A decision support system for forecast cement demand

The Indian cement industry has experienced phenomenal growth in the last decade, following the decontrol of cement in 1989. The degree of competitiveness within the industry has increased significantly. The industry scenario is changing rapidly from an era of shortages to that of surplus. The future scenario for cement industry is likely to be characterized by growing competition, significant corporate thrust on modernization, changing pattern of demand and uncertainties regarding prices as well as growth of demand in a liberalized economy dominated by market forces. Under such dynamic conditions and changing economic environment, the task of forecasting the level and the pattern of demand for cement becomes very important for the industry planning at a macro-level as well as the corporate planning at the micro-level. A computer based Decision Support System (DSS) would provide the policy makers with the necessary flexibility to analyze and derive meaningful demand forecasts for cement. Central to our DSS is a model base which has a rich library of forecasting models based on Time Series and Econometric methodology. This DSS is being used by the officers in the planning department at the Cement Manufacturers Association. It is also serving as a permanent model with enough flexibility to incorporate annual variations in the relevant factors affecting cement demand to generate revised and updated estimates on a year to year basis.