Forecasting is a skill that every manager needs to learn. Forecasting can be difficult because there are many different techniques, and you need to decide which one will work best for your company. But forecasting doesn’t have to be difficult- it can help make your business more sustainable and profitable. In this article, we describe four easy steps you can take today to start implementing forecasting in your business.
However, before looking at the 4 easy steps, make sure you know about the best and easy inventory forecasting app – Inventoro!
1.Get everyone on board
Getting your employees to understand and get behind the idea of forecasting doesn’t just make it easier for you- it makes it easier for them too.
It will be much easier to implement forecasting if your employees are behind you and willing to put in the effort and time to learn and understand how to do it. If they are unaware of the benefits you will struggle to see results, and your efforts may be wasted.
2.Determine what you need forecasting for
What is the goal of your business? Is it to cut costs? Increase customer service? Will forecasting make it easier or faster to achieve that goal? Your goal will determine which forecasting method you use.
If your goal is to reduce costs then a margin-driven approach may work best for you, whereas if you want to increase customer service then maybe a Sales & Operations Planning (S&OP) approach would be more suited.
3.Pick the right technique
Once you have determined what you want to achieve it is time to pick the forecasting method that will help you get there. You can do this by assessing your company’s current capacity, capability, and process maturity level.
It’s important to implement a forecasting method that will work for your business. Trying to fit a square peg in a round hole will only make things harder. For example, using a Sales and Operations Planning approach for forecasting would be difficult if your business is new and still struggling with the basics like recording sales data accurately.
4.Take small steps to build capacity
You can’t expect all of your employees to become experts overnight- especially if they aren’t familiar with forecasting.
Your first priority should be to build the capacity of your employees. So, they are able to use the method correctly and on a consistent basis. You can do this by focusing on training, leadership, communication, and process design first.
Conclusion
If you are looking for 4 easy steps to start implementing forecasting in your business then this article is absolutely for you. It doesn’t need to be difficult or complicated.
Trying different techniques and methods is a great way to start. But you should pick the one that fits your company best before implementing it.
The four steps we outlined in this article will help get you started on forecasting for your business: 1) Get everyone on board; 2) Determine what you want forecasting for; 3) Pick the right technique; 4) Take small steps to build capacity.
It can be easy if done correctly! Keep these tips in mind when trying out new things- they may just work wonders for your company. If all of this sounds intimidating and you want help enacting these principles, let us know. Our team of experts is ready and waiting to partner with you and help you find success.