Forecasting Best Practices Essay -- essays research papers

Forecasting Best PracticesEffective demand planning and sales promise across the supply chain can bring a host of benefits. Specific bothy, it can help improve labor productivity, reduce head count, cut inventories, and drive on up production flows, and increase revenues and profits.-Edward J. MarienTo find the best practices for forecasting, our team researched many cases of forecasting success, and found five companies with a common theme. Rayovac, the Coca-Cola Bottling Company, AAi. FosterGrant, the Sara Lee Corporation, and the Scotts Company all had major problems with forecasting, some of them very similar. To address and solve these problems each of these companies made major improvements to their forecasting systems. Although some used similar methods and others very different, these companies found that the right wing people, process and study technology was the key to efficient and accurate forecasting. RayovacRayovac discovered the proper use of forecasting when it im plemented its consensus decision-making teams to improve their performance. They believe that the best information comes directly from the customer. Therefore, their forecasting takes place from the bottom-up. Sales, marketing, finance, and supply chain builds a consensus for forecasting, inventory management, scheduling, wargonhousing, and transportation. Their consensus forecasting is the responsibility of a cross-functional team.For their annual planning process, a bottom-up and a top-down forecasting procedure is used. The top Key Results Measures (KRMs) are compared with the bottom-up forecast which is developed by the consensus teams. Meetings are held to align the two when there are discrepancies. Monthly meetings are held to update the bottom-up forecast and actions are taken to bring the forecast and annual plan into alignment. Rayovac has discovered some key guidelines to be used for triple-crown forecasting and planning1.Actually using the forecast to drive the business and not... ...orecasting cannot be understated. Many companies have found that after successful forecasting and proper use of people, process, and technology have led to increased performance of the company as a whole. This has been proven in our analysis of the actual best practices of forecasting in the workplace.References1.Bowman, Robert J. Scotts Cultivates a Customer Centric Supply Chain Strategy. globular Logistics and Supply Chain Strategies, July 2004.2.Hoffman, Kurt C. Whos That Behind FosterGrants Demand. Global Logistics and Supply Chain Strategies, December 2003.3.Marien, Edward J. Demand Planning and Sales Forecasting A Supply Chain Essential. Supply Chain Management Review, 19994.Murphy, Jean V. more Accurate Forecasts Give Sales, Operations Planning New Life at Sara Lee Unit. Global Logistics and Supply Chain Strategies, March 2003.5.Murphy, Jean V. Special secrete Collaborative Commerce Forecasting Tool Lowers Coke Bottlers Inventory. Global Logistics and Suppl y Chain Strategies, November 2002.