Rationality and Foolishness: Alternative Forecasting Systems in a Manufacturing Firm

Forecasters in firms are expected to employ mathematical techniques encoded in information systems in order to predict the future demand for a firm=s goods. In practice, many forecasters have eschewed statistical methods of forecasting and depend instead on human expertise. This resistance to the ideals and technologies of forecasting has largely been understood in the literature as a failure of rationality in firms. This paper provides a social and political analysis of forecasting in a case study firm, and examines alternative rationalities present in the firm that legitimate what appears to the forecasting literature as foolish practices. The case study organization, a large manufacturing firm, undertook a process of reform of the forecasting process during the course of the study. This paper explores how resistance to a new forecasting support system was shaped by the local equilibrium that had been reached between rationalities in the firm.