3. Flowchart the discovered As-Is forecasting process currently done at Quality Pumps Company based on consultant interview notes.

Quality Pumps Company is a leading manufacturers of commercial building booster pumps and hot water recirculating pumps. The pumps are sold in four different product lines - one is a family of booster pumps, the other the recirculation units. The market for commercial building booster pumps is very competitive, and projects for installation are on tight deadlines. These two factors compel Quality Pumps Company to offer competitive pricing while retaining reliable engineered designed products and on time delivery. Booster pumps represent a relative mature market. Product lifecycles run from 10 to 20 years in length. Unless new innovative products at competitive prices are developed or there is large commercial building development occurs, the prospect for increases in sales are not forecasted. The way to grow the company is to generate new sales and retain old customers by providing superior customer service and deliver a quality product on time. Recently, the CEO of Quality Pumps Company has been receiving calls from long-time, relatively large customers that represent more than 60% of annual sales to the company, complaining about late shipments. These customers have on going construction projects that must meet deadlines. Late delivery of pump systems causes a lot of problems for Quality Pumps' customer - including project delay cost and penalties. The CEO has noticed a loss in sales and loss of old reliable customers. The CEO decided to hire a business process management consultant to investigate Quality Pumps Company operations to see what the critical issue is that is causing late product delivery. The first think the consultant does is introduce herself to the company leadership. She outlines her objective: to document the relevant process related to production of product lines. She informs the leadership that she will initially use the two process discovery methods. One, she will observe all operations and then she will interview key leadership staff. After observing and documenting all production process. She embarks on interviewing the Operations Director and the Marketing Director. The Operations Director interview notes are below: Planning and Forecasting is informal around here. Since the product lifecycles are long, we don't anticipate major changes in our sales volume. It all starts with marketing, who oversees forecasting. First the Marketing Director requests the previous year sales shipments, per month, per product line. From this data, the marketing director uses his judgement method to come up with the following year's monthly forecast of the product lines. This forecast planning request is passed on to me to procure all associated inventory to meet plan. It is my opinion that the forecast submitted are inflated. They are inflated for many reasons in my opinion. One is to show expected growth, but also, they in marketing have big heads. I must be careful with submitted forecast for procuring to plan to inventory material is very capital intensive. I take the step to reduce plan by 5%. I use this modified forecast to generate the monthly manufacturing plan and inventory. This system works well if the original forecast submitted by marketing is accurate. Otherwise, we stumble on deliveries. Marketing, during the fiscal year, specially in the second half of the year, when they are behind sales forecast, comes to me with new promotions, which wreaks havoc with inventory and manufacturing plans. The Consultant then decides to speak with the Marketing Director. Here are her notes: Things do not change here year to year since the market is mature. Yes, sometimes we do put on sales promotions in the second half of the year to increase, catch up with sales forecast, but we feel we give operations plenty of time for planning and execution. The demand for sales promotions usually kicks in two weeks after campaign. For the annual forecast, I meet with several regional managers to over previous year product line shipments. And we also talk about future sales promotions. We then have an informal meeting to discuss changes in the economy, geopolitical issues, and shortages we might have experienced the previous year. Based on shipment data and this discussion, I come up with a monthly product line forecast. Although we invest a lot of time on forecasting, we never seem to avoid customer problems. During the meeting with the Marketing Director, the consultant asks for the circulator pump product line shipments from the past four years