Johnson & Johnson Vision Care Product Forecasting

Company Profile

Johnson & Johnson Vision Care, Inc. is a leader in the vision correction industry. J&J revolutionized the industry in 1988 with the invention of ACUVUE® Brand Contact Lenses, the world's first soft disposable contact lens. ACUVUE® Brand Soft Disposable Contact Lenses continue to be the number one brand in the world and are worn by more people globally than any other contact lenses.

J&J Vision Care has fostered an unwavering dedication to inventive thinking and to maintaining the top standards in quality. With a workforce of approximately 2,500, J&J Vision Care makes ACUVUE® Brand Contact Lenses for people in more than 70 countries worldwide.

Through its commitment to patients and Eye Care Professionals, J&J Vision Care will continue to positively affect people's lives by investing in innovation, building the ACUVUE® Brand, inventing new products, and strengthening its position as the worldwide leader in vision care.
(www.jnjvision.com)

Situation

J&J Vision Care needed to find a way to better predict contact lens sales or company growth. J&J leaders wanted a better prediction of sales through a major national retailer and of sales through other venues. J&J also hoped that this would lead to cut costs and more effective long-term planning.

Solution

APC research assistants Jay Peake and Ana Landeros utilized several different methods to complete this project. In the first phase, designed to forecast sales of contact lenses at the major national retailer, they used SAS to analyze and run regressions on the data to formulate multiple models including possible seasonal patterns and macroeconomic variables (GDP,CPI). After evaluating the models they then chose the best three and validated them using a holdout portion of the data. In the end, Peake and Landeros chose the simplest model with the most prediction power. When the champion model had been selected, a multilayer spreadsheet was created as a user friendly tool. In the second phase (forecasting sales through other venues), the research assistants traced these steps again with the new dataset, but in addition added a CUSUM tracking chart. This tracking chart updated as new data was added to the user spreadsheet and allows the client to easily recognize when the model needs to be updated for continued forecasting accuracy.

Results

Alabama Productivity Center/ATN-UA was able to exceed J&J’s expectations. As a result of the high-quality product delivered in phase one of the project, J&J and APC/ATN-UA proceeded with phase two. APC/ATN-UA was able to provide J&J with a model that helped increase forecast accuracy, which in turn increased sales and profits.