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Below are four basic principles of forecasting:
1. Forecasts are rarely perfect
2. Short-term forecasts are usually better than long term forecasts
3. Aggregate forecasts (group) are usually more accurate that disaggregate (individual item) forecasts
4. The further up a supply chain a company is (farther from the end customer), the greater the distortion of information.
Briefly explain what is meant by each principle. How does understanding these principles help improve forecasting?
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A number of drivers of change have transformed the roles, functions and responsibilities of an operations manager over recent years. These drivers have not only been based on technological innovations but also on the need for organisations to develop..
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