When a major disruption such as 9/11 occurs, managers don’t know what the future holds and may have to put off important decisions while awaiting future data. In many cases, post-disruption conditions are unprecedented, and neither management’s prior experience nor traditional extrapolation...

Forty years ago, Henri Theil created a prediction-realization diagram to compare forecasts with the actual changes that were realized. The diagram emphasizes and element of accuracy that is not accounted for in traditional metrics—the accuracy with which you forecast the correct direction of...

From his vantage point as Senior Director of U. S. Forecasting for a major pharmaceutical firm, Jim Borneman analyzes what is takes for the pharmaceutical forecaster to successfully manage the forecasting process. He writes that the requisite skills far surpass the technical aspects of...

Ellen’s article has three key points. She advises forecasters to accept the idea that data do not have to be perfect. Instead of changing unreliable data used for reporting, she suggests that forecasters create a second set of data to be used for forecasting. She also makes the point that a...

Guest columnist Bill Bassin reviews the recent report from the Federal Reserve Bank of Cleveland on the accuracy of economic forecasters. The report’s results do not inspire confidence in our economic forecasting. Copyright International Institute of Forecasters, 2007

This article by Enrique de Alba and Manuel Mendoza extends Foresight’s previous coverage of methods for forecasting seasonal data when the historical series is short (less than 2-3 years of data). The authors describe and illustrate a Bayesian method for seasonal data and show that it can...

In forecasting short seasonal time series, Michael Leonard recommends seeking additional sources of information outside the (sparse) historical data on the items themselves. Two potentially promising sources of external information are the histories of the analogous products and of product...

Carl Klarner and Stan Buchanan (K&B) have applied an innovative approach to predicting congressional elections by pooling candidate, district-level, and national variables. National tides favored the Democrats in 2006, in the form of pro-Democratic voting intentions, low presidential approval...

New to Foresight with this issue is the column Hot New Research, written by Paul Goodwin. In each issue, Paul will summarize several new articles that address issues of importance to the forecasting practitioner. The focus for this initial column is on forecasting performance in organizations,...

Philip Franses discusses the problem of allowing seasonal patterns to change over time. He notes that most standard models presume a constant seasonal pattern; however, his preference is to use models that allow the seasonal pattern to evolve over time, such as periodic models and time-dependent...