OM Explorer

Solver - Time-Series Forecasting

This general-purpose solver allows you to search for an appropriate time-series forecasting model from a selection
of four basic methods: moving average, weighted moving average, exponential smoothing, and trend-adjusted
exponential smoothing. To facilitate the search, it provides four different measures of forecast error: cumulative sum
of forecast errors (CFE), mean absolute deviation (MAD), mean squared error (MSE), and mean absolute percent
error (MAPE). The solver also provides for each model selected a forecast for one or more periods into the future.

The Inputs sheet allows up to 100 historical data points. You can choose the frequency of the observations --
daily, weekly, monthly, quarterly, yearly, or every n periods. Begin entering data in the first tinted column, working
from top to bottom and left to right through the four columns. Do not skip cells; fill an entire column before
entering data in the next one.

After entering data, go to the Worksheet. For moving-average approaches, supply the number of periods from
which to take the average; also supply weights for the weighted moving average. For exponential smoothing, provide
a value for (between 0 and 1). The initial forecast is set as the actual data in the first period but can be changed.
For trend-adjusted exponential smoothing, provide and plus an initial trend. The initial average is set as the
actual demand in the intial period but can be changed. Once you've entered these parameters, you'll find
forecasts and the errors for all past periods, except possibly the first few if the actual demand data are used
in the startup process.

With weighted moving averages, if you are working with quarterly data, and want to test of seasonality, you should
have at least 4 periods in the model, and give some significant weight to the 4th most recent period. If you want
to test how well the nave forecast performs, use the moving average method with the number of periods equal to 1.
It is no longer an averaging method, but it does show the nave forecasting method's performance.

In the Results sheet, you'll find the CFE, MAD, MSE and MAPE results, along with the forecasts for future periods.
For exponential smoothing and trend-adjusted exponential smoothing the error in the initial period is not included in
the error analysis. You can set the starting period for error analysis

Click here to continue.

 Inputs
Solver - Time-Series Forecasting

Period # Data Period # Data Period # Data Period # Data

1 12 26 51 76
2 17 27 52 77
3 20 28 53 78
4 25 29 54 79
5 13 30 55 80
6 14 31 56 81
7 25 32 57 82
8 16 33 58 83
9 19 34 59 84
10 24 35 60 85
11 17 36 61 86
12 21 37 62 87
13 38 63 88
14 39 64 89
15 40 65 90
16 41 66 91
17 42 67 92
18 43 68 93
19 44 69 94
20 45 70 95
21 46 71 96
22 47 72 97
23 48 73 98
24 49 74 99
25 50 75 100

Click here to view the Results sheet.

 Worksheet
Solver - Time-Series Forecasting

3 -Period 5 -Period Weighted Moving Average Exponential Smoothing Trend-Adj. Exp. Smoothing
Moving Enter weights 0.50
Average Most recent 0.30 Initial Forecast 4 0.50
2rd most recent 0.30 Initial Average 0
3rd most recent 0.10 Note: The default for the Initial Initial Trend
4th most recent 0.10 forecast is set to the initial period's Note: The default for the Initial Average is set to the initial period's
5th most recent 0.20 actual demand but can be changed actual demand but can be changed above. The default for the
above. initial trend is set to 0 but can be changed above.

Error analysis begins in period 3

Actual Data 3-Period Moving Average 5-Period Weighted Moving Average Exponential Smoothing Trend-Adj. Exp. Smoothing
Period Forecast Error CFE Forecast Error CFE Forecast Error CFE Average Trend Forecast Error CFE Period Number
1 12 4.00 6.00 3.00 0.00 1
2 17 4.00 13.00 5.00 9.00 2
3 20 4.00 16.00 16.00 19.00 5.50 18.00 2.00 2.00 3
4 25 16.33 8.67 8.67 4.00 21.00 37.00 24.75 5.63 24.50 0.50 2.50 4
5 13 20.67 7.67 1.00 4.00 9.00 46.00 21.69 1.28 30.38 17.38 14.88 5
6 14 19.33 5.33 4.33 17.50 3.50 3.50 4.00 10.00 56.00 18.48 -0.96 22.97 8.97 23.84 6
7 25 17.33 7.67 3.33 16.00 9.00 5.50 4.00 21.00 77.00 21.26 0.91 17.52 7.48 16.37 7
8 16 17.33 1.33 2.00 19.50 3.50 2.00 4.00 12.00 89.00 19.08 -0.63 22.17 6.17 22.54 8
9 19 18.33 0.67 2.67 20.00 1.00 1.00 4.00 15.00 104.00 18.73 -0.50 18.45 0.55 21.99 9
10 24 20.00 4.00 6.67 17.00 7.00 8.00 4.00 20.00 124.00 21.11 0.95 18.23 5.77 16.22 10
11 17 19.67 2.67 4.00 19.80 2.80 5.20 4.00 13.00 137.00 19.53 -0.32 22.06 5.06 21.28 11
12 21 20.00 1.00 5.00 20.80 0.20 5.40 4.00 17.00 154.00 20.11 0.13 19.21 1.79 19.49 12
 Results
Solver - Time-Series Forecasting

Method 1 - Moving Average:

3 -Period Moving Average

Forecast for Period 13 20.67

CFE 5.00
MAD 4.33
MSE 27.49
MAPE 23.48%

Method 2 - Weighted Moving Average:

5 -Period Weighted Moving Average

Forecast for Period 13 6.30

CFE 5.40
MAD 3.86
MSE 23.34
MAPE 19.25%

Method 3 - Exponential Smoothing:

0.00
Initial Forecast 4.00

Forecast for Period 13 4.00

CFE 154.00
MAD 15.40
MSE 254.60
MAPE 78.34%

Method 4 - Trend-Adjusted Exponential Smoothing:

0.50
0.50
Initial Average 0.00
Initial Trend 0.00

Average for last period 20.11

Trend for last period 0.13

Forecast for Period 13 20.23

Forecast for Period 14 20.36
Forecast for Period 15 20.49
Forecast for Period 16 20.62
Forecast for Period 17 20.75
Forecast for Period 18 20.87

CFE 19.49
MAD 5.57
MSE 54.30
MAPE 34.34%
 ANDRES FAREZ 12/10/2016

Mes Observado PM3 PM5 Ponderaciones PM3 Ponderaciones PM5

1 12 0 0 Ultimo mes 0.3 Ultimo mes 0.3
2 17 0 0 Penultimo 0.3 Penultimo 0.3
3 20 0 0 Antepenultimo 0.4 Antepenultimo 0.1
4 25 17.5 0 Trasantepenultimo 0.1
5 13 21.9 0 Anterior 0.2
6 14 18 17.50
7 25 15.9 16.00
8 16 19.3 19.50
9 19 18.3 20.00
10 24 19.3 17.00
11 17 20.9 19.80 Proyecciones
12 21 19.5 20.80
30
25
20 Observado
PM3
Ventas 15
10 PM5

5
0
1 2 3 4 5 6 7 8 9 10 11 12

Meses