Melting The Frozen Forecast

MELTING THE FROZEN FORECAST By Stephen R. Riehm A fictional account of a real crisis, this article recounts the human drama of a forecast process decision and how one company arrived at a compromise. The events have been embellished to illustrate a common forecasting challenge, communication between different business groups. Whose side are you on? The question came from one of my Logistics brethren. For eight years I was one of them. Now I was presiding over a meeting and hinting that I might actually be taking the side of Sales. 'I'm not taking a side," I explained. The setting was a forecast process design meeting during the implementation of a new system. The objective was to decide whether to "freeze" the forecast for a certain number of periods and prevent further changes. For instance, the deadline for adjusting next month’s forecast might be the second Friday of this month. After that, everyone was locked out from making changes. Representatives from Sales, Finance, and Logistics had gathered to protect their interests. ‘Given that the new system will allow us to choose whether or not to freeze the forecast, and if so when, I just want everyone to understand ...