Step 1: Identify the problem(s) and uncertainties.
What exactly is the problem… Customers (Sears & True Value Hardware) have been complaining about late shipments.Unreliable forecasting for Padreto items (i.e. Bow Rake) |

The problem is this … The production department do not know how marketing is coming up with their forecasts.There are usually shortages toward the end of the yearForecasts are done by the month for the following yearForecasts are usually reduced by at least 10 percent or more by Phil due to price of steelProduction feel that the forecasts are overinflated compared to the actual customer demandMarketing’s technique for forecasting is based on actual shipments and not the actual demand.Forecast are done based on a judgmental basis instead of using quantitative methodsCost for the company need to be reduced and inventory levels need to be accurate |

This is an important problem because… New sales will not be acquired, it will become hard to retain loyal customers, thus net income will be lower than where it could be. |

The key question(s) that needs to be answered to solve this problem is… What method of inventory should be usedWho should do the forecastingHow can Yankee Fork increase profits while decreasing cost while ensuring that the company has the adequate amount of inventoryWhat inventory should Yankee Fork promote and when should it be promotedHow can Yankee Fork become more competitive |

Step 2: Obtain information.
The following information is needed to answer this question… Interview Phil Stanton (ask him about delivery service use, machinery usage, and the accuracy of the inventory)Interview Ron (ask him about regional sales, promotions and non-adjusted items) Observe the production layoutNeed to find out what promotions are being run and how often and which location are they being run.Yankee Fork need to find