TRINIDAD MUNICIPAL COLLEGE

Poblacion, Trinidad, Bohol

VISION : A model institution with fully developed technical vocational education and skills
of manpower with positive work attitudes anchored in the core values of Professionalism
and Leadership essential in the creation of self – reliant citizens.

MISSION: To build well – trained professionals, competent and employable that will meet
the demands in the world market.

College of Office Administration

Subject Code : TQM

Module 4
CHAPTER 4.1
CLASSIFICATION OF EXPONENTIAL
- Smoothing models
- Linear or additive trend model
- Ration seasonality model
- Additive trend and ratio seasonality model
- Initialization
- Adaptive methods
CAUSAL OR EXPLANATORY METHODS
- Regression analysis
- Econometric methods

METHODS OF FORECASTING
Method General Description Application
Time Series Forecasting Models
Moving averages Forecasting based on Short range forecast for
projection from time series operations such as
data smoothed by a moving inventory, schedules,
average, taking account of control, pricing, and timing
trends and seasonal special promotions.
variations.
Requires at least two years
of historic data.
Exponential moving Similar to moving average Short range forecast for
average but the averages are operations such as
weighted exponentially to inventory, schedules,
give more recent more data control, pricing, and timing
heavier weight. Well special promotions.
adapted to computer
application and large
numbers of items to be
forecast.
Requires at least two years
of historical data.
Decomposition Each component of the time Medium range forecast and
series is extrapolated forecast of aggregate data,
separately and the results air traffic, business activity,
are then combined to etc.
produce a forecast.
Box- Jenkins Models a time series by a Short and medium range
combination of moving forecast of sales.
 averages and
autocorrelation terms
Fourier series least squares Fits a finite Fourier series Short and medium range
fit equation to empirical data, forecast of sales.
projecting trend and
seasonal values.
Requires at least two years
of historical data.
Causal Forecasting Methods
Regression analysis Forecast of demand related Short and medium range
to economic and competitive forecasting of existing
actors that control or cause products and services;
demand, through the least marketing strategies,
squares regression production and facility
equation. planning.
Econometric models Based on system of Short and medium range
interdependent regression forecasting of existing
equations. products and services;
marketing strategies,
production and facility
planning.
Predictive Methods
Delphi Expert panel answers a Long range predictions; new
series of questionnaire products and product
where the answers to each development, market
questionnaire and are strategies, pricing and
summarized and made facility planning.
available to the panel to aid
in answering next
questionnaire.
Marketing surveys Testing markets through Long range predictions; new
questionnaires, panels, products and product
surveys, test of trial development, market
products, and analysis of strategies, pricing and
time data. facility planning.
Historical analogy and life Prediction based on analysis Long range predictions; new
cycle analysis and comparison with the products and product
growth and development of development, market
similar products. strategies, pricing and
Forecasting new product facility planning.
growth based on the S-
curve of introduction, growth
and market saturation.
Scenario based forecasting Uses expert judgment in Long range predictions; new
predicting alternative future products and product
scenarios. development, market
strategies, pricing and
facility planning.