Monday, November 26, 2007

A New Direction, Talking About Strategies

Today I'd like to talk a little about "The Game". In general, I'm referring to the Eagles v. Patriots game last night and the direction the Eagles will choose to take their franchise. More specifically, I'd like you to think about this debate metaphorically, about to address how a person or team might attack a decision. Do you have any decisions where it may be time for you to consider a new direction?

The Eagles have a problem. After several seasons of repeated injuries and inability to close the deal during playoffs and the Super Bowl, the Eagles now have the opportunity to choose whether to keep Donavan McNabb as starting QB or change to the AJ Feeley. Donavan had to leave the game early last week due to an injury and was unable to play yesterday. AJ stepped in to fill his shoes and defeated the Dolphins, and came away with a near-win against the Pats last night.

The team has two paths that it can choose. The Eagles can choose to go down the known path with McNabb, who has proven repeatedly that he is injury prone and can't get the team through the Super Bowl. He does have an amazing arm and may yet spring to life like the Donovan of old. AJ has done amazing things in the past (2002) and as long as he isn't passing the ball to Asante Samuel, he looks great.

What strategy should the Eagles take? Is it time to try a new Quarterback or to stay with the old one. A new Quarterback would change the entire direction of the Eagles franchise.So, do you choose the known path that has some potential for success, or do you choose the unknown path with greater potential for success?

It's time for the Eagles to decide.

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Thursday, November 8, 2007

Up or Down?

I just wanted to throw my two cents out there regarding today's market. I think the recent drop in the market will likely continue today and into next week. The general public is starting to wake up to the falling dollar and rising gas prices, and this Christmas they don't have home equity loans to fall back on. Traders are recognizing how this may affect sales for some businesses in the next quarter. The market may pop up here and there, but the next week may be ugly.

Okay, sorry this entry is so short, but this has been one crazy week for me between the job interviews and the classwork.
-----Sincerely, Trevor Stasik.

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Monday, November 5, 2007

Forecasting Series Summary

Over the last several weeks, we have looked at forecasting from a variety of angles. We have looked at why it's important, how it is calculated, and how to determine it's accuracy. Topics we have looked at include:

All of these are important areas to look at. I hope that this series looking into forecasting has been informative, especially in regards to sales and demand. I may return to the subject of forecasting in the future once I have more knowledge and experience. Thank you for taking this journey with me. The business world can be stormy. However, a handy and accurate forecast can help financial analysts and project managers predict trouble in advance, and help businesses steer into safer harbors.

Thanks again for learning about forecasting with me.
-------Sincerely, Trevor Stasik.

To return to initial post about forecasting, click HERE.

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Friday, November 2, 2007

Forecast Tracking

Okay, so you've made a forecast. Great. Does that mean that we can file it away and forget about it? NO. That would leave you reaching for the panic button when you realize that you missed all of your projected values. Forecasts are most useful as tools when they are constantly used, updated, and modified with the most recent information. It is very important that you monitor and control these forecasts to see how accurate you forecast is and how it can be improved.

To monitor how well the forecast is predicting actual values, we need to calculate a tracking signal. The tracking signal is calculated with this equation:

Tracking signal = RSFE / MAD

where RSFE is the Running Sum of Forecast Errors
and where MAD is the Mean Absolute Deviation.

In other words, the signal tells us whether we are tracking positively or negatively to our forecast. Positive tracking means that we are above our forecast. Negative means that we are below. If we are using a computer adaptive smoothing to do the modeling for us, the computer can automatically adjust our forecasts for us to reduce spikes in the forecasting below or above our model.

If the values are consistently off, that means that we have "bias" in one direction or another. However, don't hit that panic button yet. We we may want to consider a different forecasting model. Following the theory of Focus Forecasting, we should choose whatever forecasting model is best. It is okay to change models frequently, as long as it is cost effective and the new model is more accurate than the last.

Okay, that about wraps up my series covering forecasting. Thanks for reading. I will continue in my next entry with a summary of what I hope you have learned.
------Sincerely, Trevor Stasik.

To return to initial post about forecasting, click HERE.
To go to the final post in the forecasting series, click HERE.

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