Executive Summary What is the history of fake forecasting? We cover the relationship to supply chain forecasting. Introduction This blog primarily focuses on supply chain forecasting. However, it is interesting occasionally to observe other areas of forecasting to learn from it. Wall Street is an exciting area to watch because the most money in business spent on…
Executive Summary How is data generally placed into demand planning systems? Why are some of the popular current methods so problematic? Definitions for This Article Attribute-Based Forecasting: The ability to group product by “attributes” such as Size, Flavor, Region flexibly, and relationally that supports forecasting. It creates a virtual rather than a static hierarchy. ROLAP:…
Executive Summary Causal forecasting is a method of forecasting based upon tying the forecast to a variable. Causal forecasting is little used in statistical forecasting. What Is Causal Forecasting? Causal forecasting is forecasting one value by another value. There are various forms of complexity concerning causal forecasting. However, the most simple mathematical explanation is the…
Executive Summary Forecasting software is very frequently poorly selected. There are important implications for using incorrect fitting software to requirements. Introduction In speaking recently with a consensus sales forecasting software vendor, it was explained to me that in their space many of the companies they deal with often try to use utterly inappropriate forecasting solutions…
Executive Summary In forecasting, the forecast is performed across the bill of distribution. How flexible forecasting systems work versus SPP. Pre Reading To understand this article, it is crucial to comprehend attribute-based forecasting, which is covered in this article. Our References for This Article If you want to see our references for this article and…
Executive Summary Intermittent or lumpy demand is often thought to be better forecasted with sophisticated methods. As per J. Scott Armstrong’s research and our research, more complex methods do not work with intermittent or lumpy demand. In this article, we cover using Crostons, smoothing, and the moving average for intermittent demand. Introduction: The History of…
Executive Summary The statistical forecasting is typically combined with judgment methods produced by sales and marketing to arrive at a consensus forecast. We compare these different forecasting approaches. Introduction to Consensus Forecasting There are three categories of obtaining forecast information from different people who apply to supply chain forecasting: Consensus forecasting Manual overrides to statistical…
Executive Summary There are problems with the interpretation of forecasting concepts that are exemplified by Nike’s understanding of forecasting, as explained by CIO magazine. In a CIO article, Nike and AMR make several incorrect statements around forecasting harkening back to common forecasting myths. Introduction to the Problems with Interpretation of Forecasting One of the widespread…
Executive Summary We cover the forecasting methods (aka methodologies) available in SAP DP. To use the forecasting methods, it is necessary to use the Forecast Profiles, Master Profile, the Univariate tab, MLR tab, and the Composite tab. Best fit requires setting up the Forecast Profile and the Forecast Strategies. Introduction to Forecasting Methods and Parameters…
Executive Summary What are Promotions? Promotional Forecasting in SAP DP. Promotional Planning and Lifecycle Planning. What Are Promotions? Promotion planning is designed to model one time events or repeating events. Promotions are a problem because they spike demand artificially and affect the demand history of the promoted item but often reduce the demand for related…