Question

What are the main advantages that quantitative techniques for forecasting have over qualitative techniques? what limitations do quantitative techniques have?

Answer 1

Quantitative forecasting techniques are objective, handle large amounts of data, and identify numerical patterns effectively, but they require historical data and may neglect qualitative factors like consumer opinions. The value placed on quantitative vs. qualitative research depends on the research context and questions.

Step-by-step explanation:

Quantitative forecasting techniques offer several primary advantages over qualitative techniques. They are typically more objective, as they rely on numerical data and statistical methods for analysis. This allows for the processing of large amounts of data to identify patterns and trends that can be projected into the future. An example of this might be using historical sales data to predict future demands.

However, quantitative techniques also have their limitations. They require substantial historical data to be effective and are less suited to predicting the impact of new or unprecedented changes. Furthermore, they can overlook qualitative factors such as consumer opinions or brand loyalty, which might not be easily quantifiable but are still very important for accurate forecasting.

In deciding whether to place more value on quantitative or qualitative research, it depends on the context and the specific research questions at hand. For instance, quantitative data might offer more precise insights for close-ended questions or when measuring specific variables, while qualitative data is often better for exploring complex, contextual, or new phenomena where numbers cannot tell the whole story.

Answer 2

Quantitative techniques are mathematically computed based on numerical data. They rely on historical data and that what happened in the past will continue to happen in the future.

Limitations that quantitative techniques have are that sometimes there is not enough tie to gather the data needed for a quantitative forecast and you must rely on the experience and the intuitive opinion of the managers.