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Business Forecasting

Business Forecasting . Chapter 1 Forecasting for Management Decisions. Chapter Topics. Introduction Importance of Forecasting Financial and Strategic Importance of Forecasting The Commonality of Forecasting. Importance of Business Forecasting. Allows organizations to improve profits

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Business Forecasting

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  1. Business Forecasting Chapter 1 Forecasting for Management Decisions

  2. Chapter Topics • Introduction • Importance of Forecasting • Financial and Strategic Importance of Forecasting • The Commonality of Forecasting

  3. Importance of Business Forecasting • Allows organizations to improve profits • Essential in eliminating waste such as: • Inventory shortages • Missed due dates • Plant shut-downs • Lost sales • Lost customers • Expensive expediting • Missed strategic opportunities.

  4. Financial and Strategic Importance • Better strategic information • Better marketing information • Better financial information • Better operating information • Increased customer service • Better allocation of resources (Continued)

  5. Financial and Strategic Importance • Increased manufacturing and operating efficiency • Higher productivity • Stability in planning • Reduced finished goods inventory • Elimination of waste • Increased profitability • Increased return on investment.

  6. The Commonality of Forecasting • All organizations wish for excellence in management (whether manufacturing or a hospital). • Demand for products, labor, materials, and other resources must be estimated using either formal or informal forecasting methods.

  7. Business Forecasting • The Art and Science of Forecasting • The Forecasting Process

  8. Business Forecasting Process

  9. Chapter Summary • Importance of Business Forecasting • As a Strategic Tool • Planning and Control Tool • Various Application of Forecasting in Business • The Art and Science of Forecasting • The Process of Forecasting

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