 3mo-2yr
~ long term: >2yr

Question 7

What are the factors that go into model selection?

Answer 7

1. Time horizon to be forecast
2. Data availability
3. Accuracy required
4. Budget
5. Availability of qualified personnel

Question 8

What are the two types of forecasting errors?

Answer 8

~ bias
~ random

Question 9

What is collaborative planning, forecasting, and replenishment (CPFR)?

Answer 9

~ a web-based process used to coordinate supply chain