OPERATIONS MANAGEMENT

Operations Management

Operations Management

Introduction

Future demand for the product is extremely variable to the company, which is beyond their control. The appropriate demand forecasting is important because it will enable the company to take appropriate actions based on the forecasting manufacturer's orders. Therefore, in order to assess the trend of the given sales and production output, different approaches can be applied depending upon the future prospects. The data selected for Digital Cell Phone, Inc. involve time factor which includes seasonal and dimensional changes in productivity level relative to sales.

The size of the target population provides a huge potential target market for phone manufacturing companies present in the market. Global phone manufacturers are increasing their presence in the market due to low cost of production and high scaled volume capacity to increase their output. Considering the impact of seasonality and trend component for the given case, Expert Modeler will provide the best fitting model for analyzing the future trend. This model has been used because Expert Modeler transforms the data using square root or log transformation in order to have statistically significant relationship with dependent series.

Time Series Plot of Digital Cell Phone, Inc.

Time Series Plot of Digital Cell Phone, Inc. shows continuous variation in the orders level. Historical data for orders shows an inclining trend over the period from Year 2007 to Year 2009. Time series plot of the data is given below:

Graph 1: Number of Orders with Respect to Sales

A large potential customer base offers lucrative prospects to companies both within the market and those looking to enter in phone manufacturing and sales. 3G mobile devices for consumer use are estimated to account for the largest sector of the Third Generation mobile devices market, representing 66.7% of the market in volume terms (Anderson, 2007). Therefore, linear regression analysis technique ...