CHAPTER 2

The Forecasting Process

I know no way of judging the future but by the past.

—Patrick Henry

The Forecasting Process

In this chapter we discuss the forecasting process. Why do we need a forecasting process when we just want to know how to forecast? The reason is simple. It has been shown that following a process that has been well established will help ensure forecasts with better accuracy. Otherwise we will be just generating numbers that don’t mean much. Understanding this process and the underlying principles will make you a better forecaster. This is the purpose of this chapter.

The key to generating good forecasts is to follow a well-established forecasting process. In the eagerness to quickly generate forecasts there is a temptation ...

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