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Forecasting and Capacity Planning: Operations Management Training Program

The document discusses qualitative and quantitative forecasting methods. Qualitative methods include expert opinion polls, the Delphi technique, and consumer surveys. These involve asking experts or consumers their opinions about future demand. Quantitative methods include time series techniques and causal models. Time series techniques use historical sales data to forecast future demand. Causal models mathematically relate variables like demand to factors like price using regression analysis. Both qualitative and quantitative methods have advantages and limitations for forecasting demand and capacity planning.

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Trace Hdez
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48 views

Forecasting and Capacity Planning: Operations Management Training Program

The document discusses qualitative and quantitative forecasting methods. Qualitative methods include expert opinion polls, the Delphi technique, and consumer surveys. These involve asking experts or consumers their opinions about future demand. Quantitative methods include time series techniques and causal models. Time series techniques use historical sales data to forecast future demand. Causal models mathematically relate variables like demand to factors like price using regression analysis. Both qualitative and quantitative methods have advantages and limitations for forecasting demand and capacity planning.

Uploaded by

Trace Hdez
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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FORECASTING AND CAPACITY PLANNING

Operations Management Training Program


QUALITATIVE AND
QUANTITATIVE METHODS
➤ qualitative methods
➤ expert opinion polls, Delphi technique,
and consumer surveys
➤ quantitative methods
➤ Time Series techniques and causal
models
QUALITATIVE AND
QUANTITATIVE METHODS
➤ expert opinion poll
➤ first identify individuals with relevant
experience
➤ solicit their opinions about what the
demand for the product will be
➤ experts predict the likely demand for a
given product
➤ a large number of experts and their
experience-based reactions vary
➤ the method can be highly subjective
QUALITATIVE AND
QUANTITATIVE METHODS
➤ Delphi technique
➤ a variant of the expert opinion poll
method
➤ arrive at a consensus in an uncertain area
by questioning a panel of experts
➤ repeatedly until their responses appear to
converge
➤ participants are given the opinions of
everyone on the panel of experts
➤ is intended to generate a reasoned opinion
QUALITATIVE AND
QUANTITATIVE METHODS
➤ consumer survey
➤ potential customers about their
purchasing plans and their projected
buying behavior
➤ demand forecasts are produced by
simply adding the probable demands
➤ the forecaster doesn't introduce any
bias or value judgment
➤ process is tedious, cumbersome, and
prone to error
QUALITATIVE AND
QUANTITATIVE METHODS
➤ Which statements are true of a
qualitative technique?
QUALITATIVE AND
QUANTITATIVE METHODS
➤ 1. Customers are asked about their
purchasing plans
➤ 2. Experts are asked their opinion about a
product
➤ 3. Historical data on previous sales is
collected to assess future demand
➤ 4. Analysis replaces opinion
QUALITATIVE AND
QUANTITATIVE METHODS
➤ 1. Customers are asked about their
purchasing plans
➤ 2. Experts are asked their opinion about a
product
➤ 3. Historical data on previous sales is
collected to assess future demand
➤ 4. Analysis replaces opinion
QUALITATIVE AND
QUANTITATIVE METHODS
➤ Time Series methods use historical data,
assuming that
➤ the causes of demand variation in the
future will be the same as in the past
➤ simplest Time Series technique for
forecasting demand is to assume that
future sales will equal past sales
➤ slightly more complicated version is to
use the simple average technique
➤ the most common forms of forecasting
QUALITATIVE AND
QUANTITATIVE METHODS
➤ based on the assumption that historical
patterns of demand are good indicators
➤ it doesn't require formal knowledge of
economic theory or of the market
➤ Time Series method is appropriate for
long-range forecasts
QUALITATIVE AND
QUANTITATIVE METHODS
➤ Causal models of forecasting
➤ assume that demand is strongly related to
a particular cause
➤ also a strong causal relationship between
price and demand
➤ use Time Series data, but with a
mathematical technique known as
regression analysis
➤ can mathematically relate dependent
variables like demand to independent
variables like time, price, or promotion
QUALITATIVE AND
QUANTITATIVE METHODS
➤ causal models take account of real-world
economic factors
➤ there are the time and cost implications
of collecting and analyzing data
➤ relationships between variables can
change over time
QUALITATIVE AND
QUANTITATIVE METHODS
➤ Match examples of techniques to the
forecasting model categories to which
they belong. Categories may have more
than one match.
QUALITATIVE AND
QUANTITATIVE METHODS
➤ A. Delphi ➤ 1. Qualitative
technique model
➤ B. Time Series ➤ 2. Quantitative
model
➤ C. Causal
models
➤ D. Consumer
survey
➤ E. Expert
opinion poll
QUALITATIVE AND
QUANTITATIVE METHODS
➤ A. Delphi ➤ 1. Qualitative
technique model
➤ B. Time Series ➤ 2. Quantitative
model
➤ C. Causal
models
➤ D. Consumer
survey
➤ E. Expert
opinion poll
QUALITATIVE AND
QUANTITATIVE METHODS
➤ Match specific forecasting techniques to
their descriptions.
QUALITATIVE AND
QUANTITATIVE METHODS
➤ A. Expert ➤ 1. Uses regression analysis to relate
dependent variables like demand to
opinion poll
independent variables like price
➤ B. Delphi ➤ 2. Assumes that historical patterns
technique of demand indicate future demand
➤ 3. Those with expertise related to a
➤ C. Consumer product are asked about likely
survey future demand

➤ D. Time ➤ 4. A panel of knowledgeable people


is questioned until a consensus
Series
emerges
➤ E. Causal ➤ 5. A relevant population is
model questioned about its future
purchasing plans
QUALITATIVE AND
QUANTITATIVE METHODS
➤ A. Expert ➤ 1. Uses regression analysis to relate
dependent variables like demand to
opinion poll
independent variables like price
➤ B. Delphi ➤ 2. Assumes that historical patterns
technique of demand indicate future demand
➤ 3. Those with expertise related to a
➤ C. Consumer product are asked about likely
survey future demand

➤ D. Time ➤ 4. A panel of knowledgeable people


is questioned until a consensus
Series
emerges
➤ E. Causal ➤ 5. A relevant population is
model questioned about its future
purchasing plans
FORECASTING AND CAPACITY PLANNING
Operations Management Training Program

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