Where Should the Forecasting Function Reside?

WHERE SHOULD THE FORECASTING FUNCTION RESIDE? By Larry Lapide, VP and GM, Supply Strategies, AMR Research (This is an ongoing column in The Journal, which is intended to give a brief view on a potential topic of interest to practitioners of business forecasting. Suggestions on topics that you would like to see covered should be sent via email to llapide@amrresearch.com. Ed) The Fall 2002 Journal of Business Forecasting publication was a special issue on benchmarking. The publication covered a variety of benchmark data collected by the Institute of Business Forecasting (IBF) in a survey it conducted. One of the most interesting data sets I noticed dealt with results on where respondents stated their company’s forecasting function resides. The results showed that across all industries polled the percent of companies where the forecasting function resides by department was: • Operations/Production: 20% • Marketing: 20% • Finance: 14% • Sales: 12% • Forecasting: 10% • Logistics: 9% • Strategic Planning: 6% • Other: 9% While the data is certainly interesting, it is not insightful in helping a company determine where it should put its forecasting function. Essentially ...