Forecasting Has a Global Reach Throughout a Company
Forecasting must be a collaborative effort. Getting buy-in and input from other departments of the company should be the first step in the Forecasting Process. It is helpful not only to the Planning Team, but almost all other areas of the Company will realize benefits as well from accurate Forecasting.
- Corporate Performance – Management needs to be on board with the Forecasting Process. Operational performance improvements, like increased turn, enhanced profits and inventory reduction are results of good Forecasting. These improvements lead to improved cashflow across the company.
- Distribution – Improved receipt flow can result in personnel efficiencies. Identification of top performing products can lead to improved logistical productivity.
- Accounting – Forecasting gives Management vital information for financial discussions. Management can use this information to strategize the direction the company should take based on current trends and inventory levels.
- Production – Planning and Production must work very closely to ensure that there is enough capacity to produce the items needed. Production can be prioritized and workforce scheduled based on good Forecasts.
- Sales – Planning must work with the Sales Force to gain insight into what the Customers are demanding and what is happening in the Marketplace. Sales can be assured that production is meeting these Customer demands when Planning and Sales work together. In addition, Planning can alert the Sales Force to emerging trends they are seeing, giving them a jump on the competition.
- Human Resources – A good forecast will enable Human Resources to plan their staffing according to the production needs of the company, resulting in savings in labor costs.
Accurate Forecasting truly does have a global reach throughout a company. Its benefits are far-reaching, but must start with collaboration across departments.