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Forecasting In The Supply Chain Environment

  • David Frederick Ross
Part of the Chapman & Hall Materials Management/Logistics Series book series (CHMMLS)

Abstract

Much of the success of enterprise planning and decision-making processes depends on the formulation of accurate forecasts. Although it has often been said that nothing really happens until a company receives a customer order, unless the enterprise has developed sound plans that enable it to purchase the proper inventory, establish the necessary supply channels, and deliver goods on a competitive basis, the business cannot possibly hope to achieve corporate objectives. In addition, forecasting permits firms to establish performance measurements for customer service, plan the level of total inventory investment, choose between alternative operating strategies, and develop assumptions about the ability of the business to respond to the future needs of the marketplace. Effective forecasts can dramatically improve enterprise profitability, productivity, and customer service and ensure competitive advantage. Good forecasting also assists strategic planners to eliminate waste in the form of excess inventory, reduce lost sales and expensive expediting, and control costs involved in maintaining plant size, labor, equipment, and transportation. Finally, the communication of accurate and timely forecasts enables entire supply chains to construct agile and scalable supply networks, architect unique channels of collaborative, value-creating relationships, and continuously align supply network capabilities with the requirements of the customer.

Keywords

Supply Chain Forecast Error Forecast Method Mean Absolute Deviation Exponential Smoothing 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Science+Business Media New York 2004

Authors and Affiliations

  • David Frederick Ross

There are no affiliations available

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