M Open Forecasting Center
Forecasts are essential for practically all business decisions:
From setting up appropriate inventory or service levels and credible budgets to evaluating long-term strategic investments. The first objective of the expanding field of forecasting is to offer accurate predictions contributing to the success of such decisions. Its second, equally important goal is to provide precise estimates of the uncertainty inherent in all predictions and how to be able to deal with the resulting risks.
The M Open Forecasting Center (MOFC) conducts cutting-edge forecasting research, provides business support and training with emphasis on: achieving accurate predictions, estimating the levels of uncertainty, avoiding costly mistakes and applying best forecasting practices to businesses.
The mission of the MOFC is to conduct multidisciplinary research in the area of forecasting with emphasis on accuracy and uncertainty and to expand the utilization of forecasting to business firms by identifying their needs, suggesting the most appropriate way of fulfilling them, demonstrating its benefits in reducing costs and/or improving profits while also avoiding untested practices.
The Center’s vision is to improve, as much as possible, the accuracy of forecasting as well as the correct estimation of uncertainty and to offer specific suggestions on how such improvements can be made and how to rationally deal with the ensuing risks.
The two equally important forecasting objectives
- Providing decision and policy makers with objective information, based on the M Competitions and other empirical studies, on how to achieve as accurate predictions as possible for their specific needs, taking into account their budget constraints.
- Estimating the level of uncertainty in their forecasts as precisely as possible and suggesting ways on how to deal realistically and effectively with the risks involved, knowing well that uncertainty creates anxiety and fear while the associated risks are often downgraded or even completely ignored.
Achieving both the above objectives would require a combination of the following:
- Utilizing the accumulated academic knowledge: There is already a considerable body of forecasting knowledge from academia that needs to be cataloged and made available to practitioners to use in order to improve their forecasting.
- Applying best practices: Conducting periodic forecasting surveys among practitioners to identify and catalogue best practices to be made available to business people who can adopt them to improve the forecasting of their firm.
- Avoiding common, harmful mistakes: Firms not being aware of available academic knowledge and best practices misuse forecasting with negative consequences to their operations and profitability. The most common of these practices will be identified and their negative implications explained in order to be avoided in the future.
- Continuing academic research: Continuing academic research will serve two purposes. First, to identify new, more accurate and more successful methods in estimating uncertainty and second to confirm available findings about the most appropriate method(s) to use for specific situations and budget constraints.