Manager judgmental forecasts performing satisfactorily

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Reference no: EM131232655

Two experienced managers at Wilson Boat, Inc. are resisting the introduction of a computerized exponential smoothing system, claiming that their judgmental forecasts are much better than any computer could do. Their past record of predictions is as follows:

Week Actual Demand           Manager’s Forecast

1                      4,000                           4,500

2                      4,200                           5,000

3                      4,200                           4,000

4                      3,000                           3,800

5                      3,800                           3,600

6                      5,000                           4,000

7                      5,600                           5,000

8                      4,400                           4,800

9                      5,000                           4,000

10                    4,800                           5,000

a. How would the manager’s forecast compare to a single exponential smoothing forecast using a = 0.4?

b. Based on whatever calculations you think appropriate, are the manager’s judgmental forecasts performing satisfactorily?

c. What other criteria should be used to select a forecasting method for this company?

Reference no: EM131232655

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