Reference no: EM133379953

Forecasting Case Study: Boone Factory Forecasting Model

Boone Factory is a new, modernized factory in the heart of the Midwest that has been producing widgets for the past two years. There has been success because the widgets have been skillfully manufactured and demand has been good. Management and employees are proud of their production facility geared towards "lean" operations along with the high-quality widgets which are "benchmarked" by other widget manufacturers.

Management, led by the CEO, Mr. James Boone, is very concerned because demand has been very dynamic with highs and lows that they want to gauge better in order to reduce inventory, better match demand, and have the appropriate production workers at the factory. Management, along with all the employees, are very much aware of the hallmarks of operations management through training and brainstorming sessions to build streamlined processes and innovation.

Forecasting has been used to some extent by management including the "naïve" method, along with qualitative methods including consumer surveys, and executive/salesforce opinions. Management would like to review the historical widget demand and produce a Moving Average Demand Forecast given demand in the last three periods for the year.

Explain in detail the differences between qualitative and quantitative forecasts. Include at least two examples of when each would be utilized.

Reflect upon the exercise you completed for the Moving Average Forecast and the key points that you have learned. Compare and contrast to determine if you feel a weighted Moving Average or an Exponential forecast would be more appropriate/precise in the Boone Factory scenario. Explain your selection.

Explain the what the benefits and drawbacks are of forecasting. Also describe when a mixture of forecasting models be appropriate.