Ops 571 Wk 5 Operations Forecasting Financial Metrics Paper

Week 5 Operations ForecastingPhoenixOPS/571 September 11, 2017IntroductionA forecast is a prediction or projection of a future occurrence. There are two broad categories of forecasting methods. One is the qualitative forecasting method. This method makes use of intuition, personal judgements and opinions. The method is therefore highly subjective. The second method is the quantitative forecast. This method is based on quantitative models and mathematical calculations; it is therefore objective in nature (Jacobs & Chase, 2013).Virtually all operations management decision involves input of an objective estimate of future level of activity. In this report, we are going to use time series forecasting models to make quantitative forecast of Starbucks sales revenue for Quarter 4, 2017. Time series models use historical patterns of data to predict the future pattern based on the underlying patterns in the historical data. Exponential Smoothing method uses a weighted average with weights declining exponentially as data becomes older. Trend Projection method uses the least squares to fit a straight line in the data. Trend Decomposition method decomposes data trend into its components of variability. The calculations are attached in a Microsoft Excel worksheet.Comparison