forecast

Deliverable Length: 500–750 words plus a chart/time line (1 document)

The forecasting department, traditionally reporting to the sale manager, has historically seen a forecast accuracy of about 60%, and this in turn causes problems for the following departments:

•Purchasing: What should we buy and how much?

•Production: What should we really build?

•Inventory management: We keep building the wrong thing.

The sales manager asked you to write her a memo, specifically addressing the following:

•How could you suggest that your new system would achieve any better levels of forecast accuracy?

•Why is forecast accuracy itself not as important under traditional methods?

•Create a chart or timeline that includes all of the following: ◦Which purchase orders have to be placed, and when?

◦When manufacturing needs to begin, to have products delivered to a customer

◦Approximate dates for all of the following:-

◾When the product must be shipped to meet the customer’s due date

◾When the application of the cover and packaging must take place to meet the customer’s due date

◾When the manufacturing of the widget must begin and end

◾When the raw material for the widget must be ordered

◾When the plastic cover must be ordered

◾When the cardboard box must be ordered

◦Includes notes explain your timing calculation

◦Assumes all of the following conditions:-

◾The factory has two departments: manufacturing and packaging

◾Product X consists of 3 components

◾a widget manufactured in the factory with a total manufacturing lead time of 1 week

◾a plastic cover purchased from vendor A with a procurement lead time of 3 weeks

◾a cardboard shipping box purchased from vendor B with a procurement lead time of 4 weeks

◾The widget itself is made from steel (whose lead time from vendor C is 4 weeks).

◾It takes 1 day for the cover to be applied to the product and for the product to be inserted in the box in the packaging department.

◾The shipping time to this customer is in 3 weeks, and you do not want it to be late or early.

◾Assume you received the customer order on 1/1/20XX.

◾Ignore any holidays

◾Assume a 5-day work week

◾The customer requires the product to arrive at his location on 12/31/2014

 

 

 

 

 

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