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Forecasting and Inventory Management

Inventory management may be the most important "lever" in the supply chain area that can affect overall corporate profitability. This program strengthens the understanding of foundational concepts and the contextual knowledge to drive improvements.

A joint venture with Smeal College of Business' Center for Supply Chain Research. Cosponsored by the Council of Supply Chain Management Professionals.

Enhance Your Competencies with a Supply Chain Certificate!

Program Objectives

This course will provide participants with practical techniques to generate more accurate forecasts and desired inventory levels as well as to monitor and improve forecasting and inventory management performance over time.  We will discuss what sources of information can be used to improve forecast and inventory management performance.  In addition, we will investigate the critical financial impacts that overinflated inventory levels may cause.

Who Should Attend

This program is for managers or analysts who are new to supply chain processes and particularly those new to working in demand management (forecasting and inventory management) or who want to improve their knowledge in the area. Those who work as functional counterparts in finance, information systems, manufacturing, or marketing will also benefit.This is a required course for those pursuing a Certificate in Supply Chain Operations.

Program Benefits

At the end of this course, you will be able to:

  • Calculate and use measures of forecast accuracy and bias
  • Forecast future sales using past sales data (time series models)
  • Explain the importance of inventory management to the firm with a focus on financial impacts including inventory carrying cost calculation and application
  • Understand how inventory can be reduced while maintaining or even raising customer service levels
  • Identify opportunities to reduce inventory or make it more productive
  • Determine how inventory objectives that differ among products having different demand patterns (e.g. stable, seasonal, short life cycle) can be managed differently
This program awards 1.5 CEUs. Penn State Continuing Education Units (CEUs) are available based on a standard of one unit per ten hours of classroom instruction. Upon completion of this program, each participant will be awarded a certificate for 1.5 Penn State CEUs earned.

    Program Content

    Purpose and importance of forecasting and inventory management

    • Understanding the resource decisions supported by the forecasting process
    • How the forecasting process fits in the sales and operations planning process of the business
    • Forecasting techniques
      • Time series and causal models
      • Ensuring the right time lag and level of aggregation
      • Incorporating expert judgment and market intelligence

    Measuring and improving forecast performance

    • Measuring forecast accuracy
    • Measuring forecast bias


    Relationship between forecasting and inventory

    Importance of inventory management

    • Financial impact of inventory
    • Inventory metrics to support and measure inventory performance
      • Inventory turns
      • Days of supply
      • Return on Assets and Return on Investment
    • Calculating inventory carrying cost
    • Using inventory costs to make decisions


    Determining appropriate inventory levels to ensure in stock levels while minimizing obsolescence

    • How to set levels
    • Discussion of how to determine best parameters (inputs) for products inventory levels


    Evaluating software used to enable forecasting and inventory management

    Value Created for You and Your Company

    In most business contexts, forecasts are needed to support resource allocation decisions.  More accurate forecasts lead to better resource allocation and thus improved financial performance, particularly by reducing the amount of inventory that must be carried.  The direct relationship that exists between forecasting and inventory management is why this course will address both key supply chain concepts together. Inventory management may be the most important “lever” in the supply chain area that can affect overall corporate profitability.  This course is designed to strengthen understanding of the foundational concepts in forecasting and inventory management and to provide participants with the contextual knowledge of how to use these concepts to drive improvements.

    Faculty Leaders

    Our programs are taught by world-class faculty leaders from Penn State, as well as supply chain professionals. Each instructor has an extensive background in research and consulting, and in educating executives. Each brings to the classroom best-practice tools and implementation processes for achieving world-class results.

    Faculty Director

    Dr. Christopher D. Norek, Senior Partner, Chain Connectors, Inc.and Senior Instructor, Penn State

    Download: Read about effective implementation practices of an S&OP program in a brief article written by Dr. Norek featured in Logistics Quarterly.

    Fees

    The program fee of $2,500 includes all instructional materials, private room accommodations, meals, break service, and access to recreational facilities. Association member pricing applies:
    $2,400 for CSCMP members
    $2,150 for CSCR corporate sponsors

    Reservations

    Our enrollment coordinator will be happy to hold a seat for you in this program. A reservation does not commit you to the program until you submit the registration form online. Please call 814-865-3435.


    Related Programs

    This is a required course for those pursuing a Certificate in Supply Chain Operations. Participants must take two others from the topics below to complete the Certificate:

    Programs may be taken in any order over any period of time. An Executive Programs representative will be happy to help you select the appropriate program for your current level of responsibility.

    This program is cosponsored by the Council of Supply Chain Management Professionals.

    Program Dates
    November 18 - 19
    Executive Education Center, University Park Campus
    May 19 - 20, 2015
    Value Creations Teams

    We support team participation to maximize the impact of content and drive change within your organization faster and more efficiently. Organizations that send three or more participants will receive significant savings. Teams also have access to the full resources of Penn State during and after the program.