Academic journal article The Journal of Business Forecasting

Letter from the Editor

Academic journal article The Journal of Business Forecasting

Letter from the Editor

Article excerpt

Over the last three decades, market dynamics have significantly changed and so have the business processes. The market is now driven by demand - not supply. Gone are the days when manufacturers produced what they thought they could sell. If something was left over, marketing made it go away. If there was a shortage of something, consumers would wait. Now consumers have neither the patience nor the loyalty. If you don't have what they want and at the price they want, someone else will. All this has resulted from the increasing competition fueled by the proliferation of products and channels of distribution, the shorter product life cycles, and the increasing globalization. To meet this challenge both suppliers and retailers responded by taking their forecasting process to a next level.

What was needed was the ability to predict more accurately and quickly the changes in the marketplace, develop good actionable plans, and then execute them without delay. To achieve this, the forecasting process evolved from Silo Forecasting to Consensus Forecasting to Sales and Operations Planning (S&OP) and now to Collaborative Planning, Forecasting and Replenishment (CPFR). Forecasts could not improve in a silo set-up because each function prepared them just for its own use, and thus were not accountable. As such, the input of other functions was neither solicited nor incorporated into forecasts. This led to the development of Consensus Forecasting, where one function prepared statistical forecasts, and then presented them at monthly consensus meetings attended by all the functions. At the meeting, they collectively reviewed the forecasts and, where necessary, overlaid judgment on them. This improved the forecasts, but the functions did not have the authority to act on them. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.