Individual Assignment: Sales Forecasting and Six Sigma (Week 7)

Using initially the data following, each student is to:

1. Forecast the sales for the home improvements market for Mexico City for 2008 using the moving average method. Develop a two-year and three-year moving average forecast of sales. Which one would you use? Why? Graph the actual and forecast data.
2. Forecast the sales for the home improvements market in Mexico City for 2008 using the weighted moving average method. Estimate the sales by assigning weights to three periods. State your assumption in selecting the values of the weights. Graph the actual and forecast data. c. Forecast the sales for the home improvements market for Mexico City for 2008 using expenditures per household as the explanatory (independent) variable in a linear regression analysis. Graph the actual and forecasted data.

d. Select another possible explanatory variable, in addition to expenditures per household, that could be used to forecast annual sales for the home improvement market in Mexico City. Discuss why this variable may be a good predictor of sales and where you could obtain data on this variable. Then using at least nine years of such data (predicted if necessary), calculate a second linear regression equation using your selected variable.

e. Discuss the advantages and disadvantages of the moving average, weighted moving

average, and regression analysis methods of forecasting sales. Which method(s) provides the best sales forecast for 2008 ? Why?

f. Discuss how these sales forecasts can be used to improve planning and operations at AMC.

g. Consider the possible application of Six Sigma at Acme's central customer support site, as follows: Acme's site is currently outsourced to a contractor based in India. This contractor claims that it will resolve a routine support issue within 24 hours from the time a customer logs a support request via phone or the web. An audit by Acme headquarters of 100,000 support requests finds that only five requests did not meet the 24 -hour resolution claimed. What is the highest "sigma rating" (6-sigma, 5-sigma, 4-sigma, etc.) that the support site can claim, and why? In view thereof and of other considerations, should AMC be authorized to staff and operate its own customer support site? Why or why not?

Price: $14.37

Solution: The downloadable solution consists of 7 pages, 737 words and 3 charts.
Deliverable: Word Document