Managing functional biases in organizational forecasts
Subtitle: a case study of consensus forecasting in supply chain planning
By: Rogelio Oliva, Noel Watson
Contributors: Watson, Noel; Harvard Business School. Division of Research
Series: Working paper / Division of Research, Harvard Business School -- 07-024; Working paper (Harvard Business School. Division of Research) -- 07-024
Publisher: Division of Research, Harvard Business School
Published: 2006
Place of publication: Boston]
Language: eng
Number of pages: 33
Description: To date, little research has been done on managing the organizational and political dimensions of generating and improving forecasts in corporate settings. We examine the implementation of a supply chain planning process at a consumer electronics company, concentrating on the consensus forecasting approach around which the process revolves. Our analysis reveals how the implemented forecasting process manages the political conflict and individual and group biases occasioned by organizational differentiation. We categorize the sources of functional bias into intentional, driven by misalignment of incentives, and unintentional resulting from informational and procedural blindspots. We find consensus forecasting, despite a number of characteristics of that make it a challenge to fit to a dynamic supply chain environment, to be effective in that context. We further show that the forecasting process, together with the supporting mechanisms of information exchange and elicitation of assumptions, is capable of managing the political conflict and the informational and procedural shortcomings that accrue to organizational differentiation.
Notes: "Draft: October 10, 2006"--Added t.p.

Includes bibliographical references.