1. Forecasting 5 June 2001

2. Introduction What: Forecasting Techniques Where: Determine Trends Why: Make better decisions

3. What is Forecasting? The art and science of predicting future events

4. Time Horizon Short Range – 3 – 12 months Medium Range – 3 months – 3 years Long Range – 3+ years

5. Qualitative Methods Jury of Executive Opinion Sales Force Composite Delphi Consumer Marketing Survey

6. Quantitative Methods Time Series Associative

7. Time Series Methods Trend Seasonality Cycle Random Variations

8. Naïve Approach

9. Moving Average Approach MA n n  Demand in Previous Periods Periods

10. Weighted Moving Average WMA = Σ(Weight for period n) (Demand in period n) ΣWeights

11. Exponential Smoothing F t = F t-1 +  (A t-1 - F t-1 )

12. MAD

13. MSE

14. Exponential Smoothing With Trend Adjustment F t =  (A t ) + (1-  )F t-1 + T t-1 T t =  (F t - F t-1 ) + (1-  )T t-1

15. Linear Trend Projection Equation: Slope: Y-Intercept:

16. Seasonal Variations

17. Regression Analysis Equation: Slope: Y-Intercept:

18. Standard Error of Estimate

19. Correlation Coefficient