This document discusses various forecasting techniques. It begins by outlining qualitative and quantitative forecasting approaches. Several quantitative time series models are then described in detail, including naive methods, moving averages, exponential smoothing, and regression techniques. Specific examples are provided to illustrate how to calculate forecasts using simple and weighted moving averages, exponential smoothing with different alpha values, and linear regression with correlation and coefficient of determination. The document provides an overview of key forecasting concepts and quantitative methods.
This document discusses various forecasting methods used in supply chain management including time series methods, regression methods, and qualitative forecasting. It describes key components of forecasting like time frame, demand behavior, and accuracy. Specific forecasting techniques covered include moving averages, exponential smoothing, trend lines, and seasonal adjustments. Accuracy is important for inventory levels, strategic planning, and quality management.
ForecastingBUS255 GoalsBy the end of this chapter, y.docxbudbarber38650
Forecasting
BUS255
Goals
By the end of this chapter, you should know:
Importance of Forecasting
Various Forecasting Techniques
Choosing a Forecasting Method
2
Forecasting
Forecasts are done to predict future events for planning
Finance, human resources, marketing, operations, and supply chain managers need forecasts to plan
Forecasts are made on many different variables
Forecasts are important to managing both processes and managing supply chains
3
Key Decisions in Forecasting
Deciding what to forecast
Level of aggregation
Units of measurement
Choosing a forecasting system
Choosing a forecasting technique
4
5
Forecasting Techniques
Qualitative (Judgment) Methods
Sales force Estimates
Time-series Methods
Naïve Method
Causal Methods
Executive Opinion
Market Research
Delphi Method
Moving Averages
Exponential Smoothing
Regression Analysis
Qualitative (Judgment) methods
Salesforce estimates
Executive opinion
Market Research
The Delphi Method
Salesforce estimates: Forecasts derived from estimates provided by salesforce.
Executive opinion: Method in which opinions, experience, and technical knowledge of one or more managers are summarized to arrive at a single forecast.
Market research: A scientific study and analysis of data gathered from consumer surveys intended to learn consumer interest in a product or service.
Delphi method: A process of gaining consensus from a group of experts while maintaining their anonymity.
6
Case Study
Reference: Krajewski, Ritzman, Malhotra. (2010). Operations Management: Processes and Supply Chains, Ninth Edition. Pearson Prentice Hall. P. 42-43.
7
Case study questions
What information system is used by UNILEVER to manage forecasts?
What does UNILEVER do when statistical information is not useful for forecasting?
What types of qualitative methods are used by UNILEVER?
What were some suggestions provided to improve forecasting?
8
Causal methods – Linear Regression
A dependent variable is related to one or more independent variables by a linear equation
The independent variables are assumed to “cause” the results observed in the past
Simple linear regression model assumes a straight line relationship
9
Causal methods – Linear Regression
Y = a + bX
where
Y = dependent variable
X = independent variable
a = Y-intercept of the line
b = slope of the line
10
Causal methods – Linear Regression
Fit of the regression model
Coefficient of determination
Standard error of the estimate
Please go to in-class exercise sheet
Coefficient of determination: Also called r-squared. Measures the amount of variation in the dependent variable about its mean that is explained by the regression line. Range between 0 and 1. In general, larger values are better.
Standard error of the estimate: Measures how closely the data on the dependent variable cluster around the regression line. Smaller values are better.
11
Time Series
A time seri.
This document provides an overview of demand forecasting methods. It discusses qualitative and quantitative forecasting models, including time series analysis techniques like moving averages, exponential smoothing, and adjusting for trends and seasonality. It also covers causal models using linear regression. Key steps in forecasting like selecting a model, measuring accuracy, and choosing software are outlined. The homework assigns practicing examples on least squares, moving averages, and exponential smoothing from a textbook.
This document discusses various methods for forecasting demand and sales, including quantitative and qualitative techniques. It provides an overview of key forecasting concepts such as time series analysis, moving averages, exponential smoothing, regression analysis, and evaluating forecast accuracy. The document compares different forecasting methods and provides examples of calculating forecasts using techniques like simple and weighted moving averages, exponential smoothing, and linear regression analysis.
This document provides an overview of time series forecasting methods. It discusses the strategic importance of accurate forecasting for supply chain management. Common time series methods are described, including moving averages, exponential smoothing, and linear trend lines. Moving averages take the average demand over a fixed number of past periods as the forecast. Exponential smoothing places more weight on recent data compared to older data. Linear trend lines identify trends in historical data and extrapolate those trends into the future. The document provides examples of how to calculate forecasts using these various time series methods.
This document provides an overview of time series forecasting methods. It discusses the strategic importance of accurate forecasting for supply chain management. Common time series methods are described, including moving averages, exponential smoothing, and linear trend lines. Moving averages take the average demand over a fixed number of periods. Exponential smoothing places more weight on recent data using a smoothing constant. Linear trend lines identify trends using a least squares approach to calculate the slope and intercept of a trend line. The document also covers seasonal adjustments to forecasts using seasonal factors.
The document summarizes key concepts about forecasting from the 8th edition of the textbook "Operations Management" by William J. Stevenson. It discusses definitions of forecasting, the importance and uses of forecasts in various business functions. Methods of forecasting include qualitative judgmental forecasts, quantitative time series analysis, and associative models using explanatory variables. Specific forecasting techniques covered include naive forecasts, moving averages, exponential smoothing, trend analysis, and regression. The document also addresses evaluating forecast accuracy and controlling forecasts.
This document provides an overview of quantitative forecasting methods. It discusses various forecasting techniques including moving averages, exponential smoothing, and judgmental forecasts. It also covers measuring forecast accuracy using metrics like mean absolute deviation, mean squared error, and mean absolute percentage error. Monitoring forecasts using tracking signals and setting upper and lower limits is recommended to ensure forecasts remain accurate over time.
This document discusses various forecasting methods used in supply chain management including time series methods, regression methods, and qualitative forecasting. It describes key components of forecasting like time frame, demand behavior, and accuracy. Specific forecasting techniques covered include moving averages, exponential smoothing, trend lines, and seasonal adjustments. Accuracy is important for inventory levels, strategic planning, and quality management.
ForecastingBUS255 GoalsBy the end of this chapter, y.docxbudbarber38650
Forecasting
BUS255
Goals
By the end of this chapter, you should know:
Importance of Forecasting
Various Forecasting Techniques
Choosing a Forecasting Method
2
Forecasting
Forecasts are done to predict future events for planning
Finance, human resources, marketing, operations, and supply chain managers need forecasts to plan
Forecasts are made on many different variables
Forecasts are important to managing both processes and managing supply chains
3
Key Decisions in Forecasting
Deciding what to forecast
Level of aggregation
Units of measurement
Choosing a forecasting system
Choosing a forecasting technique
4
5
Forecasting Techniques
Qualitative (Judgment) Methods
Sales force Estimates
Time-series Methods
Naïve Method
Causal Methods
Executive Opinion
Market Research
Delphi Method
Moving Averages
Exponential Smoothing
Regression Analysis
Qualitative (Judgment) methods
Salesforce estimates
Executive opinion
Market Research
The Delphi Method
Salesforce estimates: Forecasts derived from estimates provided by salesforce.
Executive opinion: Method in which opinions, experience, and technical knowledge of one or more managers are summarized to arrive at a single forecast.
Market research: A scientific study and analysis of data gathered from consumer surveys intended to learn consumer interest in a product or service.
Delphi method: A process of gaining consensus from a group of experts while maintaining their anonymity.
6
Case Study
Reference: Krajewski, Ritzman, Malhotra. (2010). Operations Management: Processes and Supply Chains, Ninth Edition. Pearson Prentice Hall. P. 42-43.
7
Case study questions
What information system is used by UNILEVER to manage forecasts?
What does UNILEVER do when statistical information is not useful for forecasting?
What types of qualitative methods are used by UNILEVER?
What were some suggestions provided to improve forecasting?
8
Causal methods – Linear Regression
A dependent variable is related to one or more independent variables by a linear equation
The independent variables are assumed to “cause” the results observed in the past
Simple linear regression model assumes a straight line relationship
9
Causal methods – Linear Regression
Y = a + bX
where
Y = dependent variable
X = independent variable
a = Y-intercept of the line
b = slope of the line
10
Causal methods – Linear Regression
Fit of the regression model
Coefficient of determination
Standard error of the estimate
Please go to in-class exercise sheet
Coefficient of determination: Also called r-squared. Measures the amount of variation in the dependent variable about its mean that is explained by the regression line. Range between 0 and 1. In general, larger values are better.
Standard error of the estimate: Measures how closely the data on the dependent variable cluster around the regression line. Smaller values are better.
11
Time Series
A time seri.
This document provides an overview of demand forecasting methods. It discusses qualitative and quantitative forecasting models, including time series analysis techniques like moving averages, exponential smoothing, and adjusting for trends and seasonality. It also covers causal models using linear regression. Key steps in forecasting like selecting a model, measuring accuracy, and choosing software are outlined. The homework assigns practicing examples on least squares, moving averages, and exponential smoothing from a textbook.
This document discusses various methods for forecasting demand and sales, including quantitative and qualitative techniques. It provides an overview of key forecasting concepts such as time series analysis, moving averages, exponential smoothing, regression analysis, and evaluating forecast accuracy. The document compares different forecasting methods and provides examples of calculating forecasts using techniques like simple and weighted moving averages, exponential smoothing, and linear regression analysis.
This document provides an overview of time series forecasting methods. It discusses the strategic importance of accurate forecasting for supply chain management. Common time series methods are described, including moving averages, exponential smoothing, and linear trend lines. Moving averages take the average demand over a fixed number of past periods as the forecast. Exponential smoothing places more weight on recent data compared to older data. Linear trend lines identify trends in historical data and extrapolate those trends into the future. The document provides examples of how to calculate forecasts using these various time series methods.
This document provides an overview of time series forecasting methods. It discusses the strategic importance of accurate forecasting for supply chain management. Common time series methods are described, including moving averages, exponential smoothing, and linear trend lines. Moving averages take the average demand over a fixed number of periods. Exponential smoothing places more weight on recent data using a smoothing constant. Linear trend lines identify trends using a least squares approach to calculate the slope and intercept of a trend line. The document also covers seasonal adjustments to forecasts using seasonal factors.
The document summarizes key concepts about forecasting from the 8th edition of the textbook "Operations Management" by William J. Stevenson. It discusses definitions of forecasting, the importance and uses of forecasts in various business functions. Methods of forecasting include qualitative judgmental forecasts, quantitative time series analysis, and associative models using explanatory variables. Specific forecasting techniques covered include naive forecasts, moving averages, exponential smoothing, trend analysis, and regression. The document also addresses evaluating forecast accuracy and controlling forecasts.
This document provides an overview of quantitative forecasting methods. It discusses various forecasting techniques including moving averages, exponential smoothing, and judgmental forecasts. It also covers measuring forecast accuracy using metrics like mean absolute deviation, mean squared error, and mean absolute percentage error. Monitoring forecasts using tracking signals and setting upper and lower limits is recommended to ensure forecasts remain accurate over time.
This document discusses various forecasting techniques. It covers qualitative and quantitative methods as well as different time horizons for forecasting. Specific quantitative techniques discussed include moving averages, exponential smoothing, regression analysis, and double exponential smoothing. Moving averages and exponential smoothing are described as methods for forecasting stationary time series. Exponential smoothing provides a weighted average of past observations with more weight given to recent observations. Double exponential smoothing accounts for trends by smoothing changes in the intercept and slope over time.
Demand forecasting plays a key role in supply chain planning and decision making. Accurate forecasts are needed for production scheduling, inventory management, marketing activities, financial planning, and workforce management. However, forecasts are never perfectly accurate and error should be measured. Different forecasting techniques exist, including qualitative methods that use expert opinions and quantitative methods like time series analysis and regression. The bullwhip effect occurs when demand variability increases at each step up the supply chain, exacerbating distortions in information flow and potentially disrupting operations.
1. Forecasting involves making structured plans for the future based on past and present data. It allows organizations to proactively plan for operations, costs, staffing needs, and more.
2. Common forecasting techniques include judgmental forecasts based on expert opinions, associative models that analyze relationships between variables, and time series analysis that assumes past patterns will continue.
3. Accuracy of forecasts typically decreases as the time horizon increases due to greater uncertainties further in the future. Forecasts are also generally more accurate for groups than individuals due to canceling effects among variations.
The document provides an overview of forecasting methods used in production and operations management. It discusses qualitative and quantitative forecasting approaches. Qualitative methods include manager opinion, surveys, and historical analogy, while quantitative methods analyze historical time series data using techniques like simple moving average, exponential smoothing, and regression. Accuracy of forecasts should be monitored over time using metrics like mean absolute deviation and mean squared error to assess forecasting model performance. The document emphasizes that demand forecasts are the starting point for all planning in production and operations management.
This document discusses forecasting techniques used in operations management. It defines a forecast as a statement about the future value of a variable of interest. Forecasts are used in accounting, finance, human resources, marketing, and other business functions. The document outlines judgmental, time series, and associative forecasting models. It describes techniques like naive forecasts, moving averages, exponential smoothing, linear trend analysis, and regression. Accuracy is evaluated using measures like MAD, MSE, and MAPE. Choosing a technique depends on cost, accuracy, data availability, time, and forecast horizon.
This document discusses forecasting methods in supply chain management. It covers time series forecasting techniques like moving averages, exponential smoothing, and linear trend lines. It also discusses qualitative forecasting methods and the components of an effective forecasting process. Accurate forecasting is important for supply chain management to determine inventory levels and reduce costs while ensuring customer needs are met. Time series and regression quantitative methods use historical data to predict future demand trends and patterns.
This document discusses several topics in industrial engineering including break-even analysis, forecasting, inventory, linear programming, transportation methods, project management, and queuing theory. It provides information on different forecasting techniques like regression analysis, time series analysis, moving averages, and exponential smoothing. It also covers inventory models for deterministic and uncertain demand, including the economic order quantity formula. Linear programming, transportation methods, and queuing theory are introduced.
This document discusses various quantitative forecasting methods including time series analysis, regression methods, and statistical control charts. Time series methods like moving averages and linear trend lines use historical demand data to predict future demand. Regression methods develop a mathematical relationship between demand and factors that influence it. Qualitative methods involve expert judgment. Statistical control charts can be used to monitor forecast accuracy over time.
This document discusses various techniques for mining time-series data, including regression analysis, trend analysis, and similarity search. Regression analysis can be used to model relationships between variables and make predictions. Trend analysis involves decomposing a time series into trend, seasonal, cyclic, and irregular components. Similarity search finds similar patterns or subsequences in time-series data and is useful for applications like financial analysis and scientific databases. Common techniques include data transformation, dimensionality reduction, and indexing to enable efficient similarity queries.
- Forecasting helps reduce risk and uncertainty in decision making by predicting future outcomes.
- There are three main types of forecasting methods: qualitative, extrapolative/time series, and causal/explanatory.
- Time series forecasting uses historical data patterns to predict future values, accounting for trends, seasonality, cycles, and randomness. Common time series forecasting techniques include moving averages, weighted moving averages, and exponential smoothing.
This document discusses various forecasting techniques used at Disney World for attendance forecasting. Disney generates daily, weekly, monthly, annual, and 5-year forecasts which are used for labor management, operations, and scheduling. Forecasting models take into account factors like economic conditions, airline prices, school schedules, and previous attendance data. Qualitative techniques like surveys and quantitative techniques like exponential smoothing and regression are used depending on the situation. Accuracy is important, so different forecasting constants and methods are evaluated based on error metrics.
This document discusses various forecasting techniques used at Disney World for attendance forecasting. Disney generates daily, weekly, monthly, annual, and 5-year forecasts which are used for labor management, operations, and scheduling. Forecasting models take into account factors like economic conditions, airline prices, school schedules, and previous attendance data. Qualitative methods include expert panels, while quantitative methods analyze historical data using techniques like moving averages, exponential smoothing, and regression analysis. Accuracy varies from 0-3% for annual forecasts to 5% for 5-year forecasts.
The document discusses various forecasting techniques including judgmental forecasts, time series forecasts, naive forecasts, moving averages, exponential smoothing, linear trends, and associative forecasts using simple linear regression. It describes the basic approaches and formulas for each technique and discusses factors to consider when choosing a forecasting method such as cost, accuracy, data availability, and forecast horizon.
This document discusses various quantitative forecasting techniques. It describes time series forecasting and the components of time series data including trend, seasonal, cyclical, and random variations. It then explains different forecasting methods such as the naive approach, moving averages, exponential smoothing, and least squares regression. It provides examples of how to calculate forecasts using these methods and compares their forecast errors using measures like mean absolute deviation, mean squared error, and mean absolute percent error to evaluate forecast accuracy.
The document summarizes various forecasting techniques used in industrial engineering and operations management. It discusses time series analysis, quantitative forecasting methods like moving average, weighted moving average, exponential smoothing and regression analysis. It also discusses qualitative forecasting techniques like market surveys and Delphi method. It provides examples of how to calculate forecasts using different quantitative techniques. Finally, it lists objective type questions related to forecasting from previous GATE and IES exams.
This document discusses various quantitative forecasting techniques including time series models. It provides an overview of moving averages, exponential smoothing, trend projections, and decomposition models. Examples are given to illustrate computing forecasts using a three-month simple moving average and a three-month weighted moving average. Exponential smoothing is also introduced as a type of moving average that requires less data to compute forecasts.
This document discusses forecasting methods. It defines forecasting as predicting future events and notes that forecasting underlies business decisions regarding production, inventory, personnel and facilities. It outlines different forecasting time horizons from short-range up to one year to long-range over three years. The document also discusses qualitative and quantitative forecasting approaches and provides examples of specific forecasting techniques like moving averages, exponential smoothing and error measurement methods.
This document discusses various qualitative and quantitative forecasting methods including simple and weighted moving averages, exponential smoothing, and simple linear regression. It provides examples of how to calculate forecasts using each of these methods and evaluates forecast accuracy using metrics like MAD and tracking signal.
Predictive modeling aims to generate accurate estimates of future outcomes by analyzing current and historical data using statistical and machine learning techniques. It involves gathering data, exploring the data, building predictive models using algorithms like regression, decision trees, and neural networks, and evaluating the models. Some common predictive modeling techniques include time series analysis, regression analysis, and clustering algorithms.
Global Situational Awareness of A.I. and where its headedvikram sood
You can see the future first in San Francisco.
Over the past year, the talk of the town has shifted from $10 billion compute clusters to $100 billion clusters to trillion-dollar clusters. Every six months another zero is added to the boardroom plans. Behind the scenes, there’s a fierce scramble to secure every power contract still available for the rest of the decade, every voltage transformer that can possibly be procured. American big business is gearing up to pour trillions of dollars into a long-unseen mobilization of American industrial might. By the end of the decade, American electricity production will have grown tens of percent; from the shale fields of Pennsylvania to the solar farms of Nevada, hundreds of millions of GPUs will hum.
The AGI race has begun. We are building machines that can think and reason. By 2025/26, these machines will outpace college graduates. By the end of the decade, they will be smarter than you or I; we will have superintelligence, in the true sense of the word. Along the way, national security forces not seen in half a century will be un-leashed, and before long, The Project will be on. If we’re lucky, we’ll be in an all-out race with the CCP; if we’re unlucky, an all-out war.
Everyone is now talking about AI, but few have the faintest glimmer of what is about to hit them. Nvidia analysts still think 2024 might be close to the peak. Mainstream pundits are stuck on the wilful blindness of “it’s just predicting the next word”. They see only hype and business-as-usual; at most they entertain another internet-scale technological change.
Before long, the world will wake up. But right now, there are perhaps a few hundred people, most of them in San Francisco and the AI labs, that have situational awareness. Through whatever peculiar forces of fate, I have found myself amongst them. A few years ago, these people were derided as crazy—but they trusted the trendlines, which allowed them to correctly predict the AI advances of the past few years. Whether these people are also right about the next few years remains to be seen. But these are very smart people—the smartest people I have ever met—and they are the ones building this technology. Perhaps they will be an odd footnote in history, or perhaps they will go down in history like Szilard and Oppenheimer and Teller. If they are seeing the future even close to correctly, we are in for a wild ride.
Let me tell you what we see.
The Building Blocks of QuestDB, a Time Series Databasejavier ramirez
Talk Delivered at Valencia Codes Meetup 2024-06.
Traditionally, databases have treated timestamps just as another data type. However, when performing real-time analytics, timestamps should be first class citizens and we need rich time semantics to get the most out of our data. We also need to deal with ever growing datasets while keeping performant, which is as fun as it sounds.
It is no wonder time-series databases are now more popular than ever before. Join me in this session to learn about the internal architecture and building blocks of QuestDB, an open source time-series database designed for speed. We will also review a history of some of the changes we have gone over the past two years to deal with late and unordered data, non-blocking writes, read-replicas, or faster batch ingestion.
This document discusses various forecasting techniques. It covers qualitative and quantitative methods as well as different time horizons for forecasting. Specific quantitative techniques discussed include moving averages, exponential smoothing, regression analysis, and double exponential smoothing. Moving averages and exponential smoothing are described as methods for forecasting stationary time series. Exponential smoothing provides a weighted average of past observations with more weight given to recent observations. Double exponential smoothing accounts for trends by smoothing changes in the intercept and slope over time.
Demand forecasting plays a key role in supply chain planning and decision making. Accurate forecasts are needed for production scheduling, inventory management, marketing activities, financial planning, and workforce management. However, forecasts are never perfectly accurate and error should be measured. Different forecasting techniques exist, including qualitative methods that use expert opinions and quantitative methods like time series analysis and regression. The bullwhip effect occurs when demand variability increases at each step up the supply chain, exacerbating distortions in information flow and potentially disrupting operations.
1. Forecasting involves making structured plans for the future based on past and present data. It allows organizations to proactively plan for operations, costs, staffing needs, and more.
2. Common forecasting techniques include judgmental forecasts based on expert opinions, associative models that analyze relationships between variables, and time series analysis that assumes past patterns will continue.
3. Accuracy of forecasts typically decreases as the time horizon increases due to greater uncertainties further in the future. Forecasts are also generally more accurate for groups than individuals due to canceling effects among variations.
The document provides an overview of forecasting methods used in production and operations management. It discusses qualitative and quantitative forecasting approaches. Qualitative methods include manager opinion, surveys, and historical analogy, while quantitative methods analyze historical time series data using techniques like simple moving average, exponential smoothing, and regression. Accuracy of forecasts should be monitored over time using metrics like mean absolute deviation and mean squared error to assess forecasting model performance. The document emphasizes that demand forecasts are the starting point for all planning in production and operations management.
This document discusses forecasting techniques used in operations management. It defines a forecast as a statement about the future value of a variable of interest. Forecasts are used in accounting, finance, human resources, marketing, and other business functions. The document outlines judgmental, time series, and associative forecasting models. It describes techniques like naive forecasts, moving averages, exponential smoothing, linear trend analysis, and regression. Accuracy is evaluated using measures like MAD, MSE, and MAPE. Choosing a technique depends on cost, accuracy, data availability, time, and forecast horizon.
This document discusses forecasting methods in supply chain management. It covers time series forecasting techniques like moving averages, exponential smoothing, and linear trend lines. It also discusses qualitative forecasting methods and the components of an effective forecasting process. Accurate forecasting is important for supply chain management to determine inventory levels and reduce costs while ensuring customer needs are met. Time series and regression quantitative methods use historical data to predict future demand trends and patterns.
This document discusses several topics in industrial engineering including break-even analysis, forecasting, inventory, linear programming, transportation methods, project management, and queuing theory. It provides information on different forecasting techniques like regression analysis, time series analysis, moving averages, and exponential smoothing. It also covers inventory models for deterministic and uncertain demand, including the economic order quantity formula. Linear programming, transportation methods, and queuing theory are introduced.
This document discusses various quantitative forecasting methods including time series analysis, regression methods, and statistical control charts. Time series methods like moving averages and linear trend lines use historical demand data to predict future demand. Regression methods develop a mathematical relationship between demand and factors that influence it. Qualitative methods involve expert judgment. Statistical control charts can be used to monitor forecast accuracy over time.
This document discusses various techniques for mining time-series data, including regression analysis, trend analysis, and similarity search. Regression analysis can be used to model relationships between variables and make predictions. Trend analysis involves decomposing a time series into trend, seasonal, cyclic, and irregular components. Similarity search finds similar patterns or subsequences in time-series data and is useful for applications like financial analysis and scientific databases. Common techniques include data transformation, dimensionality reduction, and indexing to enable efficient similarity queries.
- Forecasting helps reduce risk and uncertainty in decision making by predicting future outcomes.
- There are three main types of forecasting methods: qualitative, extrapolative/time series, and causal/explanatory.
- Time series forecasting uses historical data patterns to predict future values, accounting for trends, seasonality, cycles, and randomness. Common time series forecasting techniques include moving averages, weighted moving averages, and exponential smoothing.
This document discusses various forecasting techniques used at Disney World for attendance forecasting. Disney generates daily, weekly, monthly, annual, and 5-year forecasts which are used for labor management, operations, and scheduling. Forecasting models take into account factors like economic conditions, airline prices, school schedules, and previous attendance data. Qualitative techniques like surveys and quantitative techniques like exponential smoothing and regression are used depending on the situation. Accuracy is important, so different forecasting constants and methods are evaluated based on error metrics.
This document discusses various forecasting techniques used at Disney World for attendance forecasting. Disney generates daily, weekly, monthly, annual, and 5-year forecasts which are used for labor management, operations, and scheduling. Forecasting models take into account factors like economic conditions, airline prices, school schedules, and previous attendance data. Qualitative methods include expert panels, while quantitative methods analyze historical data using techniques like moving averages, exponential smoothing, and regression analysis. Accuracy varies from 0-3% for annual forecasts to 5% for 5-year forecasts.
The document discusses various forecasting techniques including judgmental forecasts, time series forecasts, naive forecasts, moving averages, exponential smoothing, linear trends, and associative forecasts using simple linear regression. It describes the basic approaches and formulas for each technique and discusses factors to consider when choosing a forecasting method such as cost, accuracy, data availability, and forecast horizon.
This document discusses various quantitative forecasting techniques. It describes time series forecasting and the components of time series data including trend, seasonal, cyclical, and random variations. It then explains different forecasting methods such as the naive approach, moving averages, exponential smoothing, and least squares regression. It provides examples of how to calculate forecasts using these methods and compares their forecast errors using measures like mean absolute deviation, mean squared error, and mean absolute percent error to evaluate forecast accuracy.
The document summarizes various forecasting techniques used in industrial engineering and operations management. It discusses time series analysis, quantitative forecasting methods like moving average, weighted moving average, exponential smoothing and regression analysis. It also discusses qualitative forecasting techniques like market surveys and Delphi method. It provides examples of how to calculate forecasts using different quantitative techniques. Finally, it lists objective type questions related to forecasting from previous GATE and IES exams.
This document discusses various quantitative forecasting techniques including time series models. It provides an overview of moving averages, exponential smoothing, trend projections, and decomposition models. Examples are given to illustrate computing forecasts using a three-month simple moving average and a three-month weighted moving average. Exponential smoothing is also introduced as a type of moving average that requires less data to compute forecasts.
This document discusses forecasting methods. It defines forecasting as predicting future events and notes that forecasting underlies business decisions regarding production, inventory, personnel and facilities. It outlines different forecasting time horizons from short-range up to one year to long-range over three years. The document also discusses qualitative and quantitative forecasting approaches and provides examples of specific forecasting techniques like moving averages, exponential smoothing and error measurement methods.
This document discusses various qualitative and quantitative forecasting methods including simple and weighted moving averages, exponential smoothing, and simple linear regression. It provides examples of how to calculate forecasts using each of these methods and evaluates forecast accuracy using metrics like MAD and tracking signal.
Predictive modeling aims to generate accurate estimates of future outcomes by analyzing current and historical data using statistical and machine learning techniques. It involves gathering data, exploring the data, building predictive models using algorithms like regression, decision trees, and neural networks, and evaluating the models. Some common predictive modeling techniques include time series analysis, regression analysis, and clustering algorithms.
Global Situational Awareness of A.I. and where its headedvikram sood
You can see the future first in San Francisco.
Over the past year, the talk of the town has shifted from $10 billion compute clusters to $100 billion clusters to trillion-dollar clusters. Every six months another zero is added to the boardroom plans. Behind the scenes, there’s a fierce scramble to secure every power contract still available for the rest of the decade, every voltage transformer that can possibly be procured. American big business is gearing up to pour trillions of dollars into a long-unseen mobilization of American industrial might. By the end of the decade, American electricity production will have grown tens of percent; from the shale fields of Pennsylvania to the solar farms of Nevada, hundreds of millions of GPUs will hum.
The AGI race has begun. We are building machines that can think and reason. By 2025/26, these machines will outpace college graduates. By the end of the decade, they will be smarter than you or I; we will have superintelligence, in the true sense of the word. Along the way, national security forces not seen in half a century will be un-leashed, and before long, The Project will be on. If we’re lucky, we’ll be in an all-out race with the CCP; if we’re unlucky, an all-out war.
Everyone is now talking about AI, but few have the faintest glimmer of what is about to hit them. Nvidia analysts still think 2024 might be close to the peak. Mainstream pundits are stuck on the wilful blindness of “it’s just predicting the next word”. They see only hype and business-as-usual; at most they entertain another internet-scale technological change.
Before long, the world will wake up. But right now, there are perhaps a few hundred people, most of them in San Francisco and the AI labs, that have situational awareness. Through whatever peculiar forces of fate, I have found myself amongst them. A few years ago, these people were derided as crazy—but they trusted the trendlines, which allowed them to correctly predict the AI advances of the past few years. Whether these people are also right about the next few years remains to be seen. But these are very smart people—the smartest people I have ever met—and they are the ones building this technology. Perhaps they will be an odd footnote in history, or perhaps they will go down in history like Szilard and Oppenheimer and Teller. If they are seeing the future even close to correctly, we are in for a wild ride.
Let me tell you what we see.
The Building Blocks of QuestDB, a Time Series Databasejavier ramirez
Talk Delivered at Valencia Codes Meetup 2024-06.
Traditionally, databases have treated timestamps just as another data type. However, when performing real-time analytics, timestamps should be first class citizens and we need rich time semantics to get the most out of our data. We also need to deal with ever growing datasets while keeping performant, which is as fun as it sounds.
It is no wonder time-series databases are now more popular than ever before. Join me in this session to learn about the internal architecture and building blocks of QuestDB, an open source time-series database designed for speed. We will also review a history of some of the changes we have gone over the past two years to deal with late and unordered data, non-blocking writes, read-replicas, or faster batch ingestion.
4th Modern Marketing Reckoner by MMA Global India & Group M: 60+ experts on W...Social Samosa
The Modern Marketing Reckoner (MMR) is a comprehensive resource packed with POVs from 60+ industry leaders on how AI is transforming the 4 key pillars of marketing – product, place, price and promotions.
Predictably Improve Your B2B Tech Company's Performance by Leveraging DataKiwi Creative
Harness the power of AI-backed reports, benchmarking and data analysis to predict trends and detect anomalies in your marketing efforts.
Peter Caputa, CEO at Databox, reveals how you can discover the strategies and tools to increase your growth rate (and margins!).
From metrics to track to data habits to pick up, enhance your reporting for powerful insights to improve your B2B tech company's marketing.
- - -
This is the webinar recording from the June 2024 HubSpot User Group (HUG) for B2B Technology USA.
Watch the video recording at https://youtu.be/5vjwGfPN9lw
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2. 2
Road Map
Role of Forecasting
Forecasting Approaches
Qualitative forecasting
Quantitative forecasting
Time Series Models
Regression Methods
Forecast Accuracy
Focus Forecasting
3. 3
Forecasting
Predicting the Future
Vital for business
organization
Underlying basis of
all business decisions
Most techniques assume an
underlying stability in the
system
Qualitative Forecasting Approach:
Quantitative Forecasting
Approach:
17. 17
Qualitative Methods
Grass root method – going down to the lowest level of hierarchy
Market research – data collection and hypothesis testing
Jury of ‘executive opinion’ – source of internal qualitative forecast
Historical analogy – history or past data of the item
Panel consensus – free open exchange in between select few
Delphi Method - Iterative group process
3 types of participants
Decision makers: Evaluate responses and make decisions
Staff: Administering survey
Respondents: People who can make valuable judgments
18. 18
Quantitative Forecasting
Time Series Models:
Set of evenly spaced numerical data - Obtained by observing
response variable at regular time periods
Forecast based only on past values - Assumes that factors
influencing past and present will continue influence in future
1. Naive approach
2. Moving averages
3. Exponential smoothing
4. Trend projection
Associative Models / Causal Models:
1. Linear regression
19. 19
Demand Behavior
Trend
Persistent, overall upward or downward pattern
Changes due to population, technology, age, culture, etc.
Cycle
an up-&-down repetitive movement in demand over a length of span
due to business cycle; political and economic factors
Seasonal pattern
is often weather / festival / event / specific period related
oscillating in nature - usually occurs within a single year
Random variations
Erratic; unsystematic; short duration non-repeating
unpredictable and have no “assignable causes”
20. 20
Time
(a) Trend
Time
(d) Trend with seasonal pattern
Time
(c) Seasonal pattern
Time
(b) Cycle
Demand
Demand
Demand
Demand
Random
movement
Forms of Forecast Movement
21. Demand
for
product
or
service
| | | |
1 2 3 4
Year
Average demand
over four years
Seasonal peaks
Trend component
Actual
demand
Random
variation
Components of Demand
22. 22
Moving Average
Naive Forecast / Intuitive Forecast
Demand of the current period is used as next period’s forecast
Does not take into account historical behavior
Reacts directly to the normal, random movements of the demand
Cost effective and sometimes very efficient
Simple Moving Average
Uses several demand values during the recent past to forecast
Tends to ‘smoothen’ or ‘dampen’, the random variations in single period
forecast
Preferable for stable demand with no pronounced behavioral patterns
Computed for specific number of periods depending on how the forecaster
desires to ‘smoothen’ the demand data
The longer the moving average period, the smoother it will be.
Alternatively, a shorter is more susceptible to simple random variations
23. 23
Naïve Approach
Jan 120
Feb 90
Mar 100
Apr 75
May 110
June 50
July 75
Aug 130
Sept 110
Oct 90
ORDERS
MONTH PER MONTH
-
120
90
100
75
110
50
75
130
110
90
Nov -
FORECAST
24. 24
Simple Moving Average
MAn =
n
i = 1
Di
n
where
n = number of periods in
the moving average
Di = demand in period i
25. 25
3 Month Simple Moving Average
Jan 120
Feb 90
Mar 100
Apr 75
May 110
June 50
July 75
Aug 130
Sept 110
Oct 90
Nov -
ORDERS
MONTH PER MONTH
MA3 =
3
i = 1
Di
3
=
120 + 90 + 100
3
= 103.3 orders for Apr.
–
–
–
103.3
88.3
95.0
78.3
78.3
85.0
105.0
110.0
MOVING
AVERAGE
26. 26
5 Month Simple Moving Average
Jan 120
Feb 90
Mar 100
Apr 75
May 110
June 50
July 75
Aug 130
Sept 110
Oct 90
Nov -
ORDERS
MONTH PER MONTH
MA5 =
5
i = 1
Di
5
=
90 + 110 + 130+75+50
5
= 91 orders for Nov.
–
–
–
–
–
99.0
85.0
82.0
88.0
95.0
91.0
MOVING
AVERAGE
27. 27
Smoothing Effects
150 –
125 –
100 –
75 –
50 –
25 –
0 – | | | | | | | | | | |
Jan Feb Mar Apr May June July Aug Sept Oct Nov
Actual
Orders
Month
5-month
3-month
28. 28
Weighted Moving Average
Adjusts moving average method to more closely reflect
data fluctuations
Weights are assigned to most recent data, barring in case of
seasonal cycles
Precise weights are decided thorough trial and error (based
on experience and intuition), as does the number of periods to
be considered
If recent periods are weighted too heavily, the forecast might
over-react to a random fluctuation in demand
If they are weighted too lightly, the forecast might under-react
to actual changes in demand pattern
30. 30
Weighted Moving Average
MONTH WEIGHT DATA
August 17% 130
September 33% 110
October 50% 90
WMA3 =
3
i = 1
Wi Di
= (0.50) (90) + (0.33) (110) + (0.17) (130)
= 103.4 orders
November Forecast
31. 31
Averaging method - weights most recent data more
strongly
As the past becomes more distant, the imp. of data
diminishes
So very useful and preferable method, if recent changes
are significant and unpredictable
Widely used, most popular because its an accurate
method
Requires minimal data:
forecast for the current period,
actual demand for the current period and
a weighing factor OR smoothing constant.
Exponential Smoothing
32. 32
Ft+1 = *Dt + (1 - ) * Ft
where:
Ft + 1 =forecast for next period
Dt = actual demand for present period
Ft = previously determined forecast for present
period
= weighting factor, smoothing constant –
determines the level of smoothing
*Assume first forecast as Actual Demand…
Exponential Smoothing
33. 33
Effect of Smoothing Constant
0.0 1.0
reflects the weight given to the most recent demand data
If = 0.20, then Ft + 1 = 0.20 * Dt + 0.8 * Ft
If = 0, then Ft + 1 = Ft
Forecast does not even consider recent actual data
If = 1, then Ft + 1 = 1 * Dt + 0 * Ft = Dt
Forecast based only on most recent data, so this becomes
as good as naïve forecast
34. 34
F2 = D1 + (1- ) F1
= (0.30) 37 + (1- 0.3) 37
= 37
F3 = D2 + (1- ) F2
= (0.30) 40 + (1- 0.3) 37
= 37.90
F13 = D12 + (1- ) F12
= (0.30) 54 + (1- 0.3) 50.84
= 51.79
Exponential Smoothing (α = 0.30)
PERIOD MONTH DEMAND
1 Jan 37
2 Feb 40
3 Mar 41
4 Apr 37
5 May 45
6 Jun 50
7 Jul 43
8 Aug 47
9 Sep 56
10 Oct 52
11 Nov 55
12 Dec 54
35. 35
FORECAST, Ft + 1
PERIOD MONTH DEMAND ( = 0.3) ( = 0.5)
1 Jan 37 – –
2 Feb 40 37.00 37.00
3 Mar 41 37.90 38.50
4 Apr 37 38.83 39.75
5 May 45 38.28 38.37
6 Jun 50 40.29 41.68
7 Jul 43 43.20 45.84
8 Aug 47 43.14 44.42
9 Sep 56 44.30 45.71
10 Oct 52 47.81 50.85
11 Nov 55 49.06 51.42
12 Dec 54 50.84 53.21
13 Jan – 51.79 53.61
Exponential Smoothing
37. 37
Regression Methods
Linear Regression
Regression can be defined as functional relationship between
two or more correlated variables
Regression is used for forecasting by establishing a
mathematical relationship between two or more variables
(demand and some other independent variable) in the form of
a linear equation
It is used to predict one variable given the other
Linear regression refers to the special class of regression
where the relationship between the variable forms a straight
line
Good for long range forecasting and aggregate planning
38. 38
Linear Regression is a causal
method of forecasting in which a
mathematical relationship is
developed between demand and
time.
Linear trend line relates a
dependent variable (demand) to
an independent variable (time) in
the form of a linear equation:
y = a + bx
a = intercept
b = slope of the line
x = time period
y = demand forecast for period x
Linear Trend Line
b =
a = y - b x
where
n = number of periods
x = = mean of the x values
y = = mean of the y values
xy - nxy
x2 - nx2
x
n
y
n
43. 43
Linear Regression Example (cont.)
x = = 6.125
y = = 43.36
b =
=
= 4.06
a = y - bx
= 43.36 - (4.06)(6.125)
= 18.46
49
8
346.9
8
xy - nxy
x2 - nx2
(2,167.7) - (8)(6.125)(43.36)
(311) - (8)(6.125)2
44. 44
| | | | | | | | | | |
0 1 2 3 4 5 6 7 8 9 10
60,000 –
50,000 –
40,000 –
30,000 –
20,000 –
10,000 –
Linear regression line,
y = 18.46 + 4.06x
Wins, x
Attendance,
y
Linear Regression Example (cont.)
y = 18.46 + 4.06x y = 18.46 + 4.06(7)
= 46.88, or 46,880
Regression equation Sales forecast for 7 lakhs of ad spend
45. 45
Correlation & Coefficient of Determination
Correlation, r
Correlation is a measure of the strength of the relationship
between independent and dependent variables
degree of association between two variables (-1.00 to +1.00)
nil/poor/average/strong, & positive/negative
Coefficient of Determination, r2
Percentage of variation in dependent variable resulting from
changes in the independent variable (0% to 100%)
A measure of the amount of variation in the dependent variable
about its mean that is explained by the regression equation
46. 46
Computing Correlation
n xy - x y
[n x2 - ( x)2] [n y2 - ( y)2]
r =
Coefficient of Determination
r2 = (0.947)2 = 0.897
r =
(8)(2,167.7) - (49)(346.9)
[(8)(311) - (49)2] [(8)(15,224.7) - (346.9)2]
r = 0.947
47. 47
Forecast Accuracy
A forecast is never ever accurate
Large degree of error mean
Either the forecasting technique used is applied wrongly or is
not applicable in the case
Wrong relationship among variables
Or the ‘parameters’ used need to be adjusted for ‘trend’
Forecast Error
Difference between forecast and actual demand - Error
MAD - Mean Absolute Deviation
MAPD - Mean Absolute Percent Deviation or MAPE
Cumulative Error - RSFE
Average Error or Bias
48. 48
Mean Absolute Deviation (MAD)
MAD: The absolute average difference between the AD &
FD.
where,
t = period number
Dt = demand in period t
Ft = forecast for period t
n = total number of periods
= absolute value
The smaller the value of MAD relative to the magnitude of
Dt - Ft
n
M A D =
49. 49
Other Accuracy Measures
MAPD: Measures the absolute error (AV-FV) as a % of
demand rather than per period (MAD). Can be used
across the board to measure the relative accuracy of the
forecast.
Cumulative Error (RSFE): Simply computed by
summing up the forecast errors. That’s why Linear Trend
Line has zero cumulative value.
Average Error (Bias): Computed by averaging the
cumulative error value (RSFE) over the number of time
periods. +ve value: low, -ve value: high and zero value: no
bias
50. 50
Other Accuracy Measures
Mean Absolute Percent Deviation (MAPD)
MAPD =
|Dt - Ft|
Dt
Cumulative Error (RSFE)
RSFE = et = (Dt – Ft)
Average Error (Bias)
E =
et
n
52. 52
Forecast Control
Forecast can go out of control due to various reasons
Change in trend
Unanticipated appearance of a cycle
Irregular variation such as unseasonable weather
Promotional campaign, new competition, political reasons,
others…
Tracking Signal: this indicates whether the forecast average is
keeping pace with any genuine upward or downward changes in
demand
Monitors the forecast to see if it is biased high or low
Tracking Signal = =
(Dt - Ft)
MAD
RSFE
MAD
58. 58
Seasonal Adjustments
Repetitive increase / decrease in demand
Seasonal patterns can also occur on a periodic basis
Use seasonal factor to adjust forecast
A seasonal factor is a numeric value that is multiplied
by the normal forecast to get a seasonally adjusted
forecast
A seasonal factor range from 0 to 1, it is in effect, the
portion of annual demand assigned to each season
Thus SF when multiplied to annual forecasted demand
yield seasonally adjusted forecasts for each season
Seasonal Factor =
Si =
Di
D
59. 59
Seasonal Adjustment (cont.)
2002 12.6 8.6 6.3 17.5 45.0
2003 14.1 10.3 7.5 18.2 50.1
2004 15.3 10.6 8.1 19.6 53.6
Total 42.0 29.5 21.9 55.3 148.7
DEMAND (1000’S PER QUARTER)
YEAR I II III IV Total
SI = = = 0.28
D1
D
42.0
148.7
SII = = = 0.20
D2
D
29.5
148.7
SIV = = = 0.37
D4
D
55.3
148.7
SIII = = = 0.15
D3
D
21.9
148.7
60. Seasonal Adjustment (cont.)
X Y X*X X*Y
1 45.0 1 45.00
2 50.1 4 100.20
3 53.6 9 160.80
FIND MEAN OF X AND Y
VALUE OF a AND b
60
62. 62
Forecasting Process
6. Check forecast
accuracy with one
or more measures
4. Select a forecast
model that seems
appropriate for data
5. Develop/compute
forecast for period
of historical data
8a. Forecast over
planning horizon
9. Adjust forecast
based on additional
qualitative info’ & insight
10. Monitor results
and measure
forecast accuracy
8b. Select new
forecast model or
adjust parameters
of existing model
7.
Is accuracy
of forecast
acceptable?
1. Identify the
purpose of forecast
3. Plot data and
identify patterns
2. Collect historical
data
No
Yes