Using suitable examples discuss the difference between qualitative and quantitative methods for forecasting

05 Oct

Advanced Supply Chain Management

1. For most organizations, the main target of supply chain management is to realize and neutralize the uncertainties in their supply chains. Discuss what you mean by “uncertainty in a supply chain”. Select any organization of your choice, study and explain in detail how they are dealing with supply chain uncertainties. Also, discuss what you infer from the study.
2. What are the various aggregate planning strategies followed by organizations. Select any manufacturing organization and discuss its aggregate planning strategy.
3. Because of global competition, demand is no longer certain for any business. The overall environment today is dynamic, firms are increasingly realizing that understanding demand, planning demand and linking supply with demand pays. At the same time, if the supply chain forecast is wrong, the consequences will be felt throughout the entire supply chain.
This is why forecasting has assumed a significant importance, and more and more supply chain managers are looking to forecasting to reduce operational costs. Despite significant developments in the area of supply chain forecasting as well as IT, most organizations do a poor job of incorporating demand uncertainty into their production planning processes. Most often this is blamed on forecasting without realizing the importance of selecting the appropriate forecasting technique.
Forecasting methods works efficiently when business driven variability are traced and then factored into forecast. Finally, it should be remembered that forecasting is an integrated exercise in which all levels of the supply chain are involved and are willing to share information which helps in increasing demand visibility within organizations as well increase the performance of forecast.
Source: Rakesh Singh, “Demand forecasting in a supply chain”, Business Standard, August 18, 2014
a. Explain the meaning of demand forecasting and discuss its role in supply chain management.
b. Using suitable examples discuss the difference between qualitative and quantitative methods for forecasting. In your opinion which one is the better method for forecasting?

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