Demand forecasting significance for contemporary process management of logistics systems

Abstract

Today's business market environment has got global and dynamic character. The supply chains of various industries are featured by huge streaming flows in them. The one of the results of world globalization trend is that the supply chains are getting more and more complex and the flows of material, information and finance are more and more bulky. In such business environment the companies should apply logistics management techniques in conjunction with process management approaches to reach desired competitive advantage level. They should develop logistics management system across their organizational structure and across their supply chains for effective planning, management and control in a cost and ecofriend way. Nowadays it's turning out that the right managerial decisions should be based on accurate demand forecast. Demand pattern drives all logistics activities in a supply chain and it's therefore crucial for effective process management of logistics system. Within the frame of particular functional parts of a company, it can be distinguished following logistics sub-systems of a company's logistics system - purchasing, production, warehousing, packaging, distribution and reverse material flows. The paper deals with very up-to-date topic how to effectively plan, manage and control huge material flows and related logistics activities within the frame of logistics process management of a company. For right setting of logistics measures, it's necessary to have high accurate demand forecast of a final product, semi-finished product or raw material. Thus a demand forecasting system is fundamental tool to get initial data to make logistics managerial decisions in a right way.