Planning and Controlling Supply Chain

Planning and Controlling the Supply Chain

Companies benefit from the use of supply chains to fulfill high customer demands through controlled inventory and labor, efficient use of resources and distribution capabilities. This paper differentiates forecasting techniques, analyzes various plans relating to budgets and compares and contrasts the material requirements planning (MRP) system.

Companies use forecasting methods to help determine future trends in their business. These methods are qualitative, time series analysis, causal relationships and simulation. Qualitative forecasting is based on estimates and opinions. Market research and panel consensus are two forms of qualitative forecasting that Kudler Fine Foods (KFF) uses. Market research is used to forecast long-range and new product sales by collecting data from surveys or interviews. KFF uses surveys to collect data on customer satisfaction. Panel consensus is the idea that having open discussion at meetings will produce better forecasts.

Time series analysis is based on the idea that past sales can help predict future sales. Shiskin time series and trend projections are two forms of time series analysis. Shiskin time series is an effective way to forecast by breaking down time into seasonal, trends and irregular. KFF department managers use historical data from the last two to three years to help in forecasting sales. Trend projections are predictions made in the purchasing of certain products during special events or new fads. Trend projections “fit a mathematical trend line to the data points and projects it into the future” (Chase, Jacobs, & Aquilano, 2006).

Causal relationships uses forecasting methods based on sales that are affected by advertising, quality, and competitors. Regression analysis and input/output models are two forms of causal forecasting used by KFF. Regression analysis uses the basis that forecasting is caused by the occurrence of other events. KFF stays abreast of current...