FORESTCAST ACCURACY IN SAP IBP

How to Run Forecast Accuracy in IBP?

Target Audience:

  • People who are keen to learn Production Planning.
  • People who are keen to learn Supply Chain Management.

    • Pre-requisite:Basic knowledge of Model Configuration Guide, Supply Chain Management and Production Planning.

What is Forecast Accuracy?

What is Forecast Accuracy? It is the degree of closeness of the statement of quantity to that quantity’s actual (true) value. The actual value usually cannot be measured at the time the forecast is made because the statement concerns the future. Forecast accuracy is how accurate the forecast is. It is calculated by:



Forecast accuracy can be found by two methods:
  1. Simple Average Forecast:

    2. Simple Average Forecast = SUM (Price) / Number of different product/location combinations

  2. Weighted Average Forecast:

    3. Weighted Average Forecast = SUM (Price*Forecasted Qty) / SUM (Forecasted Qty)

Instead of using several complex calculations, use the IBP_WEIGHTEDAVG function to calculate weighted average for a key figure in one step. It is calculated by using key figure.

Average Weighted = IBP_WEIGHTEDAVG (, < KEY FIGURE@PLANLEVEL> or , )
Here,
First Parameter = input key figure at input planning level.
Second Parameter = input key figure at the input planning level or attribute.
Third Parameter = type of numerator

In IBP, calculate the simple average and weighted average of different customer, locations and products by using above key figure.


Summary:

Forecast accuracy is the process, which is used to find the closeness value by using Actual Quantity, Forecast Quantity, Simple average forecast and Weighted average forecast.

Author

Roshan Deshmukh
SAP IBP/ Asprova Consultant Baranwal Consultancy and Services (BCS), Pune, Maharashtra, India

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