Forecasting/Production Planning

OK now the next chapter in Introduction Industrial Engineering subject . this time we will learn Forecasting .

why we learn forecasting ? because if we want success in Industrial , we must have plan for next period  . in planning we determining an accurate forecasting base on the historical data , so how if we just have little data ? thats why we learn forecasting . ok start !

Classification
method in forecasting divine in to two method . first quantitative method , it is use when historical data is avaliable . two quanlitative method , it is use when no historical data avaliable so experts influence .

Range

• short range : more accurate, less than 1 year
• medium range : 1 to 5 years
• long range : more than 5 years

The method

1. Naive
2. Moving Average

• simple moving average
• weighted moving average
• moving average with trend

      3. Exponential Smoothing

• Simple Exponential Smoothing
• Double Exponential Smoothing

And for decide which one is better , we can use Validation formula , there is the formula

1. MAE(Mean Absolute Error) 
2. MSE(Mean Square Error)

for detail of every method , validation and example , see in other post :-)