How can process improvement improve sales forecast accuracy?
People in manufacturing plants often struggle with problems created by poor accuracy in the sales forecast. Often they struggle in vain to find a magic algorithm that will provide a few percentage points of improvement. However, the sales forecast accuracy problem can’t be solved with the data available in the plant. Shipments are forecast based on what is happening where the product is made – within the plant. Proper sales forecasting should be based on what is happening where the sales are made – in the field. Statistical extrapolation of past sales numbers looks for patterns in the historical numbers. But what if competition has changed in the market? What if an inexperienced new salesperson or distributor is involved? What if a previous coupon promotion is no longer in place? What if the customer switched to a new approach and needs a different kind of product? These are the things that will drive future behavior of customers, and they are not things you can possibly be aware of wi
