An Analytical Study of the Frequency and Determinants of Forecast Selection for Judgmental Revision

This paper examines two issues concerning the revision by marketing managers of quarterly sales forecasts initially produced by an extrapolative model. An analysis is undertaken of the extent to which the frequency of forecast revision is systematically related to the performance of the forecasting model employed. The second issue concerns the degree to which selection activity can be modelled in terms of factual and quantitative information readily available to the individuals involved in revision. A real life sales forecasting database is employed, constructed from the records of a multiproduct industrial firm. Results are discussed in the light of previous evidence on subjective revision and their managerial implications are highlighted.