1-1 logistics management lsm 730 dr. khurrum s. mughal lecture 20
TRANSCRIPT
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1-1
Logistics ManagementLSM 730
Dr. Khurrum S. Mughal
Lecture 20
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8-2
Forecasting Supply Chain Requirements
CR (2004) Prentice Hall, Inc.
I hope you'll keep in mind that economic forecasting is far from a perfect science. If recent history's any guide, the experts have some explaining to do about what they told us had to happen but never did.
Ronald Reagan, 1984
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8-3
Forecasting in Inventory Strategy
CR (2004) Prentice Hall, Inc.
PL
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Transport Strategy• Transport fundamentals• Transport decisions
Customer service goals
• The product• Logistics service• Ord. proc. & info. sys.
Inventory Strategy• Forecasting• Inventory decisions• Purchasing and supply
scheduling decisions• Storage fundamentals• Storage decisions
Location Strategy• Location decisions• The network planning process
PL
AN
NIN
G
OR
GA
NIZ
ING
CO
NT
RO
LL
ING
Transport Strategy• Transport fundamentals• Transport decisions
Customer service goals
• The product• Logistics service• Ord. proc. & info. sys.
Inventory Strategy• Forecasting• Inventory decisions• Purchasing and supply
scheduling decisions• Storage fundamentals• Storage decisions
Location Strategy• Location decisions• The network planning process
![Page 4: 1-1 Logistics Management LSM 730 Dr. Khurrum S. Mughal Lecture 20](https://reader035.vdocuments.net/reader035/viewer/2022062519/5697bff31a28abf838cbcb45/html5/thumbnails/4.jpg)
8-4
What’s Forecasted in the Supply Chain?
•Demand, sales or requirements
•Purchase prices
•Replenishment and delivery times
CR (2004) Prentice Hall, Inc.
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Supply Chain Management• Accurate forecasting determines inventory
levels in the supply chain• Continuous replenishment
– supplier & customer share continuously updated data
– typically managed by the supplier– reduces inventory for the company– speeds customer delivery
• Variations of continuous replenishment– quick response– JIT (just-in-time)– VMI (vendor-managed inventory)– stockless inventory 12-5
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Copyright 2011 John Wiley & Sons, Inc.
The Effect of Inaccurate Forecasting
12-6
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Copyright 2011 John Wiley & Sons, Inc.
Types of Forecasting Methods• Depend on
– time frame– demand behavior– causes of behavior
12-7
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Copyright 2011 John Wiley & Sons, Inc.
Time Frame
• Indicates how far into the future is forecast– Short- to mid-range forecast
• typically encompasses the immediate future• daily up to two years
– Long-range forecast• usually encompasses a period of time longer than two
years
12-8
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8-9
What’s Forecasted in the Supply Chain?
•Spatial Vs Temporal Demand
•Lumpy Vs Regular Demand
•Derived Vs. Independent Demand
CR (2004) Prentice Hall, Inc.
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8-10CR (2004) Prentice Hall, Inc.
Some Forecasting Method Choices
• QualitativeSurveysExpert systems or rule-based
• Historical projectionExponential smoothing
• Causal or associativeRegression analysis
• Collaborative