1. Forecasting Parminder Singh Grover

2. 08/12/2010 2 Forecasting Forecasting is the process of making statements about events whose actual outcomes have not yet been observed. Forecasting is an art of predicting future values of random variables.

3. Used to Ans. Imp Qus. How much profit will the business make? How much demand will there be for a product or service? How much money will the company need to borrow? When and how will borrowed funds be repaid? 08/12/2010 3

4. Need for forecasting It is necessary to predict the macro and micro changes as accurately as possible to survive and grow in a dynamic and uncertain world. 08/12/2010 4

5. Importance Forecasting prevents the company from spending time and money developing, manufacturing, and marketing a product that will fail. 08/12/2010 5

6. Methods of Forecasting QUALITATIVE FORECASTING Market research Product life-cycle Expert judgment 08/12/2010 6

7. Cont’d QUANTITATIVE FORECASTING TIME SERIES FORECASTING Trend Seasonal influence 08/12/2010 7

8. BENEFITS (Forecasting) Better material management Better labor relations Balanced work-load Minimization in the fluctuations of production 08/12/2010 8

9. Cont’d Better use of production facilities Better customer service Better utilization of capital and resources Better design of facilities and production system. 08/12/2010 9

10. Cost (Forecasting) Data always not reliable or accurate Data may be out of date The past is always not guide to future Wastage of time and money Lack of understanding 08/12/2010 10

11. Approaches Econometric : - Some forecasting methods use the assumption that it is possible to identify the underlying factors that might influence the variable that is being forecast. Time Series Analysis:- Time series methods use historical data as the basis of estimating future outcomes. 08/12/2010 11

12. Cont’d Subjective Judgmental :- Judgmental forecasting methods incorporate intuitive judgments, opinions & subjective probability estimates. 08/12/2010 12

13. Forecasting in Resort Identify Variable Do the data analysis Do paperwork Prepare forecaste Plan Make decision Implement Achieve desire result 08/12/2010 13

14. What do you think, Forecasting must for business ? 08/12/2010 14

15. Any Query ? 08/12/2010 15