Operational Forecasting

Question

Define the term Operational Forecasting and what are the forecasting methods?

Answer 1

Forecasting is the business planning process which covers predicting outcomes for the future business requirements when situation as are unknown and the period is fixed.

• supply & demand – seasonality
• inventory planning – ordering, holdings, storage, hedging
• resource planning – all aspects
• cash flow

Forecasting methods:

• econometric methods – mathematical equations
• rolling forecasts – past experience  
• judgmental – opinions, intuition, 
• simulation modeling