Calculating the Forecast Values

The forecast calculates the forecast values by using various mathematical formulae which evaluate historical data. The accuracy of the forecast basically depends on the extent and quality of the data that is available.

You only enter historical values when you create a new article master record or when the system creates a new article master record via batch input. The system then generates these values using withdrawal postings.

The system recalculates the basic value and the trend value for each forecast by using the smoothing factors and the most recent consumption values. The smoothing factors are the weighting factors used for historical data, with the values from the most recent period playing a more important role in the forecast than the values from previous periods. The greater the smoothing factors you select in the article master, the faster the forecast values are adapted to the actual past consumption values.

For more details on the forecast formulae see Overview

If your system is set so that the forecast values are to be taken into account for a planning run, then a so-called planning file entry is automatically made by creating a forecast requirement independent of the forecast result. In turn, this planning file entry initiates a new planning run for the articles affected.

For articles planned by reorder point planning, however, a requirements planning run is only initiated if the new reorder level, recalculated during the forecast, differs from the old level.