Question

Q3. How accurate is your local five-day weather forecast? Support your answer with actual data.

Q6. How is forecasting in the context of a supply chain different from forecasting for just a single organization? Lists possible supply chain benefits and discuss potential difficulties in doing supply chain forecasting.

Q7. Which type of forecasting approach, qualitative or quantitative, is better?

Answer 1

A typical supply chain is made of a number of participants such as retailers, distributors, suppliers, vendors and so on and they all work in a combination so that the finished product can be provided to the customer If we see closely, then it is clear that as a number of layers are involved in the supply chain, thus any kind of limitations or poor forecast of supply chain can be managed by other layers in the supply chain, but when we talk about the small organization having a limited number of plays involved, any mistake in the forecasting can be proved very significant for the entire organization.

Advantages:- The forecasting in the supply chain has the advantage of having accurate inventory management, and customer satisfaction can be obtained by providing the products to the customers in the desired quantities. This will also lead to a stronger partnership with the members of the supply chain, having the equilibrium in the supply and demand, having effective operations in the organization.

Limitations:- Demand variability is the biggest challenge which is faced in the supply chain forecasting. This becomes more of the issue particularly when the forecasting of the newly launched product has to be done as there is no past data available.

Answer:- Quantitative methods of forecasting are better than the qualitative forecasting as in the case of quantitative forecasting, the prediction is done on the basis of past data and thus it provides more accurate predictions. These methods do not encounter a lot of variation.