Book reviews 643

Taming the Future deserves the attention of forecasters in pointing us toward the importance of long term factors and suggesting one approach to incorporate these in our forecasting efforts. Its recommendations ought to be assessed carefully. Its forecasts might occasion us to reconsider our investments over the nest few years.

Alan L. Porter Georgia Tech

Atlanta, GA, USA

Stephen F. Witt and Christine A. Witt, 1992, Modeling and Forecasting Demand in Tourism (Academic Press, London), pp. 195, ISBN 0-127- 60740-4, f35.00.

The forecasting of services, and, in particular, the forecasting of tourism demand is a valuable tool for decision makers engaged in a number of industries (airlines, shipping, hotels, food and catering, etc.) as well as for governments and national tourist organizations. The development of accurate forecasts of tourism demand enables these organizations to plan more successfully.

The book by Stephen and Christine Witt, a response to the recent growth in tourism world- wide, reports a study comparing the accuracy of six univariate time series methods and economet- rics to forecast tourism demand. The study uses data from four countries: France, Germany, the UK and the USA. The book is a contribution to the forecasting literature in two ways. First, it reports on a research study focusing on the evaluation of forecasting methods. Second, it serves as an example of forecasting in a particu- lar field. Rather less emphasis is placed on the implementation of forecasting results for specific decisions, however, than is placed on the relative accuracy of the methodologies themselves.

The authors describe forecasting methods that are widely used in forecasting tourism demand. They indicate differences between causal and non-causal methods. For example, in Chapter 3, the specification of econometric models is con- sidered. Witt and Witt identify independent vari- ables such as population, income, prices and the dummy, trend, lagged and dependent variables.

Their explanation of the econometric model esti- mation is lucid. In Chapter 4, they provide an example to illustrate the selection of a particular independent variable that best explains the inter- national tourism demand. They also explain the procedure for estimating equations and model diagnostic checking using the Durbin-Watson statistic and correction signs. Application exam- ples for France, Germany, the UK and the USA are included. The style of explanation and ap- proach used by the authors are appropriate for a practitioner audience. An introduction to quan- titative versus qualitative forecasting methods would have been helpful, however, before treat- ing the quantitative methods in some depth. Also, the authors could have stressed more to readers that only a limited number of methods are considered in the text.

One focus of the book concerns the selection of forecasting methods. For example, the au- thors investigate the kinds of criteria managers use when selecting a method to forecast tourism demand. Included in Chapter 10 is a comparative analysis on this topic. Witt and Witt compare a survey conducted by Robert Carbone and Scott Armstrong in 1982 with a similar survey carried out by themselves at the ‘Tourism in the 1990s’ conference held in London in 1986. The results of both surveys suggested that the most im- portant factor considered in choosing a forecast- ing method is accuracy.

Thus, a second and central issue discussed in the text is the evaluation of forecasts. The au- thors include a review of most of the different measures available for forecast evaluation. The review of the literature is thorough, both in the general forecasting area and in tourism. Com- parisons of forecasts involve ranking of forecasts by accuracy and comparisons for the four coun- tries in the study. In Chapters 7 and 8, Witt and Witt discuss directional accuracy using MAPE and RMSPE as well as trend change accuracy. They highlight the importance of observing trend changes and their impact on different tourism products. They illustrate the empirical results of the performance of the seven forecasting meth- ods in the study across the four countries in terms of the percentage of trend changes forecast correctly over a 1 year time horizon.

The accuracy of published forecasts for tour- ism demand measurement is also considered.

Two examples are evaluated in detail: ‘The In- ternational Travel and Tourism’ and the ‘Travel Analysis Model’ forecasts produced by Coopers and Lybrand. Witt and Witt conclude that the accuracy of both these published forecasts is no greater than that of the random walk model.

The text is an excellent reference for use at either the undergraduate or graduate level. It is thoroughly researched and, in particular. pro- vides a valuable source of literature about tour- ism forecasts. It is also a useful tool for prac- titioners interested in forecasting tourism de- mand. In addition, the book can be used as a special forecasting application for those inves- tigating international applications of forecasting methodologies or for those teaching in an inter- national setting. Witt and Witt provide a good, well-written addition to the forecasting li- terature.

Essam Mahmoud American Graduate School oj

International Management Arizona, U.S.A.

Stephen A. Delurgio and Carl D. Bhame, 1991, Forecasting Systems for Operations Management (Business One Irwin, Homewood, IL), pp. 648, hardback, US$49.95.

The book is intended for managers and analysts who use and prepare forecasts for decision- making in operations management. It is directed to all levels of management within an organiza- tion whether in manufacturing or service indus- tries. Although it is written for readers at the college-level, perhaps at the first-year MBA level. there are no difficult statistical or mathe- matical discussions. For example. the presenta- tion does not cover ARIMA methods. However, an introductory statistical background is helpful.

It is a good reference book; it is very readable and the material is well referenced for readers interested in more detailed discussions. Both up-to-date and classical reference works are in- cluded. In addition, although it is not a text

book, it is intended for use in preparation for the master planning and the inventory management examinations in the APICS Certificate in Pro- duction and Inventory Management (CPIM) program.

The purpose of the book is to the fill the gap between the hundreds of books on forecasting methods and the multitude of books in the gen- eral area of management information systems. The authors seek to address both ‘the art and science of forecasting’. Even though 40% of the book (276 of 648 pages) discusses fore- casting methods, the authors focus on how to forecast rather than how to do statistics or mathematics.

The book is based on the concept that a good forecasting system is much more than a good forecasting software package. The authors dis- tinguish between a forecasting method (‘a mathematical or subjective technique for generating a forecast’) and a forecasting system (‘a computer-based system to collect demand data. produce forecasts, provide managerial in- terface and interaction, generate output reports, provide system control and maintenance, and maintain database records’). The authors outline and discuss all the parts of a forecasting system except for the database records. It is not clear why the topic is not covered in their book. even though they identify it as an important part of a forecasting system.

The authors note that “forecasting systems are considerably more complex than forecasting methods”. To cover this complex subject as broadly as possible. they divide the book into six parts:

( 1) Introduction to Forecasting Systems - Fore- casting & Operations Management;

(2) Forecasting System Applications - Manufac- turer. Manufacturer-Distributor, and Retail, Maintenance & Remanufdcturer Fore- casting;

(3) Introduction to Forecasting Methods - Statistical Fundamentals and Comparing & Selecting Methods;

(4) Forecasting Methods - Smoothing, Regres- sion & Decomposition, Fourier Series, and Accuracy & System Control;

(5) Forecasting System Design and