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Forecasting and Risk Analysis in Supply Chain Management: GARCH Proof of Concept

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Managing Supply Chain Risk and Vulnerability

Abstract

Forecasting is an underestimated field of research in supply chain management. Recently advanced methods are coming into use. Initial results presented in this chapter are encouraging, but may require changes in policies for collaboration and transparency. In this chapter we explore advanced forecasting tools for decision support in supply chain scenarios and provide preliminary simulation results from their impact on demand amplification. Preliminary results presented in this chapter, suggests that advanced methods may be useful to predict oscillated demand but their performance may be constrained by current structural and operating policies as well as limited availability of data. Improvements to reduce demand amplification, for example, may decrease the risk of out of stock but increase operating cost or risk of excess inventory.

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Author information

Authors and Affiliations

  1. Engineering Systems Division, Department of Civil and Environmental Engineering, MIT Forum for Supply Chain Innovation, School of Engineering, Massachusetts Institute of Technology, 77 Massachusetts Avenue, 02139, Cambridge, MA, USA

    Shoumen Datta

  2. INNOVEX LLC, Kent, OH, USA

    Don P. Graham

  3. Retail Inventory Management, OfficeMax Inc, 263 Shuman Boulevard, 60563, Naperville, IL, USA

    Nikhil Sagar

  4. Department of Mathematics and Computing, Centre for Innovation in Distributed Systems, Institute of Technology Tralee, Tralee, Kerry, Ireland

    Pat Doody

  5. OfficeMax Inc, 263 Shuman Boulevard, 60563, Naperville, IL, USA

    Reuben Slone

  6. Kouvola Research Unit, Lappeenranta University of Technology, Prikaatintie 9, 45100, Kouvola, Finland

    Olli-Pekka Hilmola

Authors
  1. Shoumen Datta
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  2. Don P. Graham
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  3. Nikhil Sagar
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  4. Pat Doody
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  5. Reuben Slone
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  6. Olli-Pekka Hilmola
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Editor information

Editors and Affiliations

  1. Department of Industrial Engineering, Ira A. Fulton School of Engineering, Arizona State University, 875906, 85287-5906, Tempe, AZ, USA

    Teresa Wu

  2. Department of Logistics, Operations and Management Information Studies, College of Business, Iowa State University, 50011, Ames, IA, USA

    Jennifer Blackhurst

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© 2009 Springer-Verlag London Limited

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Datta, S., Graham, D., Sagar, N., Doody, P., Slone, R., Hilmola, OP. (2009). Forecasting and Risk Analysis in Supply Chain Management: GARCH Proof of Concept. In: Wu, T., Blackhurst, J. (eds) Managing Supply Chain Risk and Vulnerability. Springer, London. https://doi.org/10.1007/978-1-84882-634-2_10

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  • DOI: https://doi.org/10.1007/978-1-84882-634-2_10

  • Publisher Name: Springer, London

  • Print ISBN: 978-1-84882-633-5

  • Online ISBN: 978-1-84882-634-2

  • eBook Packages: EngineeringEngineering (R0)

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