Reference no: EM132229223

“Suppose that you work for a company that produces breakfast cereals, such as corn flakes. Your employer is planning to introduce a completely new product for the company -- a hot breakfast product made from ingredients that require some minimal consumer preparation. How would you propose forecasting the initial demand.”

Forecasting has three general types. There is qualitative, which may rely on expert judgement or available information about special events that may or may not take past events into consideration. Time series analysis and projection that focuses on patterns and changes to the established patterns based on historical data. And Causal models which uses processed and specific information between system elements, that can involve special events, and is rooted in historical trends.

If I was responsible for forecasting for a company that produced breakfast cereals and wanted to launch a new product, I would look at this as a special event with no prior data to rely on. This leaves only a quantitative forecasting methodology. It is the only forecasting method that doesn’t rely solely on historical data. Delphi and Expert Opinion can offer information to how we use data to see what this product’s chances are. Delphi can be used as a blind study with a focus group that hasn’t met with other members to see if this product is worth the price and effort. Experts that have worked through product launches can offer details for how to expect this product can perform. I would look to similar product launches and couple that with current brand recognition and sales. If this company was underperforming in our current competitive markets, I would weight the projections with biased against the launch. If we were doing well, I would weight the current status as a positive for the likelihood of a successful product launch.