Question
#1
Oak Hollow Medical Evaluation Center CASE 14.1 Oak Hollow Medical Evaluation Center is a nonprofit agency offering multidisciplinary diagnostic services to study children with disabilities or developmental delays. The center can test each patient for physical, psychological, or social problems. Fees for services are based on an ability-to-pay schedule. requirements, and operating expenses as part of his effort to attract funding. To this end, the director has approached an operations management professor at the local university for assistance in preparing a patient, staffing, and budget forecast for the coming year. The professor has asked you to aid her in The evaluation center exists in a highly competitive envi- this project. Tables 14.8 through 14.11 give you some perti- ronment. Many public-spirited organizations are competing nent information. for shrinking funds, and many groups such as private physi- cians, private and school psychologists, and social service Assignments organizations also are "competing" for the same patients. As a 1 Given the information available and your knowledge of dif- result of this situation, the center finds itself in an increasing vulnerable financial position. ferent forecasting techniques, recommend a specific fore- casting technique for this study. Consider the advantages Mr. Abel, the director ened with the center's ability to attract adequate what additional information, if any, Mr. Abel would need and serve community needs. Mr. Abel now must 2, Develop forecasts for patient, staffing, and budget levels for accurate estimate of the future patient load, staffingn next year
Explanation / Answer
1- After carefully analysing the case of the hospital, I will suggest for time series method of forecasting. There are different techniques of forecasting under time series method but for this particular situation I will suggest exponential smoothing. Exponential smoothing takes into consideration the past demand and historical numbers and provide weight to them according to relevance. In healthcare sector uncertainty is much more and it is provided in this case also. Double exponential smoothing can be better help the manager to forecast future numbers because it takes into account the possibility of a series exhibiting some form of trend. It provides more accurate forecast and it gives more significance to recent observations. Disadvantage of this technique is that it produces forecast which lag behind the actual trend because lag is a side effect of the smoothing process.The other disadvantage is that it cannot handle the trend well. To do exponential smoothing the forecasted value of past number needed.
