The Business Forecasting Deal: Exposing Myths, Eliminating Bad Practices, Providing Practical Solutions

ISBN-13: 9780470574430 / Angielski / Twarda / 2010 / 272 str.

Michael Gilliland; Julie Platt

Opis

Practical-nontechnical-solutions to the problems of business forecasting Written in a nontechnical style, this book provides practical solutions to common business forecasting problems, showing you how to think about business forecasting in the context of uncertainty, randomness and process performance.

• Addresses the philosophical foundations of forecasting
• Raises awareness of fundamental issues usually overlooked in pursuit of the perfect forecast
• Introduces a new way to think about business forecasting, focusing on process efficiency and the elimination of worst practices
• Provides practical approaches for the non-statistical problems forecasters face
• Illustrates Forecast Value Added (FVA) Analysis for identifying waste in the forecasting process

Couched in the context of uncertainty, randomness, and process performance, this book offers new, innovative ideas for resolving your business forecasting problems.

Spis treści

Foreword ( Tom Wallace).

Foreword (Anne G. Robinson).

Acknowledgments.

Prologue.

Chapter 1 Fundamental Issues in Business Forecasting.

The Problem of Induction.

The Realities of Business Forecasting.

The Contest.

What Is Demand?

Constrained Forecast.

Demand Volatility.

Inherent Volatility and Artificial Volatility.

Evils of Volatility.

Evaluating Forecast Performance.

Embarking on Improvement.

Notes.

Chapter 2 Worst Practices in Business Forecasting: Part 1.

Worst Practices in the Mechanics of Forecasting.

Model "Overfi tting" and "Pick–Best" Selection.

Confusing Model Fit with Forecast Accuracy.

Accuracy Expectations and Performance Goals.

Failure to Use a Naïve Model or Assess Forecast Value Added.

Forecasting Hierarchies.

Outlier Handling.

Notes.

Chapter 3 Worst Practices in Business Forecasting: Part 2.

Worst Practices in the Process and Practices of Forecasting.

Politics of Forecasting.

Blaming the Forecast.

Adding Variation to Demand.

Evangelical Forecasting.

Overinvesting in the Forecasting Function.

Forecasting Performance Measurement and Reporting.

Forecasting Software Selection.

Editorial Comment on Forecasting Practices.

Notes.

Chapter 4 Forecast Value Added Analysis.

What Is Forecast Value Added?

The Naïve Forecast.

Why Is FVA Important?

FVA Analysis: Step–by–Step.

Further Application of FVA Analysis.

Case Studies.

Summary: The Lean Approach to Forecasting.

Notes.

Chapter 5 Forecasting without History.

Typical New Product Forecasting Situations.

New Product Forecasting by Structured Analogy.

Organizational Realignment.

Summary.

Notes.

Chapter 6 Alternative Approaches to the Problems of Business Forecasting.

Statistical Approach.

Collaborative Approach.

Supply Chain Engineering Approach.

Pruning Approach.

Summary.

Notes.

Chapter 7 Implementing a Forecasting Solution.

Why Do Forecasting Implementations Fail?

Preproject Assessment.

Requesting Information or Proposals.

Evaluating Software Vendors.

Warning Signs of Failure.

Notes.

Chapter 8 Practical First Steps.

Step 1: Recognize the Volatility versus Accuracy Relationship.

Step 2: Determine Inherent and Artificial Volatility.

Step 3: Understand What Accuracy Is Reasonable to Expect.

Step 4: Use Forecast Value Added Analysis to Eliminate Wasted Efforts.

Step 5: Utilize Meaningful Performance Metrics and Reporting.

Step 6: Eliminate Worst Practices.

Step 7: Consult Forecasting Resources.

Notes.

Chapter 9 What Management Must Know About Forecasting.

Aphorism 1: Forecasting Is a Huge Waste of Management Time.

Aphorism 2: Accuracy Is Determined More by the Nature of the Behavior Being Forecast than by the Specific Method Being Used to Forecast It.

Aphorism 3: Organizational Policies and Politics Can Have a Significant Impact on Forecasting Effectiveness.

Aphorism 4: You May Not Control the Accuracy Achieved, But You Can Control the Process Used and the Resources You Invest.

Aphorism 5: The Surest Way to Get a Better Forecast Is to Make the Demand Forecastable.

Aphorism 6: Minimize the Organization s Reliance on Forecasting.

Aphorism 7: Before Investing in a New System or Process, Put It to the Test.

Notes.

Epilogue.

Glossary.

Appendix Forecasting FAQs.

Accuracy Expectations.

Performance Benchmarks.

Performance Measurement and Reporting.

The Naïve Forecast.

Forecast Value Added Analysis.

Forecast Modeling.

Politics and Practices of Forecasting.

Demand Volatility.

Forecasting Process.

Judgment.

Forecasting Organization.

Low Volume/Intermittent Demand.

New Product Forecasting.

Forecasting Hierarchy.

Software Selection.

Index.

O autorze

MICHAEL GILLILAND is Product Marketing Manager at SAS Institute and has worked in consu–mer products forecasting for more than twenty years. Prior to joining SAS in 2004, Mike held forecasting management positions in the food, electronics, and apparel industries and served as a consultant. He is a frequent speaker at industry events, has published articles in Supply Chain Management Review, Journal of Business Forecasting, Foresight, and APICS magazine, and was a columnist on "Worst Practices in Business Forecasting" for Supply Chain Forecasting Digest. Mike holds a BA in philosophy from Michigan State University, and master′s degrees in philosophy and mathematical sciences from Johns Hopkins University. Follow his blog, The Business Forecasting Deal, at blogs.sas.com/forecasting.

Blurb

THE BUSINESS FORECASTING DEAL

Exposing Myths, Eliminating Bad Practices, Providing Practical Solutions

Business forecasting is the ultimate no–win game. You′re almost always wrong except on those rare, random occasions where actual sales come in exactly on forecast and you get beat up routinely for your "lousy forecasts." Against this framework, The Business Forecasting Deal turns forecasting on its head. Instead of focusing solely on statistical modeling and forecast accuracy accuracy being largely determined by the nature of the demand you are trying to forecast Michael Gilliland turns your attention to forecasting process efficiency and effectiveness. His unique perspective, utilizing the emerging method of Forecast Value Added (FVA) analysis, shows how organizations can meaningfully improve their performance by eliminating the "worst practices" that now sabotage and confound their forecasting efforts.

While predicting the future is a very difficult thing, there is no shortage of articles, books, consultants, and even software vendors willing to tell you (or sell you) their version of forecasting best practices. However, many of these purported "best practices" do not work they fail to make the forecast any better. Through FVA analysis a method that has been employed at several major corporations including Intel, AstraZeneca, Cisco, and Yokohama Tire (Canada) The Business Forecasting Deal shows how to identify the waste and inefficiencies in the typical forecasting process. By eliminating those (surprisingly common) practices that make the forecast worse, FVA analysis is helping companies get better forecasts with less effort and less cost.

Written in a nontechnical style, this book provides practical solutions to a wide variety of business forecasting problems. It illustrates a new way to think about business forecasting in the context of uncertainty, randomness, and process performance, all within the internal political arena in which real–life forecasting is conducted. While there is no magic formula to guarantee perfect forecasts, this book will change your perspective and improve your success in dealing with the problems of business forecasting.