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Forecast
Forecast
Forecast
Symptom(s)
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You need to know the mathematical equations for the four Forecast Methods
used in Oracle Spares Management:
Simple Average
Weighted Average
Exponetial Smoothing
Trend Analysis
Change(s)
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Cause
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Need the mathematical equations that are used when calculating the four
Forecast Methods in Oracle Spares Mangement.
Fix
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The mathematical equations for the four Forecast Methods used in Oracle
Spares Management is as follows:
Simple Average
Weighted Average
Exponential Smoothing
and Previous forecast = the forecast produced at the end of previous period
and Trend = rate at which the forecast is increasing ( decreasing ) each period
and Previous Constant = Constant produced at the end of the previous period
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PURPOSE
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To provide a single document on how to create a forecast rule,
generate a statistical or focus forecast and define the methods
of forecasts available in 11i.
Before you can generate a focus or statistical forecast, you first define a forecast rule in Oracle Inventory.
Forecast rules define the bucket type, forecast method, and the sources of demand. If the rule is a statistical
forecast, the exponential smoothing factor (alpha), trend smoothing factor (beta), and seasonality
smoothing factor (gamma) are also part of the rule.
You can define forecast rules to establish the forecast method, bucket
type, and sources of demand that are considered when compiling
statistical or focused forecasts.
You can define forecast rules to use when loading forecasts. Defining
forecast rules includes choosing forecast source options, entering
statistical forecast parameters, and entering and adjusting initial
seasonality indices.
To define a forecast rule:
1. Navigate to the Forecast Rules window.
2. Enter a unique name for the rule.
3. Indicate whether the bucket type is days, weeks, or periods.
4. Determine the transaction types to use as demand sources. The
quantities associated with each source are used when calculating
historical usage:
Sales Order Shipments: Includes sales order issue quantities.
Issues to WIP: Includes WIP issue quantities.
Miscellaneous Issues: Includes quantities issued with user–defined
transaction sources, account numbers, and
account aliases.
Inter-Org Transfers: Includes quantities issued to other
organizations.
5. Indicate the forecast method to use:
Focus: Uses focus forecasting algorithms to forecast demand for the
item. This procedure tests the selected items against a number of
forecasting techniques and chooses the best one, based on history,
as the technique to forecast future demand.
Statistical: Uses exponential smoothing, trend, and seasonality
algorithms to forecast demand for the item
If you choose statistical forecasting, continue with the following
steps:
6. Enter the maximum number of past periods upon which to base
the forecast
7. Enter the factor by which to smooth demand for each successive
period in the forecast. This levels demand throughout the forecast,
reducing dramatic upward or downward fluctuations.
You can enter values from 0 to 1. Values closer to 0 give more
weight to past demand; values closer to 1 give more weight to
current demand.
8. Indicate whether to base the forecast on a trend model.
Turning this option on performs smoothing on the upward or
downward trend in demand.
9. Enter the factor by which to smooth the trend change in demand
from period to period. This produces a more linear rise or fall in
demand from period to period over the course of the forecast.
You can enter values from 0 to 1. Values closer to 1 give more
weight to recent changes and trends. Values closer to 0 give more
weight to historical trend.
10. Indicate whether to base the forecast on a seasonality model.
Turning this option on bases the forecast on a seasonal adjustments
you define for the forecast rule.
11. Enter the factor by which to smooth the seasonality indices you
define by period for this forecast rule. This produces a more even
pattern of seasonal demand from period to period over the course
of the forecast.
You can enter values from 0 to 1. Values closer to 0 give more
weight to past seasonal indices; values closer to 1 give more
weight to current seasonal indices.
12. Enter an index that describes the seasonal influence on the period.
For example, 2 indicates that you expect the forecast to double in
that period because of seasonal factors.
13. Save your work.
Same Source Only: Deletes the entries that have the same source as
those you load. You can replace entries on the forecast that were previously
loaded from the same source without affecting other entries on the
forecast.
There are four types of demand that you can place for your models,
option classes, options, and mandatory components:
independent forecast demand
exploded forecast demand
sales order demand
derived sales order demand
Sales order demand is demand that you place when your customers
order configurations. As your customers order configurations, Oracle
Order Management automatically places sales order demand for each
model, option class, and option selected by your customer when they
place the order.
If you place sales order demand for an item, but do not forecast the
item, set Forecast Control to None.
Summary
The following table summarizes, for each type of item, the types of
demand that Oracle Master Scheduling/MRP and Supply Chain
Planning assumes is placed for different values of Forecast Control.
Demand Type
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Item Type Forecast Forecast Exploded Sales Derived Sales
Control Forecast Orders Order
Option Consume X X
Consume/Derive X X X
Mandatory Consume X X
Component Consume/Derive X X X
Product Consume X X
Family Consume/Derive X