Professor Shor publishes in Operations Research Letters

505567Professor Mikhael Shor has had his paper, “How collaborative forecasting can reduce forecast accuracy,” accepted by Operations Research Letters.

The brief article compares an independent supplier and retailer who each forecast consumer demand with a jointly-profit-maximizing supplier and retailer who share their forecasts of consumer demand. The move from non-collaborative to collaborative forecasting can have the unexpected impact of decreasing demand forecast accuracy while still increasing profit. Therefore, collaborating firms should maintain a focus on profits, not forecast accuracy, as the appropriate measure of success.