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FVA Rattling Bones in the Orthopaedic Devices Industry

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By Topics | Advanced Analytics

No, BONEZONE is not the website of wayward legislators. It is, however, a trade journal of the orthopaedic devices industry, and the Summer 2011 issue features a nice mention of Forecast Value Added (FVA) analysis in an article by Tom Wallace.

In "Forecasting: It's Getting Better," Tom refers to FVA as a "breakthrough technique," and "the Lean Manufacturing approach applied to Sales Forecasting." He goes on to say:

This is a superb tool to segment the products to be forecasted, to put some “on autopilot” by using naïve forecasts, and then devote more time, effort and IQ to the ones that respond to superior forecast models and the other elements [like collaboration with field sales and marketing].

So if you won't take it from me, please take it from a trustworthy guy like Tom Wallace, and give FVA analysis a try. (And if you do try it at your organization, I invite you to share your findings in a guest post on The BFD.)

APICS & IBF Sales and Operations Planning Conference

Join Tom and me next week in Chicago, where Tom chairs the APICS & IBF Best of the Best S&OP Conference. I'll be presenting on "Lean Forecasting" with Mark Hahn, Sales Forecasting and Analysis at Amway. Also looking forward to Sean Shubert and Diana Mark's presentation on business unit / corporate collaboration, which will describe how FVA analysis is helping drive forecasting performance gains at Newell Rubbermaid. (Preview abstracts here.)

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About Author

Mike Gilliland

Product Marketing Manager

Michael Gilliland is a longtime business forecasting practitioner and formerly a Product Marketing Manager for SAS Forecasting. He is on the Board of Directors of the International Institute of Forecasters, and is Associate Editor of their practitioner journal Foresight: The International Journal of Applied Forecasting. Mike is author of The Business Forecasting Deal (Wiley, 2010) and former editor of the free e-book Forecasting with SAS: Special Collection (SAS Press, 2020). He is principal editor of Business Forecasting: Practical Problems and Solutions (Wiley, 2015) and Business Forecasting: The Emerging Role of Artificial Intelligence and Machine Learning (Wiley, 2021). In 2017 Mike received the Institute of Business Forecasting's Lifetime Achievement Award. In 2021 his paper "FVA: A Reality Check on Forecasting Practices" was inducted into the Foresight Hall of Fame. Mike initiated The Business Forecasting Deal blog in 2009 to help expose the seamy underbelly of forecasting practice, and to provide practical solutions to its most vexing problems.

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