Demand Planning: Refining the Forecast

Refining the forecast is the next step in the process. Any time the sales history is changed, an update is processed to the computer forecast for the level that you are on in the hierarchy. With the Demand Planning module, a top-down computer forecast can be performed to carry any changes down to all child items in the hierarchy, and multi-forecast adjustments can be processed on forecast measures.

The Final Forecast is given by the olive green entry in the table:

This corresponds to the olive coloured line in the graph, where as the working forecast is represented by the dark green dotted line:

Initially, the Computer, Working and Final forecasts are all the same. As changes are made to the forecast, these values will change. To begin the process of forecasting, select this olive green option in the table:

This expands the row entry into different measures used to calculate the final forecast for each year:

In this step, any changes made will update the Working Forecast. Notice that the Working Forecast is written in green:

💡 The Working Forecast (which is presented in the Working Forecast measure) is known as the Synchronized Forecast in IBP.

Any fields in the table that contain the grey arrow in the cell can be edited:

Any cells that have had an edit made to them have a purple arrow, which allows users to quickly see whether a cell has been amended:

Any editable cell in the table can be amended in this manner.

💡The Adjustments measure is known as the Adjusted Forecast measure in IBP, while Saved Adjustments in IBP are now called Overrides.

Practically, multiple cells need to be updated at a time, which will feed into the working forecast. To select multiple cells, select the starting cell and drag the cursor along to the final cell. Netstock will highlight the range for update:

The summary statistics based on the selection appear on the top left-hand side of the table:

Additionally, selecting multiple cells in this way opens an adjustment panel at the bottom of the screen, and displays the selected time range in the graph. In the below example, the panel is entitled “Adjusting Overrides” to match which measure is being adjusted in the table:

Should any changes made need to be undone, select the Undo button on the top right-hand side of the table. All changes made will revert back to their previous state.

There are various options to select in the adjustment panel that ease the forecasting process for the user.

Selecting "Add to" with a value in the adjustment field adds this amount to the highlighted cells within the table. In the below example, a value of 10 has been added and the Adjust button selected:

A value of 10 has then been added into each highlighted cell in the table:

Selecting "Subtract from" with a value in the adjustment field subtracts this amount from the highlighted cells within the table. In the below example, a value of 3 has been subtracted and the Adjust button selected:

A value of 3 has then been subtracted from each highlighted cell in the table:

Set to updates each value in the highlighted cells to the value specified.

For example, setting the value to 70 updates the value in each cell to 70:

Spread takes the total specified in the adjustment cell and spreads this evenly across each cell. In the below example, a value of 50 is spread across 10 months, resulting in a value of 5 for each month:

💡It is also possible to copy data from an external spreadsheet by copying the data in the spreadsheet and pasting it into the row.

The percentage increase slider increases the values in the selected cells by the percentage specified. This percentage can be typed in the field, or the slider can be used to adjust. These changes will be displayed real-time in the table and graph.

Finally, it may be useful to copy, add or subtract from other measures provided. To do this, select operation:

And then choose the source values from the drop-down list:

In the below example, Computer Forecast has been be copied to the highlighted cells:

Netstock Demand Planning allows greater control over the forecast engine by allowing users to make changes to the forecast engine in the "Adjust computer forecast" panel. This is referred to as adjusting the “Computer Forecast.”

💡 The Computer Forecast (which is presented in the Computer measure) is known as the Statistical Forecast in IBP.

To adjust the computer forecast, select the Computer option:

This will open up and adjustments panel called "Adjust computer forecast" at the bottom of the screen:

The basis on which the forecast engine makes its calculations can be changed by selecting which history basis is to be applied. Several options can be selected:

Additional reference measures will be available for selection in this list.

The forecast reactivity can be adjusted based on the emphasis on recent sales months in contrast to previous sales history. Forecasts for “High” will react more quickly to recent changes in demand than “Low”.

The max annual increase field limits the forecast growth in comparison to sales history. In contract, max annual decrease limits the forecast decline in comparison to sales history. This works in tandem with the reactivity setting: “High” reactivity forecasts will be limited based on more recent sales than “Low” reactivity forecasts.

This option sets the threshold for the identification of seasonal demand. “High” will result in more seasonal forecasts than “Low” but may come at the cost of accuracy.

The Forecast Engine has the setting to include the current period's history in the calculation. By default, this is deselected. Period-to-date is useful for new items that might not have more than 1 month of history, and where the customer wants to react quickly to sales as they happen.

To base the forecast on all previous history, the “Auto age” block is selected. This greys out the “periods” block, as the total history is used:

It may however be useful to limit how far back the forecast engine uses sales history. To do this, untick the Auto age option and enter the periods (number of months) the forecast engine must consider to calculate demand. In the below example, the forecast engine will look back two years only:

The level and scope of the demand graph can be adjusted visually using the sliders:

For example, increasing the level adjusts the demand level on the graph:

Decreasing the slope has the resultant effect on the graph:

Changes to the Level and Scope sliders are reflected numerically in the popup table for ease of reference:

In the event that the current demand adjustment settings are necessary for use on other attributes in the hierarchy, they can be saved as a "Profile" for later use. This is very useful in situations where demand can be carried across to items requiring a matching profile:

To do this, select the profiles option:

This opens a Forecast profiles screen. Add the name of the profile to be stored, and click save:

This profile can now be applied to any calculated forecast view on the table.

Any profiles that are no longer required can be removed from this screen by selecting the Delete button next to the profile:

Any of the available profiles can be selected from this screen as well:

💡 A Profile is known as the Seasonal Index in IBP.