In this week’s What-if Wednesday post, Arkieva Supply Chain Optimization Consultant – Abhishek Shah – shares the results of a what-if demand forecast simulation using the gamma multiplicative forecast parameter of the Winters forecasting method.
In the previous What-if Wednesday previous posts, we experimented with the three parameters of Holt-Winters method, namely; alpha, beta, and gamma. This week we are going to run some tests with the damping factor.
Sales and Operations Planning (S&OP) is typically a monthly process. Through a series of detailed planning steps, and usually three meetings, companies define a plan to deal with what they think they can do to meet the demand given their supply and other constraints.
What-if scenario planning is an excellent technique that allows a planner to ask questions on the future. Given a working model that represents a business, a planner can quickly ask the questions that represent the range of possibilities in the foreseeable future which can render the current plan obsolete.
Recently, I was visiting with a prospect in Pennsylvania and they lamented on the effect of the ongoing port shutdowns on the west coast. He went on to say how they have heard of a threat for a shutdown for many years and everyone had become accustomed to it.