Worst Practices in Forecasting

Jan. 11, 2008
Sometimes the pursuit of "best in class" is a losing proposition.

The most fundamental worst practice, says Mike Gilliland, product marketing manager at SAS Institute, is to assume things work without bothering to measure them. "This can occur when purported 'best practices' are implemented without solid evidence that they are even a 'good' practice." Speaking at the recent APICS Conference in Denver, Gilliland listed some of the other most prevalent worst practices:

  • having unrealistic accuracy expectations
  • setting inappropriate performance targets
  • employing overly elaborate systems or processes
  • using inappropriate statistical models due to over-fitting to history, or "pick best" selection software
  • not utilizing a naive forecast
  • political tampering with statistical forecasts
  • blaming the forecast for all business woes.
Questioning the conventional wisdom, Gilliland asks, "How good do you really have to be at forecasting?" For many companies, he observes, achieving "best in class" forecasting could very well be a waste of resources if the company's major challenges lie in other areas. "By eliminating the worst practices in their forecasting efforts," he explains, "companies should be able to forecast as accurately as can reasonably be expected and achieve this as efficiently as possible."

See Also

Popular Sponsored Recommendations

Global Supply Chain Readiness Report: The Pandemic and Beyond

Sept. 23, 2022
Jabil and IndustryWeek look into how manufacturers are responding to supply chain woes.

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

How Manufacturers Can Optimize Operations with Weather Intelligence

Nov. 2, 2023
The bad news? Severe weather has emerged as one of the biggest threats to continuity and safety in manufacturing. The good news? The intelligence solutions that build weather ...

How Organizations Connect and Engage with Frontline Workers

June 14, 2023
Nearly 80% of the 2.7 billion workers across manufacturing, construction, healthcare, transportation, agriculture, hospitality, and education are frontline. Learn best practices...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!