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Interaction of Judgemental and Statistical Forecasting Methods: Issues & Analysis

Author

Listed:
  • Derek Bunn

    (London Business School, Sussex Place, Regent's Park, London NW1 4SA England)

  • George Wright

    (Strathclyde Business School, Glasgow G4 OGE, United Kingdom)

Abstract

This paper reviews several of the current controversies in the relative value of judgemental and statistical forecasting methods. Where expert, informed judgemental forecasts are being used, a critical analysis of the evidence suggests that their quality is higher than many researchers have previously asserted, and circumstances favourable to this are identified. The issue of the interaction of judgemental and statistical methods is, however, identified as a more worthwhile line of inquiry, and research in this area is reviewed, differentiating approaches aimed at synthesising both of these inputs.

Suggested Citation

  • Derek Bunn & George Wright, 1991. "Interaction of Judgemental and Statistical Forecasting Methods: Issues & Analysis," Management Science, INFORMS, vol. 37(5), pages 501-518, May.
    • Handle: RePEc:inm:ormnsc:v:37:y:1991:i:5:p:501-518
    DOI: 10.1287/mnsc.37.5.501
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    Citations

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    Cited by:

    1. A A Syntetos & J E Boylan & S M Disney, 2009. "Forecasting for inventory planning: a 50-year review," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 60(1), pages 149-160, May.
    2. Danese, Pamela & Kalchschmidt, Matteo, 2011. "The impact of forecasting on companies' performance: Analysis in a multivariate setting," International Journal of Production Economics, Elsevier, vol. 133(1), pages 458-469, September.
    3. Yuehjen Shao & Yue-Fa Lin & Soe-Tsyr Yuan, 1999. "Integrated application of time series multiple-interventions analysis and knowledge-based reasoning," Journal of Applied Statistics, Taylor & Francis Journals, vol. 26(6), pages 755-766.
    4. Vicki G. Morwitz & David C. Schmittlein, 1998. "Testing New Direct Marketing Offerings: The Interplay of Management Judgment and Statistical Models," Management Science, INFORMS, vol. 44(5), pages 610-628, May.
    5. Nelson, Rohan & Cameron, Andrew & Xia, Charley & Gooday, Peter, 2022. "The ABARES Approach to Forecasting Agricultural Commodity Markets," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 30(6), November.
    6. Webby, Richard & O'Connor, Marcus, 1996. "Judgemental and statistical time series forecasting: a review of the literature," International Journal of Forecasting, Elsevier, vol. 12(1), pages 91-118, March.
    7. Arvan, Meysam & Fahimnia, Behnam & Reisi, Mohsen & Siemsen, Enno, 2019. "Integrating human judgement into quantitative forecasting methods: A review," Omega, Elsevier, vol. 86(C), pages 237-252.
    8. Etienne Theising & Dominik Wied & Daniel Ziggel, 2023. "Reference class selection in similarity‐based forecasting of corporate sales growth," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 42(5), pages 1069-1085, August.
    9. Savolainen, Jyrki, 2016. "Real options in metal mining project valuation: Review of literature," Resources Policy, Elsevier, vol. 50(C), pages 49-65.
    10. Bunn, Derek W., 1996. "Non-traditional methods of forecasting," European Journal of Operational Research, Elsevier, vol. 92(3), pages 528-536, August.
    11. Jyrki Savolainen & Ramin Rakhsha & Richard Durham, 2022. "Simulation-based decision-making system for optimal mine production plan selection," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 35(2), pages 267-281, June.
    12. Song, Haiyan & Gao, Bastian Z. & Lin, Vera S., 2013. "Combining statistical and judgmental forecasts via a web-based tourism demand forecasting system," International Journal of Forecasting, Elsevier, vol. 29(2), pages 295-310.
    13. Leitner, Johannes & Leopold-Wildburger, Ulrike, 2011. "Experiments on forecasting behavior with several sources of information - A review of the literature," European Journal of Operational Research, Elsevier, vol. 213(3), pages 459-469, September.
    14. Onkal, Dilek & Muradoglu, Gulnur, 1996. "Effects of task format on probabilistic forecasting of stock prices," International Journal of Forecasting, Elsevier, vol. 12(1), pages 9-24, March.
    15. Leenheer, Jorna & Bijmolt, Tammo H.A., 2008. "Which retailers adopt a loyalty program? An empirical study," Journal of Retailing and Consumer Services, Elsevier, vol. 15(6), pages 429-442.
    16. Song, ChiUng & Boulier, Bryan L. & Stekler, Herman O., 2007. "The comparative accuracy of judgmental and model forecasts of American football games," International Journal of Forecasting, Elsevier, vol. 23(3), pages 405-413.
    17. Bunn, Derek W. & Salo, Ahti A., 1996. "Adjustment of forecasts with model consistent expectations," International Journal of Forecasting, Elsevier, vol. 12(1), pages 163-170, March.
    18. Perera, H. Niles & Hurley, Jason & Fahimnia, Behnam & Reisi, Mohsen, 2019. "The human factor in supply chain forecasting: A systematic review," European Journal of Operational Research, Elsevier, vol. 274(2), pages 574-600.
    19. Anderson, Elizabeth A., 1995. "Judgmental and statistical methods of peak electric load management," International Journal of Forecasting, Elsevier, vol. 11(2), pages 295-305, June.
    20. Phillip M. Yelland & Shinji Kim & Renée Stratulate, 2010. "A Bayesian Model for Sales Forecasting at Sun Microsystems," Interfaces, INFORMS, vol. 40(2), pages 118-129, April.
    21. Collan, Mikael, 2004. "Giga-Investments: Modelling the Valuation of Very Large Industrial Real Investments," MPRA Paper 4328, University Library of Munich, Germany.
    22. Remus, William & O'Connor, Marcus & Griggs, Kenneth, 1995. "Does reliable information improve the accuracy of judgmental forecasts?," International Journal of Forecasting, Elsevier, vol. 11(2), pages 285-293, June.
    23. Bartezzaghi, Emilio & Verganti, Roberto & Zotteri, Giulio, 1999. "A simulation framework for forecasting uncertain lumpy demand," International Journal of Production Economics, Elsevier, vol. 59(1-3), pages 499-510, March.
    24. Stewart, Thomas R. & Roebber, Paul J. & Bosart, Lance F., 1997. "The Importance of the Task in Analyzing Expert Judgment," Organizational Behavior and Human Decision Processes, Elsevier, vol. 69(3), pages 205-219, March.
    25. Somerville, R. A. & Taffler, R. J., 1995. "Banker judgement versus formal forecasting models: The case of country risk assessment," Journal of Banking & Finance, Elsevier, vol. 19(2), pages 281-297, May.

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