Management Consulting: Marketing manage ment, financial accumulation, sales estimates

About Us

Browse Answers:

Tell Friends

11-08-2015

How to Ask

How to Volunteer

By Category

Alphabetically

Jobs/Careers

Managem ent Consulting

FAQ

Tech Support

Top Experts

Expert Login

Management
Consulting
All Answ ers
Answ ers by Expert:
Leo Lingham
Mark Eichinger
Ask Experts
Volunteer

Leo Lingham
Expertise
management consulting
process, management
consulting career,
management development,
human resource planning and
development, strategic
planning in human resources,
marketing, careers in
management, product
management etc

Experience
18 years working managerial
experience covering business
planning, strategic planning,
corporate planning,
management service,
organization development,
marketing, sales
management etc
PLUS
24 years in management
consulting which includes
business planning, strategic
planning, marketing , product
management,
human resource
management, management
training, business coaching,
counseling etc
Organizations
PRINC IPAL -- BESTBUSIC ON
Pty Ltd
Education/Credentials
MASTERS IN SC IENC E
MASTERS IN BUSINESS
ADMINSTRATION

You are here: Hom e

Managem ent Consulting

Mark eting m anage m ent

Management Consulting/Marketing manage ment

Expert: Leo Lingham - 4/6/2013
Advertisem ent

Question
DEAR SIR
Kindly send me answ er of this question on urgent please
CASE STUDY : 1
Traditional Forecasting
Many organizations seek to mitigate some of the traditional budgeting problems noted above by
implementing some form of forecasting. This allow s managers to update budgeted numbers w ith actual
results for the periods that have already occurred. The forecasts are used to predict w hat w ill happen in
the future, often seeking to confirm w hether predetermined annual targets w ill still be met.
W hile financial managers think of forecasting in terms of periodic forecasts, operating managers are
constantly adjusting plans, including sales estimates, w hich are converted to operating plans for
production and inventory control levels. Most of these planning efforts are conducted in numerous
discrete systems supporting different functional areas. A great deal of effort is required to integrate and
reconcile these different view s of the future.
Financial forecasts are performed on a preset schedule, typically quarterly or monthly.
According to David Axson, author of "Best Practices in Planning and Management Reporting" 4. Axson
explains that these process cycle times are extended due to:
The difficulty in getting timely information;
The high level of details required taking significant time to forecast each item; and
The fact that much of this data is developed in a series of disconnected spreadsheets making
integration a time-consuming process.
Many companies use a purely financial process that is disconnected from its specific business drivers-a
mere financial accumulation of trends. These companies often determine their monthly forecasts by
subtracting the actual results to date from their annual targets and then dividing the remaining gap by the
months remaining. They then view the monthly result to see if it is even possible to attain, All their
forecasting w ork focuses on achieving the predefined annual targets, even if the underlying assumptions
that w ent into creating those targets are now Incorrect.
The level of detail used often mirrors the annual plan. Some planners forecast at the same level of detail
that is used for actual reporting, This can result in tremendous efforts in calculating variances and the
related explanation process.
These misconceptions often turn traditional forecasting into merely a different pc version of the
problems w ith traditional budgeting. Let's examine w hy.
For many organizations, forecasting is a mechanical process that adjusts future run rates upw ard or
dow nw ard as necessary so that the predetermined annual targets are still met.
They ignore the fact that targets w ere set based on various assumptions. W hat happens w hen the annual
targets are held but their underlying basis proves incorrect? The great quality guru W . Edw ards Deming
noted that "if you pay people to hit targets, they often w ill, even if it destroys your company.
Answer
3. Expect the Unexpected.David Axson
4. Forecasting a critical business process in turbulent times.
5. W hat is a forecast? Forw ard Looking Fact-based Flexible Focused on Risks & Opportunities
6. The end result ... is not an accurate picture of tomorrow , but better decisions about the future.Peter
Schw artz, The Art of the Long View
7. Good forecasting practices create value Career Perform n ance Reputatio
8. The traditional approach... J F M A M J J A S O N D
9. The traditional template
10. Static forecasts do not provide the necessary visibility in turbulent times.
11. It show s...
12. Rolling Forecasts. An effective approach. 2009 IBM Corporation
13. W hat is a Rolling forecast J F M A M J J A S O N D J F M A M J Q1 Forecast Traditional Q2 forecast Q3 Q1
Forecast Rolling forecast
14. W hy are rolling forecasts attractive? Increased visibility Consistent time horizon Less reliance on budget
Solid baseline for new plans
15. Rolling Forecasts speed up the budgeting process Source: The Hackett Group, 2008
16. Not only time is saved. Satisfaction increases. Source: The Hackett Group, 2008
17. Some elements of a successful forecast Time Horizon & Process Update Frequency Management Agile
Models
18. Time Horizon & Process Update Frequency Management Agile Models

http://en.allexperts.com/q/Management-Consulting-2802/2013/4/marketing-manage-ment-1.htm

1/2

Management Consulting: Marketing manage ment, financial accumulation, sales estimates

11-08-2015

19. Rolling Forecast = 12 month quartely? No. It depends on your business!

20. Match the time horizon to the rhythm of your business Short cycles Long cycles Industry Consumer
electronics Oil exploration Retailing Pharma development Investment banking Infrastructure investment Plant
construction Function Advertising Cash flow Infrastructure investment Overtime Research & development
21. Best practice companies move tow ards more frequent & event-driven updates.
22. Time Horizon & Process Update Frequency Management Agile Models
23. Remember this template?
24. Simplicity is the ultimate sophistication.Leonardo da Vinci
25. Less is more! Simplify your models
26. Utilize drivers the language of business Opportunities Pipeline Number of employees VS. Customer
Satisfaction 634172 Revenue (New Accts) 665891 Office Supplies (Paper) 665892 Office Supplies (Pens)
677199 Gifts, Misc.
27. Revenue?
28. Time Horizon & Process Update Frequency Management Agile Models
29. Process management is critical W ow ...there are a lot of moving parts! W e need to make a critical decision
quickly!
30. SAP HR DW Update Distribute Aggregate W hat-if & Models Models data Optimize New Load Collect Report
& version Actuals Data Analyze
31. Management Decision Meetings Making!
32. Critical elements of the process Aim for repeatability Measure the quality Set strict goals
33. And measure & monitor your process Forecast Accuracy Cycle Time Confidence Levels
34. Summary: Some elements of a successful forecast Time Horizon & Process Update Frequency Management
Agile Models
35. Demo goes here
36. Rolling Forecasts a silver bullet? No one-size-fits-all approach Agile models & process required
Technology as enabler Forecast culture required
37. Next Steps Analyze your processes Dow nload our w hite papers & blueprints Join the Cognos Innovation
Center W eb: w w w .ibm.com/cognos/innovation-center Tw itter: @ibmcognosicemea
38. Session Summary The current business environment requires solid forecasting practices that the traditional
approaches do not provide Rolling forecasts provide a proven approach for gaining better business insight in
todays volatile business climate IBM provides best practices and solutions for implementing a better forecasting
approach
1. first as David mentioned you need exactly to define your problem: how to take the standard time per 1 sample.
In our case if you have more samples you can obtain a standard time per group and divide it # of samples in that
respective group (doesn't matter if you don't have a constant number of samples).
2. In order to obtain that standard time you need to:
a. break into small tasks the main activity;
b. take the time w ith a stopw atch of each small task (this is called observed time)
c. the stopw atch time obtained has some variation due to w orker experience (beginner - medium - advanced) &
frequency of the small task (how many times this small task w as repeated inside the main activity) and you need
to take into consideration like this: Observed time * w orker experience rating * frequency = Normal time (this is
called)
d. ILO (International Labor Organization) has put some allow ances in every type of industry for personal
needs/fatigue etc. and you need to take it into consideration like this: Observed time * w orker experience rating
* frequency * ILO allow ences = Standard Time = Cycle Time.
e. This Cycle Time that you obtained should be the same of each sample you are producing, and w ould be
changed only if you modify the process (meaning eliminate/add small tasks inside the main activity)
W hat I've mentioned above are the main principles in getting that Cycle Time, but the topic is much more complex
cause at a certain point in your process you can have that so called Normal Time - fixed or variable (if the same
main activity may contain one or more variable small tasks).

Add to this Answer

Ask a Question

User Agreement Privacy Policy

2015 About.com. All rights reserved.

http://en.allexperts.com/q/Management-Consulting-2802/2013/4/marketing-manage-ment-1.htm

2/2