Managing Sales Forecasters

de Bruijn, Bert; Franses, Philip Hans

doi:10.2139/ssrn.2184281

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Managing Sales Forecasters

Tinbergen Institute Discussion Paper 12-131/III

34 Pages Posted: 5 Dec 2012

See all articles by Bert de Bruijn

Bert de Bruijn

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Philip Hans Franses

Erasmus University Rotterdam (EUR) - Department of Econometrics

Date Written: December 3, 2012

Abstract

A Forecast Support System (FSS), which generates sales forecasts, is a sophisticated business analytical tool that can help to improve targeted business decisions. Many companies use such a tool, although at the same time they may allow managers to quote their own forecasts. These sales forecasters (managers) can take the FSS output as their input, but they can also fully ignore the FSS outcomes. We propose a methodology that allows to evaluate the forecast accuracy of these managers, relative to the FSS, while taking aboard latent variation across managers' behavior. We show that the results, here for a large Germany-based pharmaceutical company, can in fact be used to manage the sales forecasters by giving clear-cut recommendations for improvement.

Keywords: Forecast Support System, Sales forecasters, Forecast accuracy

JEL Classification: M11, M31

Suggested Citation: Suggested Citation

de Bruijn, Bert and Franses, Philip Hans, Managing Sales Forecasters (December 3, 2012). Tinbergen Institute Discussion Paper 12-131/III, Available at SSRN: https://ssrn.com/abstract=2184281 or http://dx.doi.org/10.2139/ssrn.2184281