Applying the volatility models for supply chain forecasting: The case of the Taiwanese TFT-LCD industry

Abstract

The bullwhip effect denotes that an augment in demand variability on the supply chain can enlarge its influences through an undertaking's supply chain. The question of forecasting is very important in upstream industrial background because the upstream partners look to be decreased from downstream consumer demand. The supply chain forecasting system must ponder the volatility of demand. The purpose of this study is to supply the volatility models for supply chain forecasting. This study uses the model for production forecasting of Taiwanese TFT-LCD industry. The results illustrate that the proposed volatility GARCH models a meliorate the prediction accuracy for production forecasting in the supply chain.