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A study to examine the importance of forecast accuracy to supply chain performance: A case study at a company from the FMCG industry

Avci, Ö (2019) A study to examine the importance of forecast accuracy to supply chain performance: A case study at a company from the FMCG industry.

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Abstract:Nowadays, managing global food supply chains is becoming ever more challenging and the increasing complexity in food supply chains calls for awareness in supply chain forecasting. Since forecasting is the starting point of all supply chain activities, its degree of accuracy plays a critical role in supply chain management. The purpose of this study is to examine the importance of forecast accuracy to supply chain performance. By collecting qualitative and quantitative data, a small case study has been conducted at a firm which is active in the FMCG sector. This study indicates that several determining factors influence the accuracy of the forecasts. By analysing three KPIs with significant mismatches between the forecast and actual values, it became clear that the forecast accuracy mainly is influenced by production related factors, information related factors, the human factor and technology & tools. The literature review aligns with these findings, however, the case study shows that organisational culture, new product development and supplier delivery performance must be considered as new determining factors, since their influence is significantly noticeable. Additionally, the literature review and case study have shown that forecasting and planning are both related with each other as well as the importance of forecasting in the decision-making process. It has been restricted in its time and scope, leading to an analysis on only three KPIs. It is advisable to study other KPIs, where significant mismatches between the forecast and actual values occur, with the same depth in order to fully understand the impact of forecast accuracy on supply chain performance.
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:58 process technology, 85 business administration, organizational science
Programme:International Business Administration BSc (50952)
Keywords:Advisory, Decision-making, Determining factors, Forecast accuracy, FMCG industry, Performance tracking, Planning, Supply chain management
Link to this item:http://purl.utwente.nl/essays/78622
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