Chapter 4: Problem 2

What is the expert opinion method of forecasting demand?

Short Answer

Expert verified

Question: Explain the expert opinion method of forecasting demand and provide an overview of the process. Answer: The expert opinion method of forecasting demand is an approach that uses the insights and knowledge of industry experts to predict future demand for products or services. This method combines qualitative and quantitative techniques and is particularly useful when there is limited historical data, or in rapidly evolving or uncertain markets. The process involves six steps: 1. Identify experts with extensive knowledge and experience in the product or service domain. 2. Prepare relevant questions to gather critical data, such as market trends, customer preferences, and changes in the competitive landscape. 3. Conduct interviews or surveys with the selected experts using a structured approach. 4. Analyze the data collected, using statistical techniques or qualitative analysis methods, to identify patterns, trends, and other common factors. 5. Generate a demand forecast for the product or service, incorporating qualitative information from the expert insights. 6. Continuously review and refine the demand forecast as new information becomes available or market conditions change, by maintaining ongoing dialogue with the experts.

Step by step solution

Introduction

The expert opinion method of forecasting demand is an approach that uses the knowledge and insights of industry experts to predict future demand for products or services. It combines qualitative and quantitative techniques to generate forecasts and can be particularly useful when there is limited historical data, or when the market is rapidly evolving or uncertain.

Identify Experts

To make use of the expert opinion method, you first need to identify industry experts who have extensive knowledge and experience in your product or service domain. These experts could be senior executives, market analysts, consultants, or other professionals who have demonstrated expertise in your industry.

Prepare Relevant Questions

Once you have identified the experts, prepare a set of relevant questions that target the critical factors affecting your product's or service's demand. Be specific about the data you need from the experts, including aspects such as market trends, customer preferences, and potential changes in the competitive landscape.

Conduct Interviews or Surveys

Reach out to the selected experts and conduct interviews or surveys to gather their opinions and insights regarding your research questions. Use a structured approach, so the responses are easy to compare and analyze. Ensure that the experts understand that their answers will be used to forecast demand and inform strategic decisions.

Analyze the Data

After obtaining the expert opinions and insights, the next step is to analyze the data you collected. You can use statistical techniques or qualitative analysis methods to process the information obtained from the experts. Look for patterns, trends, and other factors that are common among the expert opinions to form the basis of your demand forecast.

Generate Demand Forecast

Once you have analyzed the expert opinions, consolidate the findings and develop a demand forecast for your product or service. Use the expert insights to devise scenarios or make adjustments to existing forecasts based on quantitative data. By incorporating the qualitative information from the experts, you can create a more comprehensive and accurate forecast.

Review and Refine

Continuously review and update the expert opinion method as new information becomes available or market conditions change. Make sure to maintain an ongoing dialogue with your experts and conduct regular updates to ensure the accuracy and relevancy of your demand forecast. In conclusion, the expert opinion method of forecasting demand is a valuable approach, especially when dealing with limited historical data or situations with high uncertainty. By following these steps, you can tap into the knowledge and insights of industry experts and use their expertise to develop more accurate and robust demand forecasts.

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