Case Study-3 Module-3 Management at Jolly Arabia, leading food products producin

Question

Case Study-3 Module-3 Management at Jolly Arabia, leading food products producing and marketing company based in the Kingdom of Saudi Arabia has recently observed decline in their sales and market share in the highly competitive market. They hired Mr. Akram as a general manager to bring the company out of current crisis. Mr. Akram is a well renowned management expert with operations management education and experience. After studying, the role of OM and globalization, another problem Mr. Akram found was the forecasting system of the company as the management was not giving importance to it. So the next task he assigned to you was to prepare a proposal for the company suggesting the following; 1- Comparison between qualitative and quantitative forecasting approaches?

Explanation / Answer

Forecasting is the process of making predictions for the future through analysis and past and present data. I have done a detailed analysis on the effect of forecasting system on our company operations. Forecasting has great impact on the food industry and as we are not giving much importance to forecasting it has affected or sales to a great extent.

I have done studies on two types of forecasting methods which are quantitative forecasting and qualitative forecasting. The main difference between both the methods is that quantitative forecasting makes use of statistical tools to predict the future demand of the product and the qualitative methods make use of surveys, focus groups and expert opinions. Qualitative method is based of the people from whom the information is sought and the quantitative methods make use of the past sales data and various factors that may affect demand in future. Qualitative methods are most suitable for short term purposes and quantitative method of forecasting provide long term benefits.

As per my analysis we should focus on the quantitative methods of forecasting to identify the customer behavior and plan our future operations. The data for forecasting can be taken from our previous sales records and a detailed analysis on the data can be made possible. As we are trying to improve our business through methods that provide long term benefit, quantitative forecasting would be most suitable as per my opinion. Another disadvantage in qualitative method I can find is the dependency on customer opinion and the survey result can be wrong if the customer is not giving correct information. Quantitative forecasting would provide us reliable data and better forecasting.

In order to increase the sales and market share we can implement quantitative forecasting methods which will help us to identify the future demand for the product and plan our activities to increase sales and attract more customers.

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