Demand forecasting & Aggregate planning in a Supply chain. Session Speaker Prof.P.S.Satish
|
|
- Della Sutton
- 7 years ago
- Views:
Transcription
1 Demand forecasting & Aggregate planning in a Supply chain Session Speaker Prof.P.S.Satish 1
2 Introduction PEMP-EMM2506 Forecasting provides an estimate of future demand Factors that influence demand and whether these factors will continue to influence demand must be considered when forecasting. Improved forecasts benefit all trading partners in the supply chain. Better forecasts result in lower inventories, reduced stock-outs, smoother production plans, reduced costs, and improved customer service. Walmart s Strategy 4
3 Demand Planning and Forecasting Demand Planning Involves forecasting and other activities like Promotion etc. Types: 1. Independent Demand ( Ex: Finished goods) 2. Dependent or Derived Demand (Ex: components or subassemblies) Independent Demand items are forecasted whereas the Dependent items can be derived from the latter 100 Refrigerators = 100 Compressors 9
4 Approach to Demand Forecasting Understand the Objective of Forecasting Integrate Demand Planning and forecasting Identify factors that influence demand forecast viz Demand, Supply and Product Side Understand and Identify customer segments Determine the appropriate forecasting technique Establish Performance and error measures for the forecast. 10
5 Classification of Forecasting Short range ( up to 1 year ) Medium range ( up to 3 years ) Long range ( more than 3 years ) 12
6 Forecasting Types Economic Forecast IMF Technological Forecast Euro Engines Demand Forecast Matching Supply and Demand 13
7 Forecasting Techniques Qualitative forecasting is based on opinion and intuition. Quantitative forecasting uses mathematical models and historical data to make forecasts. Time series models are the most frequently used among all the forecasting models. 14
8 Forecasting Techniques- Cont. Qualitative Forecasting Methods Generally used when data are limited, unavailable, or not currently relevant. Forecast depends on skill and experience of forecaster(s) and available information. Four qualitative models used are: 1. Jury of executive opinion 2. Delphi method 3. Sales force composite 4. Consumer survey 15
9 Forecasting Techniques- Cont. Quantitative Methods Time series forecasting- based on the assumption that the future is an extension of the past. Historical data is used to predict future demand. Associative (causal) forecasting- assumes that one or more factors (independent variables) predict future demand. It is generally recommended to use a combination of quantitative and qualitative techniques. 16
10 Quantitative Methods Moving Average Method Exponential Smoothing Trend Projection Time series model Linear Regression Causal model 17
11 Forecasting Techniques- Cont. Components of Time Series- Data should be plotted to detect for the following components: Trend variations: either increasing or decreasing Cyclical variations: wavelike movements that are longer than a year Seasonal variations: show peaks and valleys that repeat over a consistent interval such as hours, days, weeks, months, years, or seasons Random variations: due to unexpected or unpredictable events 18
12 Forecasting Techniques- Cont. Time Series Forecasting Models Simple Moving Average Forecasting Model. Simple moving average forecasting method uses historical data to generate a forecast. Works well when demand is fairly stable over time. 19
13 Moving Average Method Calculations 20
14 Sales of Washing Machine at Arvee Electronics 21
15 Forecasting Techniques- Cont. PEMP-EMM
16 Forecasting Techniques- Cont. Time Series Forecasting Models Weighted Moving Average Forecasting Model- Whenever there is a detectable trend or pattern, in order to be responsive, weights can be used. 23
17 24
18 25
19 Forecasting Techniques- Cont. PEMP-EMM
20 Disadvantage of moving average Lengthy calculations involved Need to keep historical Data Equal weightage or no basis for weightage for the Data To overcome these difficulties, exponential smoothing is used 27
21 Forecasting Techniques- Cont. PEMP-EMM2506 Time Series Forecasting Models Exponential Smoothing Forecasting Model- a weighted moving average in which the forecast for the next period s demand is the current period s forecast adjusted by a fraction of the difference between the current period s actual demand and its forecast. Only two data points are needed. Ft+1 = Ft+ (At-Ft) Where Ft+1 = forecast for Period t + 1 Ft = forecast for Period t At = actual demand for Period t = a smoothing constant (0 1). = 2/(N+1) Where N= period of moving average ; Typically 0.1 to
22 29
23 Forecasting Techniques- Cont. 30
24 Trend Projections Least square method for finding the best-fitting line 31
25 Least Square Method 32
26 An Example 33
27 34
28 Seasonal Variations in Data Monthly sales and demand of IBM notebook computer in Bangalore is as shown below for Calculate 2001 demand for selling 1200 notebooks. Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Sale Demand
29 Create a table in this format Month Sale 1999 Demand 2000 Avg Avg. Monthly Demand Avg. Seasonal Index 36
30 37
31 IBM Notebook exercise Contd 38
32 39
33 Causal Forecasting Model -Regression Analysis 40
34 Causal Forecasting Model Consider s several variables that are related Explain s cause of time series Ex: Sale of a product depends on: Firm s Advertising budget Price charged Competitor s price Promotional Strategies etc. Regression Analysis is a tool to develop causal model 41
35 Forecasting Techniques- Cont. Associative Forecasting Models- One or several external variables are identified that are related to demand Simple (linear) regression. Only one explanatory variable is used and is similar to the previous trend model. The difference is that the x variable is no longer a time but an explanatory or independent variable. Ŷ = a + b 1 x where Ŷ = forecast or dependent variable x = explanatory or independent variable a = y-axis intercept of the line b 1 = slope of the line 42
36 Forecasting Techniques- Cont. Associative Forecasting Models- Multiple regression. Where several explanatory variables are used to make the forecast. Ŷ = a + b 1 x 1 + b 2 x b k x k where Ŷ = forecast or dependent variable x k = k th explanatory or independent variable a = Y-axis intercept of the line b k = regression coefficient of the independent variable x k 43
37 44
38 Scatter Diagram 45
39 46
40 47
41 Forecast Accuracy PEMP-EMM2506 The formula for forecast error, defined as the difference between actual demand and the forecast, follows: Forecast error, e t = A t - F t where e t = forecast error for Period t A t = actual demand for Period t F t = forecast for Period t Several measures of forecasting accuracy follow: Mean absolute deviation (MAD)- a MAD of 0 indicates the forecast = predicted demand. = (forecast error) / n, where n is number of period. 48
42 Formulae for Monitoring and Controlling forecast MAD = ( Sum of forecast errors / n ). Mean squared error (MSE) = ( ( Sum of forecast error ) 2 / n ). 49
43 Aggregate Planning 50
44 Introduction Aggregate planning is done for period of 6 to 18 months It translates business plan and strategic intent to operational decisions Purpose is to specify combination of production rate, workforce and inventory in hand needed In planning total expected demand is reckoned without regard to product mix that makes up the figure 51
45 Aggregate Planning What is it? Once long term decisions are made, it is necessary to make intermediate range plans that are consistent with long-range policies Management must work within the resources allocated by long-range decisions Given the sales forecasts, the factory capacity, aggregate inventory levels, and the size of the workforce, the manager must decide at what rate of production to operate the plant over the intermediate term This intermediate-range planning is generally known as aggregate planning 52
46 Why Aggregate Planning is necessary? Fully load facilities and minimize overloading and underloading Make sure enough capacity available to satisfy expected demand Plan for the orderly and systematic change of production capacity to meet the peaks and valleys of expected customer demand Get the most output for the amount of resources available 53
47 Why Aggregate Planning necessary? To meet demand fluctuations like in festivals Capacity fluctuations Number of working days in month, unexpected shutdowns.. Production rate cannot be changed without proper planning Planning helps to manage anticipated demand 54
48 Aggregate Planning Purpose Aggregate plans and master schedules provide common points at which capacity and inventories are considered jointly in the light of firm s longrange plans, and they provide inputs to the financial plan, the marketing plan, and requirements planning and detailed scheduling decisions Several crucial decisions have to be made while generating an aggregate plan Management may ask many inventory- and workforce- related questions To what extent should inventories be used for absorbing changes in demand that might occur during the intermediate term? Should we absorb the fluctuations by varying the size of the workforce* Generally a mixture of strategies is preferred and is feasible An aggregate plan is a valuable procedure to help in the development of operating budgets 55
49 Aggregate Planning Purpose Products or services can be aggregated into a set of relatively broad product families without getting into too much of detail A company can organize labour in various ways based on flexibility to handle different products/services, or, based on product lines When time is considered, the planning horizon is an important aspect. It is the length of time covered by an aggregate plan. A company will usually look at time in the aggregate months, quarters, or seasons (rather than days or hours) Some companies use monthly planning periods for the near portion of the planning horizon and quarterly periods for the later portion 56
50 Aggregate Planning Purpose In practice, planning periods reflect a balance between the needs for a limited number of decision points to reduce planning complexity flexibility to adjust output rates and the workforce levels when demand forecasts exhibit seasonal variations Relationship of aggregate to other plans is in figure below Business or Annual plan Aggregate plan MPS or Workforce schedule 57
51 Aggregate Planning Managerial inputs from various functional areas to aggregate plans Operations Current, future & workforce capacities Materials Supplier capabilities Storage capacity Materials availability Distribution and Marketing Customer needs, Demand, Competition Aggregate plan Engineering New products, design changes machine standards Accounting and Finance Cost data, financial Condition of firm Human resources Labour market Conditions, training capacity 58
52 Aggregate planning process The process for preparing aggregate plans is dynamic and continuing, as aspects of the plan are updated periodically when new information becomes available and new opportunities emerge* The steps are: Determining demand requirements Identifying alternatives, constraints and costs Preparing an acceptable plan Implementing and updating the plan 59
53 Aggregate planning process The process flow chart Determine requirements for planning horizon Identify alternatives, constraints and costs Prepare prospective plan for planning horizon Move ahead to Next planning session Implement and update the plan No Is the plan acceptable? Yes 60
54 Aggregate planning process Determining demand requirements The first step in the planning process is to determine the demand requirements for each period of the planning horizon For production plans, the requirements represent the demand for finished goods and the external demand for replacement parts For staffing plans, the planner bases forecasts of staff requirements for each workforce group on historical levels of demand, managerial judgment and existing backlogs for services 61
55 Aggregate planning process Identifying alternatives, constraints and costs Constraints represent physical limitations or managerial policies associated with the aggregate plan Examples of physical constraints might include training facilities capable of handling only so many new hires at a time, machine capacities that limit maximum output, or inadequate inventory storage space A planner usually considers several types of costs when preparing aggregate plans Regular-time costs Overtime costs typically 150% of regular time wages Hiring (advertising jobs, interviews, etc.) and layoff (exit interviews, severance pay, etc.) costs 62
56 Aggregate planning process Identifying alternatives, constraints and costs A planner usually considers several types of costs. Inventory holding costs that vary with the level of inventory investment: the costs of capital tied up in inventory, variable storage and warehousing, etc. Backorder and stock out costs like the costs of lost sales and the potential cost of losing the customer s sales to competitors Hiring (advertising jobs, interviews, etc.) and layoff (exit interviews, severance pay, etc.) costs Preparing an acceptable plan This is an iterative process (plans may need to go through several revisions and adjustments Implementing and updating the plan which requires the commitment of all functional area managers 63
57 Aggregate planning process Developing and evaluating the level production plan One possible level strategy, which uses a constant number of employees that will satisfy demand during the planning horizon, is determined by using the maximum amount of overtime in the peak period Under time is used in slack periods Level strategy can lead to considerable under time Cost of this unused capacity depends on whether under time is paid or unpaid The planning can be done with a spreadsheet^ Example problem follows 64
58 Aggregate planning Details A manufacturing firm s aggregate plan, called a production plan focusses on production rates and inventory holdings A service firm s aggregate plan, called a staffing plan, centers on staffing and other labour related factors Based on the long-term goals of a company, the aggregate plan specifies how the company will work for the next year or so toward these goals within existing equipment and facility capacity constraints For manufacturing companies, the aggregate plan links strategic goals and objectives with production plans for individual products and the specific components that go into them 65
59 Aggregate Planning Details For service firms the aggregate plan links strategic goals with detailed workforce schedules When we say aggregate, the sense is that the planning activities at this early stage are concerned with homogeneous categories, such as gross volumes of products or number of customers served Illustration below gives the aggregate plan of a motor manufacturer 66
60 Aggregate planning Strategies Many aggregate planning strategies are available to the manager The many functional areas in an organization that give input to the aggregate plan typically have conflicting objectives for the use of the organization s resources The objectives could be: Minimize costs/maximize profits If customer demand is not affected by the plan, minimizing costs will also maximize profits Maximize customer service Improving delivery time and on-time delivery may require additional workforce, machine capacity, or inventory resources Minimize inventory investment Inventory accumulations are expensive because the money could be used for more productive investments Maximize utilization of plant and equipment Processes based on a line flow strategy require uniformly high utilization of plant and equipment 67
61 Aggregate planning PEMP-EMM2506 Strategies The objectives (cont d): Minimize changes in production rates Frequent changes in production rates can cause difficulties in coordinating the supplies of materials and require production line rebalancing Minimize changes in workforce levels Fluctuating workforce levels may cause lower productivity because new employees typically need time to become fully productive Balancing these various objectives to arrive at an acceptable aggregate plan involves consideration of various alternatives A classification scheme is shown in the next slide 68
62 Aggregate planning-meeting Demand Pure Strategy : One of the variable say workforce is changed to absorb demand fluctuation Mixed Strategy : Here more than one variable say workforce and inventory are changed to absorb fluctuations This is mostly used in Industries 69
63 Aggregate planning-meeting demand Chase Strategy : Match the production rate needed by hiring and laying off employees as the order rate varies. For this pool of trained people must be available as volume increases. Has motivational issues. 70
64 Aggregate planning-meeting Demand Level Strategy : Making a stable workforce working at constant output rate. Shortages and surpluses are absorbed by fluctuating inventory levels, order backlogs and lost sales. Potential implication decreased customer service level and increased inventory costs 71
65 Aggregate Planning-Meeting Demand Stable workforce Variable work hours : Vary the output by varying number of hours worked through flexible work schedules or overtime. Better employee motivation. Overtime cost extra 72
66 Medium-Term Capacity Adjustments Workforce level Hire or layoff full-time workers Hire or layoff part-time workers Hire or layoff contract workers Utilization of the work force Overtime Idle time (under time) Reduce hours worked... more 73
67 Medium-Term Capacity Adjustments Inventory level Finished goods inventory Backorders/lost sales Subcontract 74
68 Aggregate Plans for services For standardized services, aggregate planning may be simpler than in systems that produce products For customized services, there may be difficulty in specifying the nature and extent of services to be performed for each customer customer may be an integral part of the production system Absence of finished-goods inventories as a buffer between system capacity and customer demand 75
69 Yield Management It is a process of allocating right type of capacity to the right type of customer at the right price and time to maximize revenue or yield E.g. :- Airlines booking in advance at cheaper prices - Hotel booking in advance 76
70 Yield Management Yield Management is most effective when : Demand can be segmented by customer Fixed costs are high and variable costs are low Inventory is perishable Product can be sold in advance Demand is highly variable 77
71 Session Summary Analysing demand forecasts has been explained Time series and causal models have been demonstrated with examples. Strategies adopted in aggregate planning has been elucidated 80
Production Planning & Control. Chapter 2. Aggregate Planning & Master Production Scheduling. Chapter2 1
Production Planning & Control Chapter 2 Aggregate Planning & Master Production Scheduling Chapter2 1 Aggregate Planning & Master Production Scheduling W hy Aggregate Planning Is Necessary Fully load facilities
More informationIndustry Environment and Concepts for Forecasting 1
Table of Contents Industry Environment and Concepts for Forecasting 1 Forecasting Methods Overview...2 Multilevel Forecasting...3 Demand Forecasting...4 Integrating Information...5 Simplifying the Forecast...6
More informationProduction Planning. Chapter 4 Forecasting. Overview. Overview. Chapter 04 Forecasting 1. 7 Steps to a Forecast. What is forecasting?
Chapter 4 Forecasting Production Planning MRP Purchasing Sales Forecast Aggregate Planning Master Production Schedule Production Scheduling Production What is forecasting? Types of forecasts 7 steps of
More informationUniversidad del Turabo MANA 705 DL Workshop Eight W8_8_3 Aggregate Planning, Material Requirement Planning, and Capacity Planning
Aggregate, Material Requirement, and Capacity Topic: Aggregate, Material Requirement, and Capacity Slide 1 Welcome to Workshop Eight presentation: Aggregate planning, material requirement planning, and
More informationAggregate Planning. Planning Process. Aggregate. Capacity options. Demand options. Five questions of aggregate planning. Scheduling Decisions
Aggregate Planning Planning Process Scheduling Decisions Operations Management Chapter 13 Short range Medium range Long range Chris Schrage OPS 13 2 Aggregate Combining appropriate resources into general
More informationPlanning and Scheduling Operations in Dynamic Supply Chain
Planning and Scheduling Operations in Dynamic Supply Chain Sung Joo Bae Assistant Professor Yonsei University 14 1 Supply Chain Management 14 2 Supply Chains Tier 3 Poland USA Canada Australia Malaysia
More informationCHAPTER 11 FORECASTING AND DEMAND PLANNING
OM CHAPTER 11 FORECASTING AND DEMAND PLANNING DAVID A. COLLIER AND JAMES R. EVANS 1 Chapter 11 Learning Outcomes l e a r n i n g o u t c o m e s LO1 Describe the importance of forecasting to the value
More informationForecasting the first step in planning. Estimating the future demand for products and services and the necessary resources to produce these outputs
PRODUCTION PLANNING AND CONTROL CHAPTER 2: FORECASTING Forecasting the first step in planning. Estimating the future demand for products and services and the necessary resources to produce these outputs
More informationCALL VOLUME FORECASTING FOR SERVICE DESKS
CALL VOLUME FORECASTING FOR SERVICE DESKS Krishna Murthy Dasari Satyam Computer Services Ltd. This paper discusses the practical role of forecasting for Service Desk call volumes. Although there are many
More informationOutline: Demand Forecasting
Outline: Demand Forecasting Given the limited background from the surveys and that Chapter 7 in the book is complex, we will cover less material. The role of forecasting in the chain Characteristics of
More informationSmoothing methods. Marzena Narodzonek-Karpowska. Prof. Dr. W. Toporowski Institut für Marketing & Handel Abteilung Handel
Smoothing methods Marzena Narodzonek-Karpowska Prof. Dr. W. Toporowski Institut für Marketing & Handel Abteilung Handel What Is Forecasting? Process of predicting a future event Underlying basis of all
More information1 Aggregate Production Planning
IEOR 4000: Production Management Lecture 5 Professor Guillermo Gallego 9 October 2001 1 Aggregate Production Planning Aggregate production planning is concerned with the determination of production, inventory,
More informationASPECTS OF AGGREGATE PLANNING. Aggregate planning focuses on intermediate-rang production planning problems.
ASPECTS OF AGGREGATE PLANNING Aggregate planning focuses on intermediate-rang production planning problems. The aggregate production plan states in general terms the total amount of output that is the
More informationModule 6: Introduction to Time Series Forecasting
Using Statistical Data to Make Decisions Module 6: Introduction to Time Series Forecasting Titus Awokuse and Tom Ilvento, University of Delaware, College of Agriculture and Natural Resources, Food and
More informationAGGREGATE & CAPACITY PLANNING
7 Ir. Haery Sihombing/IP Pensyarah Fakulti Kejuruteraan Pembuatan Universiti Teknologi Malaysia Melaka AGGREGATE & CAPACITY PLANNING Aggregate Planning Determine the resource capacity needed to meet demand
More informationExponential Smoothing with Trend. As we move toward medium-range forecasts, trend becomes more important.
Exponential Smoothing with Trend As we move toward medium-range forecasts, trend becomes more important. Incorporating a trend component into exponentially smoothed forecasts is called double exponential
More informationCHAPTER 6 FINANCIAL FORECASTING
TUTORIAL NOTES CHAPTER 6 FINANCIAL FORECASTING 6.1 INTRODUCTION Forecasting represents an integral part of any planning process that is undertaken by all firms. Firms must make decisions today that will
More informationSection A. Index. Section A. Planning, Budgeting and Forecasting Section A.2 Forecasting techniques... 1. Page 1 of 11. EduPristine CMA - Part I
Index Section A. Planning, Budgeting and Forecasting Section A.2 Forecasting techniques... 1 EduPristine CMA - Part I Page 1 of 11 Section A. Planning, Budgeting and Forecasting Section A.2 Forecasting
More information2) The three categories of forecasting models are time series, quantitative, and qualitative. 2)
Exam Name TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false. 1) Regression is always a superior forecasting method to exponential smoothing, so regression should be used
More informationFORECASTING. Operations Management
2013 FORECASTING Brad Fink CIT 492 Operations Management Executive Summary Woodlawn hospital needs to forecast type A blood so there is no shortage for the week of 12 October, to correctly forecast, a
More informationOutline. Role of Forecasting. Characteristics of Forecasts. Logistics and Supply Chain Management. Demand Forecasting
Logistics and Supply Chain Management Demand Forecasting 1 Outline The role of forecasting in a supply chain Characteristics ti of forecasts Components of forecasts and forecasting methods Basic approach
More informationObjectives of Chapters 7,8
Objectives of Chapters 7,8 Planning Demand and Supply in a SC: (Ch7, 8, 9) Ch7 Describes methodologies that can be used to forecast future demand based on historical data. Ch8 Describes the aggregate planning
More informationTEACHING AGGREGATE PLANNING IN AN OPERATIONS MANAGEMENT COURSE
TEACHING AGGREGATE PLANNING IN AN OPERATIONS MANAGEMENT COURSE Johnny C. Ho, Turner College of Business, Columbus State University, Columbus, GA 31907 David Ang, School of Business, Auburn University Montgomery,
More informationCOMPARISON OF FIXED & VARIABLE RATES (25 YEARS) CHARTERED BANK ADMINISTERED INTEREST RATES - PRIME BUSINESS*
COMPARISON OF FIXED & VARIABLE RATES (25 YEARS) 2 Fixed Rates Variable Rates FIXED RATES OF THE PAST 25 YEARS AVERAGE RESIDENTIAL MORTGAGE LENDING RATE - 5 YEAR* (Per cent) Year Jan Feb Mar Apr May Jun
More informationCOMPARISON OF FIXED & VARIABLE RATES (25 YEARS) CHARTERED BANK ADMINISTERED INTEREST RATES - PRIME BUSINESS*
COMPARISON OF FIXED & VARIABLE RATES (25 YEARS) 2 Fixed Rates Variable Rates FIXED RATES OF THE PAST 25 YEARS AVERAGE RESIDENTIAL MORTGAGE LENDING RATE - 5 YEAR* (Per cent) Year Jan Feb Mar Apr May Jun
More informationDemand Forecasting LEARNING OBJECTIVES IEEM 517. 1. Understand commonly used forecasting techniques. 2. Learn to evaluate forecasts
IEEM 57 Demand Forecasting LEARNING OBJECTIVES. Understand commonly used forecasting techniques. Learn to evaluate forecasts 3. Learn to choose appropriate forecasting techniques CONTENTS Motivation Forecast
More informationIT S ALL ABOUT THE CUSTOMER FORECASTING 101
IT S ALL ABOUT THE CUSTOMER FORECASTING 101 Ed White CPIM, CIRM, CSCP, CPF, LSSBB Chief Value Officer Jade Trillium Consulting April 01, 2015 Biography Ed White CPIM CIRM CSCP CPF LSSBB is the founder
More informationAT&T Global Network Client for Windows Product Support Matrix January 29, 2015
AT&T Global Network Client for Windows Product Support Matrix January 29, 2015 Product Support Matrix Following is the Product Support Matrix for the AT&T Global Network Client. See the AT&T Global Network
More informationForecasting Methods. What is forecasting? Why is forecasting important? How can we evaluate a future demand? How do we make mistakes?
Forecasting Methods What is forecasting? Why is forecasting important? How can we evaluate a future demand? How do we make mistakes? Prod - Forecasting Methods Contents. FRAMEWORK OF PLANNING DECISIONS....
More informationIT-375 using the 6 th Edition PRODUCTION AND INVENTORY CONTROL CHAPTER 1: INTRODUCTION TO MATERIALS MANAGEMENT
IT-375 using the 6 th Edition PRODUCTION AND INVENTORY CONTROL CHAPTER 1: INTRODUCTION TO MATERIALS MANAGEMENT What is wealth? GDP = production = profits What is the source of wealth? The conversion process
More informationSolution-Driven Integrated Learning Paths. Make the Most of Your Educational Experience. Live Learning Center
Solution-Driven Integrated Learning Paths Educational Sessions Lean Global Supply Chain Basics of Operation Management Demand Management, Forecasting, and S & OP Professional Advancement Special Interest
More information3 SYSTEMS DESIGN AND CAPACITY
Systems Design and Capacity 53 3 SYSTEMS DESIGN AND CAPACITY CHAPTER OUTLINE 3.1 Introduction 3.2 Manufacturing and Service Systems 3.3 Design and Systems Capacity 3.4 Capacity Planning 3.5 Process of
More informationThe Strategic Role of Forecasting in Supply Chain Management and TQM
Forecasting A forecast is a prediction of what will occur in the future. Meteorologists forecast the weather, sportscasters and gamblers predict the winners of football games, and companies attempt to
More informationMOS 3330 Test 2 Review Problems & Solutions
MOS 3330 Test 2 Review Problems & Solutions General Information Test date, time, location: See the course outline See also the course web site: dan.uwo.ca/courses/3330 Test time conflict (due to having
More informationCh.3 Demand Forecasting.
Part 3 : Acquisition & Production Support. Ch.3 Demand Forecasting. Edited by Dr. Seung Hyun Lee (Ph.D., CPL) IEMS Research Center, E-mail : lkangsan@iems.co.kr Demand Forecasting. Definition. An estimate
More informationCHAPTER 6 AGGREGATE PLANNING AND INVENTORY MANAGEMENT 명지대학교 산업시스템공학부
CHAPTER 6 AGGREGATE PLANNING AND INVENTORY MANAGEMENT 명지대학교 산업시스템공학부 Learning Objectives You should be able to: Describe the hierarchical operations planning process in terms of materials planning & capacity
More informationDemand Forecasting When a product is produced for a market, the demand occurs in the future. The production planning cannot be accomplished unless
Demand Forecasting When a product is produced for a market, the demand occurs in the future. The production planning cannot be accomplished unless the volume of the demand known. The success of the business
More informationA Primer on Forecasting Business Performance
A Primer on Forecasting Business Performance There are two common approaches to forecasting: qualitative and quantitative. Qualitative forecasting methods are important when historical data is not available.
More informationProject Cost & Schedule Monitoring Process Using MS Excel & MS Project
Project Cost & Schedule Monitoring Process Using MS Excel & MS Project Presented by: Rajesh Jujare About Us Solutions is founded with objectives a. To share its expertise and experiences to overcome the
More informationHow To Plan A Pressure Container Factory
ScienceAsia 27 (2) : 27-278 Demand Forecasting and Production Planning for Highly Seasonal Demand Situations: Case Study of a Pressure Container Factory Pisal Yenradee a,*, Anulark Pinnoi b and Amnaj Charoenthavornying
More informationForecasting DISCUSSION QUESTIONS
4 C H A P T E R Forecasting DISCUSSION QUESTIONS 1. Qualitative models incorporate subjective factors into the forecasting model. Qualitative models are useful when subjective factors are important. When
More informationTheory at a Glance (For IES, GATE, PSU)
1. Forecasting Theory at a Glance (For IES, GATE, PSU) Forecasting means estimation of type, quantity and quality of future works e.g. sales etc. It is a calculated economic analysis. 1. Basic elements
More informationINCREASING FORECASTING ACCURACY OF TREND DEMAND BY NON-LINEAR OPTIMIZATION OF THE SMOOTHING CONSTANT
58 INCREASING FORECASTING ACCURACY OF TREND DEMAND BY NON-LINEAR OPTIMIZATION OF THE SMOOTHING CONSTANT Sudipa Sarker 1 * and Mahbub Hossain 2 1 Department of Industrial and Production Engineering Bangladesh
More informationWeek TSX Index 1 8480 2 8470 3 8475 4 8510 5 8500 6 8480
1) The S & P/TSX Composite Index is based on common stock prices of a group of Canadian stocks. The weekly close level of the TSX for 6 weeks are shown: Week TSX Index 1 8480 2 8470 3 8475 4 8510 5 8500
More informationSlides Prepared by JOHN S. LOUCKS St. Edward s University
s Prepared by JOHN S. LOUCKS St. Edward s University 2002 South-Western/Thomson Learning 1 Chapter 18 Forecasting Time Series and Time Series Methods Components of a Time Series Smoothing Methods Trend
More informationContracts. David Simchi-Levi. Professor of Engineering Systems
Introduction to Stochastic Inventory Models and Supply Contracts David Simchi-Levi Professor of Engineering Systems Massachusetts Institute of Technology Introduction Outline of the Presentation The Effect
More informationUse of Statistical Forecasting Methods to Improve Demand Planning
Use of Statistical Forecasting Methods to Improve Demand Planning Talk given at the Swiss Days of Statistics 2004 Aarau, November 18th, 2004 Marcel Baumgartner marcel.baumgartner@nestle.com Nestec 1800
More informationCase 2:08-cv-02463-ABC-E Document 1-4 Filed 04/15/2008 Page 1 of 138. Exhibit 8
Case 2:08-cv-02463-ABC-E Document 1-4 Filed 04/15/2008 Page 1 of 138 Exhibit 8 Case 2:08-cv-02463-ABC-E Document 1-4 Filed 04/15/2008 Page 2 of 138 Domain Name: CELLULARVERISON.COM Updated Date: 12-dec-2007
More informationAn Analysis of Inventory Management of T-Shirt at Mahanagari Bandung Pisan
www.sbm.itb.ac.id/ajtm The Asian Journal of Technology Management Vol. 3 No. 2 (2010) 92-109 An Analysis of Inventory Management of T-Shirt at Mahanagari Bandung Pisan Togar M. Simatupang 1 *, Nidia Jernih
More informationForecasting. Sales and Revenue Forecasting
Forecasting To plan, managers must make assumptions about future events. But unlike Harry Potter and his friends, planners cannot simply look into a crystal ball or wave a wand. Instead, they must develop
More informationMethodology For Illinois Electric Customers and Sales Forecasts: 2016-2025
Methodology For Illinois Electric Customers and Sales Forecasts: 2016-2025 In December 2014, an electric rate case was finalized in MEC s Illinois service territory. As a result of the implementation of
More informationEnhanced Vessel Traffic Management System Booking Slots Available and Vessels Booked per Day From 12-JAN-2016 To 30-JUN-2017
From -JAN- To -JUN- -JAN- VIRP Page Period Period Period -JAN- 8 -JAN- 8 9 -JAN- 8 8 -JAN- -JAN- -JAN- 8-JAN- 9-JAN- -JAN- -JAN- -JAN- -JAN- -JAN- -JAN- -JAN- -JAN- 8-JAN- 9-JAN- -JAN- -JAN- -FEB- : days
More informationA Cross-Functional View of Inventory Management, Why Collaboration among Marketing, Finance/Accounting and Operations Management is Necessary
A Cross-Functional View of Inventory Management, Why Collaboration among Marketing, Finance/Accounting and Operations Management is Necessary Richard E. Crandall, Appalachian State University, John A.
More informationChapter 4 SUPPLY CHAIN PERFORMANCE MEASUREMENT USING ANALYTIC HIERARCHY PROCESS METHODOLOGY
Chapter 4 SUPPLY CHAIN PERFORMANCE MEASUREMENT USING ANALYTIC HIERARCHY PROCESS METHODOLOGY This chapter highlights on supply chain performance measurement using one of the renowned modelling technique
More informationOperations Management. 3.3 Justify the need for Operational Planning and Control in a selected Production Process
Operations Management 3.3 Justify the need for Operational Planning and Control in a selected Production Process Key Topics LO3 Understand how to organise a typical production process 3.3 justify the need
More informationSchool of Management and Languages Capacity Planning
School of Management and Languages Capacity Planning Dr Neil Towers 1 Learning Objectives a. To understand Capacity Planning and Control b. To manage the supply chain capabilities effectively Dr Neil Towers
More informationMGT 267 PROJECT. Forecasting the United States Retail Sales of the Pharmacies and Drug Stores. Done by: Shunwei Wang & Mohammad Zainal
MGT 267 PROJECT Forecasting the United States Retail Sales of the Pharmacies and Drug Stores Done by: Shunwei Wang & Mohammad Zainal Dec. 2002 The retail sale (Million) ABSTRACT The present study aims
More informationLinear Programming Supplement E
Linear Programming Supplement E Linear Programming Linear programming: A technique that is useful for allocating scarce resources among competing demands. Objective function: An expression in linear programming
More informationAgenda. Managing Uncertainty in the Supply Chain. The Economic Order Quantity. Classic inventory theory
Agenda Managing Uncertainty in the Supply Chain TIØ485 Produkjons- og nettverksøkonomi Lecture 3 Classic Inventory models Economic Order Quantity (aka Economic Lot Size) The (s,s) Inventory Policy Managing
More informationINVENTORY MANAGEMENT. 1. Raw Materials (including component parts) 2. Work-In-Process 3. Maintenance/Repair/Operating Supply (MRO) 4.
INVENTORY MANAGEMENT Inventory is a stock of materials and products used to facilitate production or to satisfy customer demand. Types of inventory include: 1. Raw Materials (including component parts)
More information16 : Demand Forecasting
16 : Demand Forecasting 1 Session Outline Demand Forecasting Subjective methods can be used only when past data is not available. When past data is available, it is advisable that firms should use statistical
More informationExecutive summary. Table of Contents. How to meet peaks in demand. White Paper Optimize food & beverage manufacturing
White Paper Optimize food & beverage manufacturing How to meet peaks in demand Executive summary. Fluctuations in demand levels are a challenge faced by most food and beverage manufacturers. The two major
More informationTime series forecasting
Time series forecasting 1 The latest version of this document and related examples are found in http://myy.haaga-helia.fi/~taaak/q Time series forecasting The objective of time series methods is to discover
More informationProject Management Planning
Overview of Resource Planning Every organization has a limited number of resources to perform tasks. A project manager's primary role is to find a way to successfully execute a project within these resource
More informationAnalysis One Code Desc. Transaction Amount. Fiscal Period
Analysis One Code Desc Transaction Amount Fiscal Period 57.63 Oct-12 12.13 Oct-12-38.90 Oct-12-773.00 Oct-12-800.00 Oct-12-187.00 Oct-12-82.00 Oct-12-82.00 Oct-12-110.00 Oct-12-1115.25 Oct-12-71.00 Oct-12-41.00
More informationA SAS/ETS SOFTWARE FORECASTING AND INVENTORY PLANNING SYSTEM
A SAS/ETS SOFTWARE FORECASTING AND INVENTORY PLANNING SYSTEM Patrick Cardamone. Jersey Central Power & Light Company David Brauer Jersey Central Power & Light Company Introduction Jersey Central Power
More informationTelephone Traffic Queues in a Customer Call Center. A Thesis. Presented for the. Master of Science Degree. The University of Tennessee at Chattanooga
Telephone Traffic Queues in a Customer Call Center A Thesis Presented for the Master of Science Degree The University of Tennessee at Chattanooga Patrick Todd April 2009 Copyright 2009 by Patrick Todd
More informationC H A P T E R Forecasting statistical fore- casting methods judgmental forecasting methods 27-1
27 C H A P T E R Forecasting H ow much will the economy grow over the next year? Where is the stock market headed? What about interest rates? How will consumer tastes be changing? What will be the hot
More informationA Comparative Study of the Pickup Method and its Variations Using a Simulated Hotel Reservation Data
A Comparative Study of the Pickup Method and its Variations Using a Simulated Hotel Reservation Data Athanasius Zakhary, Neamat El Gayar Faculty of Computers and Information Cairo University, Giza, Egypt
More informationCourse 2: Financial Planning and Forecasting
Excellence in Financial Management Course 2: Financial Planning and Forecasting Prepared by: Matt H. Evans, CPA, CMA, CFM This course provides a basic understanding of how to prepare a financial plan (budgeted
More informationNeed to know finance
Need to know finance You can t hide from it Every decision has financial implications Estimating sales and cost of sales (aka direct costs) Gross Profit and Gross Profit Margin (GPM) Sales cost of sales
More informationCPA Mock Evaluation Management Accounting Module (Core 2) Page 1
CPA Mock Evaluation Management Accounting Module (Core 2) Page 1 Overview The Core 1 and 2 examinations are a mix of objective format and case questions. The maximum length for an individual case will
More informationSupply Chain Management (3rd Edition)
Supply Chain Management (3rd Edition) Chapter 9 Planning Supply and Demand in a Supply Chain: Managing Predictable Variability 9-1 Outline Responding to predictable variability in a supply chain Managing
More informationOBJECTIVE ASSESSMENT OF FORECASTING ASSIGNMENTS USING SOME FUNCTION OF PREDICTION ERRORS
OBJECTIVE ASSESSMENT OF FORECASTING ASSIGNMENTS USING SOME FUNCTION OF PREDICTION ERRORS CLARKE, Stephen R. Swinburne University of Technology Australia One way of examining forecasting methods via assignments
More informationComprehensive Business Budgeting
Management Accounting 137 Comprehensive Business Budgeting Goals and Objectives Profit planning, commonly called master budgeting or comprehensive business budgeting, is one of the more important techniques
More informationComparative Study of Demand Forecast Accuracy for Healthcare Products Using Linear and Non Linear Regression
International Journal of Business and Management Invention ISSN (Online): 2319 8028, ISSN (Print): 2319 801X Volume 3 Issue 5ǁ May. 2014 ǁ PP.01-10 Comparative Study of Demand Forecast Accuracy for Healthcare
More informationMANAGEMENT OF OPERATIONS STOCK MANAGEMENT
MANAGEMENT OF OPERATIONS STOCK MANAGEMENT LEARNING INTENTIONS AND SUCCESS CRITERIA LEARNING INTENTIONS: I understand what is involved in effective stock management. SUCCESS CRITERIA: I can describe the
More informationManagement of Uncertainty In Supply Chain
Management of Uncertainty In Supply Chain Prof.D.P.Patil 1, Prof.A.P.Shrotri 2, Prof.A.R.Dandekar 3 1,2,3 Associate Professor, PVPIT (BUDHGAON), Dist. Sangli(M.S.) sdattatrayap_patil@yahoo.co.in amod_shrotri@rediffmail.com
More informationSSgA CAPITAL INSIGHTS
SSgA CAPITAL INSIGHTS viewpoints Part of State Street s Vision thought leadership series A Stratified Sampling Approach to Generating Fixed Income Beta PHOTO by Mathias Marta Senior Investment Manager,
More informationTIME SERIES ANALYSIS & FORECASTING
CHAPTER 19 TIME SERIES ANALYSIS & FORECASTING Basic Concepts 1. Time Series Analysis BASIC CONCEPTS AND FORMULA The term Time Series means a set of observations concurring any activity against different
More information20 Forecasting. e-text Main Menu Textbook Table of Contents
20 Forecasting How much will the economy grow over the next year? Where is the stock market headed? What about interest rates? How will consumer tastes be changing? What will be the hot new products? Forecasters
More informationFixed Income 2015 Update. Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research
Fixed Income 2015 Update Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research 1 Fed: Slow and Low 2015 Fixed Income Outlook 2 Yield Curve Flattening 3
More informationForecasting Methods / Métodos de Previsão Week 1
Forecasting Methods / Métodos de Previsão Week 1 ISCTE - IUL, Gestão, Econ, Fin, Contab. Diana Aldea Mendes diana.mendes@iscte.pt February 3, 2011 DMQ, ISCTE-IUL (diana.mendes@iscte.pt) Forecasting Methods
More informationSimple Inventory Management
Jon Bennett Consulting http://www.jondbennett.com Simple Inventory Management Free Up Cash While Satisfying Your Customers Part of the Business Philosophy White Papers Series Author: Jon Bennett September
More informationBusiness Idea Development Product production Services. Development Project. Software project management
Page 1, 1/20/2003 Ivica Crnkovic Mälardalen University Department of Computer Engineering ivica.crnkovic@mdh.se Development Project Product Lifecycle Business Idea Development Product production Services
More informationCOST ACCOUNTING STANDARD ON OVERHEADS
COST ACCOUNTING STANDARD ON OVERHEADS The following is the text of the COST ACCOUNTING STANDARD 3 (CAS- 3) issued by the Council of the Institute of Cost and Works Accountants of India on Overheads. The
More informationGESTION DE LA PRODUCTION ET DES OPERATIONS PICASSO EXERCICE INTEGRE
ECAP 21 / PROD2100 GESTION DE LA PRODUCTION ET DES OPERATIONS PICASSO EXERCICE INTEGRE 2004-2005 Prof : Pierre Semal : semal@poms.ucl.ac.be Assistants : Eléonore de le Court : delecourt@poms.ucl.ac.be
More informationDeveloping Effective Metrics for Supply Management
Developing Effective Metrics for Supply Management Carol Marks, Director of Purchasing Industrial Distribution Group 7-398-5666; carol.l.marks@idg-com William McNeese, Partner Business Process Improvement
More informationS&OP Case Study Creating Value at O Neal Manufacturing Services. Anthony Zampello, CPIM, CIRM, CSCP Adjunct Faculty Bentley University
S&OP Case Study Creating Value at O Neal Manufacturing Services Anthony Zampello, CPIM, CIRM, CSCP Adjunct Faculty Bentley University Prepared by: Jamie Cochran, Strategic Business Applications Manager,
More informationIndian School of Business Forecasting Sales for Dairy Products
Indian School of Business Forecasting Sales for Dairy Products Contents EXECUTIVE SUMMARY... 3 Data Analysis... 3 Forecast Horizon:... 4 Forecasting Models:... 4 Fresh milk - AmulTaaza (500 ml)... 4 Dahi/
More informationUsing INZight for Time series analysis. A step-by-step guide.
Using INZight for Time series analysis. A step-by-step guide. inzight can be downloaded from http://www.stat.auckland.ac.nz/~wild/inzight/index.html Step 1 Click on START_iNZightVIT.bat. Step 2 Click on
More informationUsing simulation to calculate the NPV of a project
Using simulation to calculate the NPV of a project Marius Holtan Onward Inc. 5/31/2002 Monte Carlo simulation is fast becoming the technology of choice for evaluating and analyzing assets, be it pure financial
More informationProject Planning, Scheduling and Control: Assignment 2 D. U. Singer Hospital Products Corp.
Project Planning, Scheduling and Control: Assignment 2 D. U. Singer Hospital Products Corp. Code for Course: MBL45-5 Assignment Number: 2 Student number: 75-163-3 Group Code Number: BOT1 Table of Contents
More informationVENDOR MANAGED INVENTORY
VENDOR MANAGED INVENTORY Martin Savelsbergh School of Industrial and Systems Engineering Georgia Institute of Technology Joint work with Ann Campbell, Anton Kleywegt, and Vijay Nori Distribution Systems:
More informationP2 Performance Management
Pillar P P2 Performance Management Instructions to candidates Specimen Examination Paper You are allowed three hours to answer this question paper. You are allowed 20 minutes reading time before the examination
More informationChapter 7 Production Planning
Production Planning and Control Chapter 7 Production Planning Professor JIANG Zhibin Dr GRANG Na Department of Industrial Engineering & Management Shanghai Jiao Tong University Contents Introduction Master
More informationChapter 12 Forecasting and Short- Term Financial Planning
Chapter 12 Forecasting and Short- Term Financial Planning LEARNING OBJECTIVES 1. Understand the sources and uses of cash in building a cash budget. 2. Explain how companies use sales forecasts to predict
More informationNatural Gas Wholesale Prices at PG&E Citygate as of November 7, 2006
QUARTERLY GAS ISSUES UPDATE December 26 I. Supply Issues Wholesale Natural Gas Prices Above normal temperatures and a lack of hurricane activity caused market prices to decrease in October. By November,
More informationSales Forecasting System for Chemicals Supplying Enterprises
Sales Forecasting System for Chemicals Supplying Enterprises Ma. Del Rocio Castillo E. 1, Ma. Magdalena Chain Palavicini 1, Roberto Del Rio Soto 1 & M. Javier Cruz Gómez 2 1 Facultad de Contaduría y Administración,
More information