Home

Forecast Pro TRAC V2 User`s Guide

1. The green line on the graph represents the demand history for Total gt Muffins gt Stuff Mart The red line is the forecast and the blue lines are the confidence limits Move the cursor to a point on the graph hold the mouse very still and click the left mouse button Notice that the display now includes a vertical red line and a box listing the corresponding date and numeric values of the graph variables Customizing the Graph View 29 Click January 2012 the months are marked along the X axis Notice that the red line and box have moved to the new location Forecast Pro TRAC ProjectO2 0060500820002 00m0 00008 Stat Forecast Unlocked 1 gt though 2011 6 Unts Default F Project02 Graph Click the right mouse button to invoke the Graph view s context menu Select Data Only Notice that selecting Data Only turned off all of the forecast related components e g the forecasts and confidence limits Select Data Only a second time to turn the forecast related components back on Click the right mouse button to redisplay the context menu Notice that each individual graph component History Corrected History Forecast Confidence Limits Statistical Forecasts Fitted Values and Historic Intervals can be toggled on or off Select Graph Settings The Graph Settings dialog box allows you to customize your graph in numerous ways The Include tab allows you to toggle the forecast r
2. The Outliers tab is used to specify whether or not to detect and or correct outliers It also allows you to set the sensitivity settings for outlier detection and to dictate the amount of detail in the outlier report 220 Command Reference None turns outlier detection off The forecasts will be generated using the uncorrected history Detection only will detect outliers and display the suggested corrected values however the forecasts will be generated using the uncorrected history Detection and correction will detect outliers and will automatically use the corrected values when generating forecasts Sensitivity std deviations allows you to set the sensitivity of the outlier detection algorithm If a given fitted error exceeds this threshold and it is the largest error detected during the current iteration it will be flagged as an outlier Consult the Forecast Pro Statistical Reference Manual for details on how outlier detection and correction works Maximum iterations allows you to set the maximum number of iterations permitted during outlier detection for a given item This setting thereby also defines the maximum number of outliers than can be detected for a given item Consult the Forecast Pro Statistical Reference Manual for details on how outlier detection and correction works Include iteration statistics in reports allows you to include detailed statistics describing the outlier detection process in the outlier report
3. Examine Hot List Report xls in Excel and verify that it contains a worksheet for each item on the Hot List and that the contents and format matches the currently displayed graph and report views Close the Graph window and the Forecast Report window Open the Numeric Output Preview window by clicking the yellow Preview Numeric Output icon ED Saving the Forecasts 37 File Settings Operations Project View Window Help COGS SS S6S4GSESL 0VF4Y GOOOBS Stat Forecast Unlocked 2006 1 through 2011 gt 6 gt Holdout 0 ic Reset Units Defautt x 3 Total ra i Muffins 3 Stuff Mart a Muffins Stuff Mart COR 12 11 Point forecasts CASE 12 count Corn Muffins Defaut 6 544 79 845863 16 457 16 19 714 75 18 317 55 26 745 69 23 071 52 11 233 73 BRA 12 11 Muffins Stuff Mart BRA 12 11 Point forecasts CASE 12 count Bran Muffins Defaut 5 610 79 7 793 47 27 106 30 26 838 83 6 195 96 35 246 22 10 972 77 10 792 16 6 BLU 12 11 Muffins Stuff Mart BLU 12 11 Point forecasts CASE 12 count Blueberry Muffins Defaut 15 771 07 14 481 00 21 489 00 20 289 00 15 371 00 23 851 00 18 082 00 19 127 00 APP 12 11 z Muffins Stuff Mart APP 12 11 Point forecasts CASE 12 count Apple Muffins Defaut 5 527 30 5 624 48 7 475 70 7 313 81 7 703 24 9 825 67 7 068 69 7 292 36 OAT 12 11 Muffins Stuff Mart OAT 12 11 Point forecasts CASE 12 count Oatmeal Muffins Defaut 1 539 22 2 022 17 17 083 53 27 155 26 17 222 89 39 098 25 20 393 74 4 567 44
4. Report Styles Components Forecast Only V Expert Analysis Forecast Data Basic V Within Sample Statistics V Converted Forecasts Standard V Model Details V Safety Stocks You can either select one of the four standardized report styles or define a custom report Include graph in output can be used in conjunction with any style report and specifies whether to include or omit a graph when saving a formatted forecast report to Excel A description of each report style appears below Forecast Only is a minimal display consisting solely of the forecasts Basic displays a listing of the forecasting model used a set of the most commonly used within sample statistics and a forecast display including confidence limits and summary statistics Standard is the default display It includes the expert selection logic if applicable the model details including model coefficients a full set of within sample statistics a listing of detected corrected outliers if outlier detection is active a listing of any overrides and the same forecast display found in the Basic style Complete displays everything found in the Standard display as well as a numeric listing of the historic values fitted values converted forecasts safety stocks and an expanded forecast display Custom allows you complete control over what is included in the display Your selections under the Custom option are automatically retained for the project allowin
5. 0066 55 66 4066 0 ello OOO GS Units Dollars FJ Lesson 2 part 2 Override Report I Last Forecast Origin 2011 Jun 1 Hierarchy 1 2 3 4 Units Default Last Updated 5 5 2011 10 12 30 AM Total Muffins Stuff Mart COR 12 11 Saved 2011 Aug Demand Planning increased forecast to accomodate a planned promotion S S BLU 12 11 Saved 2011 Sep Demand Planning increased forecast to accomodate a planned promotion S S APP 12 11 E Saved 2011 Oct Demand Planning increased forecast to accomodate a planned promotion S S i OAT 12 11 ol uffins Stuff Mart APP 12 11 Saved 2011 Aug Demand Planning 624 forecast adjusted per customer s request SISK 5 Sids Club Saved 2011 Sep Demand Planning forecast adjusted per customer s request ssh COR 12 11 Saved 2011 Oct Demand Planning forecast adjusted per customer s request SS gt BRA 12 11 o uffns Sids Ciub BRA 12 11 Saved 2011 Aug Demand Pianning Increased forecast to accomodate a planned promotion S S t 7 senate Saved 2011 Sep Demand Planning Increased forecast to accomodate a planned promotion S S L e Grocery Land Saved 2011 Oct Demand Planning increased forecast to accomodate a planned promotion S S COR 12 11 Forecast Origin 2011 Jun 2 Hierarchy 1 2 3 4 Units Dollars Last Updated 5 23 2011 4 15 35 PM BLU 12 11 APP 12 11 3 Food Kin COR 12 11 BLU 12 11 CPN 421 529 214 472 252 325 naes Stuff Mart
6. Forecast Pro TRAC Exception Reports allow you to define either global or item specific thresholds to flag exceptions If you plan on using item specific thresholds you must define them in the secondary file You can include item level thresholds for both end items and groups When generating an Exception Report using item level thresholds if a given end item or group does not contain an item level threshold it will not be flagged as an exception Each Exception Report has its own specific item level thresholds field names The chart below documents the conventions 154 Setting Up Your Data Field Name FVH_MINP FVH_MAXP FVH_MIN FVH_MAX FR_MIN FR_MAX MAPE_MAX MAD_MAX FVA_MINP Exception Report Forecasts vs History Forecasts vs History Forecasts vs History Forecasts vs History Forecast Range Forecast Range Fitted MAPE Fitted MAD Forecasts vs Archive Description Defines item level lower threshold for allowable percent deviation of forecast value from historic value Defines item level upper threshold for allowable percent deviation of forecast value from historic value Defines item level lower threshold for allowable unit deviation of forecast value from historic value Defines item level upper threshold for allowable unit deviation of forecast value from historic value Defines 1tem level forecast range allowable minimum Defines item level forecast range allow
7. Not everyone understands the concept of forecasting It tends to get mixed up with goal setting If a company asks its salespeople to forecast sales for their territories these forecasts often become the yardsticks by which they are judged The main advantage of statistical forecasting is that it separates the process of forecasting from that of goal setting and makes it systematic and objective 11 Objective quantitative forecasting can help almost any business substantially There is in other words value added for business The future is uncertain and this uncertainty must be represented quantitatively Statistical forecasting represents uncertainty as a probability distribution Two kinds of information are needed to describe the distribution the point forecasts and the confidence limits A point forecast is the mean value of the distribution of future values and can be thought of as a best estimate of the future value Its upper and lower confidence limits describe the spread of the distribution above and below the point forecast Forecast Pro TRAC depicts this information graphically as well as numerically File Settings Operations Project View Window 0666 5566 4 066 4 0 4 4 0 000108 Stat Forecast Unlocked gt Holdout 0 SALES SALES Demand for business connections by month The upper confidence limit is often calibrated to the ninety fifth percentile This means that the actual value sh
8. Sids Club Muffins Sids Club COR 12 11 Point forecasts CASE 12 count Corn Muffins Defaut 7 050 28 7 050 28 7 050 28 7 050 28 7 050 28 7 050 28 7 050 28 7 050 28 COR 12 11 Muffins Sids Club BRA 12 11 Point forecasts CASE 12 count Bran Muffins Defaut 7 050 96 7 512 02 7 640 78 7 676 73 7 686 78 7 689 58 7 690 36 7 690 58 BRA 12 11 Muffins Sids Club BLU 12 11 Point forecasts CASE 12 count Blueberry Muffins Defaut 5 544 37 7 329 77 12 126 13 10 601 84 753 41 16 093 33 10 537 60 5 553 18 s A Muffins Sids Club APP 12 11 Point forecasts CASE 12 count Apple Muffins Defaut 5 318 17 7 949 04 12 597 32 11 086 70 5 662 80 14 653 59 19 547 83 8 590 81 bo Gidetan Muffins Grocery Land COR 12 11 Point forecasts CASE 12 count Corn Muffins Defaut 4 124 80 4 853 74 8 082 54 10 951 55 9 956 92 10 744 28 7 396 66 6 679 80 COR 12 11 Muffins Grocery Land BLU 12 11 Point forecasts CASE 12 count Blueberry Muffins Defaut 3 672 26 4 075 40 6 624 76 3 715 25 4 263 92 8 017 03 4 007 41 3 981 86 BLU 12 11 Muffins Grocery Land APP 12 11 Point forecasts CASE 12 count Apple Muffins Defaut 5 615 60 6 904 63 11 602 94 7 950 69 5 802 30 10 248 27 5 380 30 4 584 89 APP 12 11 Muffins Food King COR 12 11 Point forecasts CASE 12 count Corn Muffins Defaut 5 089 47 5 118 81 31 836 97 33 392 75 27 055 10 35 900 78 32 652 18 29 618 46 3 Food King Muffins Food King BLU 12 11 Point forecasts CASE 12 count Blueberry Muffins Defaut 15 231 36 14 087 88 25 164 64 15 974 99
9. to generate the forecasts Notice that the Graph view now includes forecast components and the Forecast Report view includes the forecasts and information about how they were generated Select Total gt Muffins gt Stuff Mart Notice that both views are immediately updated to match your current selection For this example we used expert selection to create the forecasts Expert selection can be thought of as an automatic pilot It analyzes your data statistically to determine the best forecasting technique to use and then proceeds to build the forecasts Expert selection begins by running a series of statistical tests on the data The results of these tests are run through a rule based logic system At times this logic system will directly select an appropriate forecasting method At other times the rule based logic will narrow down the potential forecasting methods that could be used without producing a clear winner In these instances expert selection will use an out of sample test to select between the competing models The Expert Analysis section of the Forecast Report documents how Forecast Pro TRAC makes its decision In our example the rule based logic was 26 The Basics inconclusive but narrowed down the choices to either an exponential smoothing model or a Box Jenkins model An out of sample test was then used to choose between these two candidates Notice that the expert system acts in much the same way as an expert s
10. Lesson 1 The Basics Before you can use Forecast Pro TRAC effectively you must learn some basic concepts This tutorial will guide you through these fundamentals The tutorial is divided into staged lessons You should complete them all to get a sound introduction to Forecast Pro TRAC This first lesson provides an overview of Forecast Pro TRAC and guides you through a sample forecasting session Before you can use Forecast Pro TRAC you must install it If you have not already done so follow the installation instructions discussed in Chapter 2 The Main Menu To start Forecast Pro TRAC click the Start button select All Programs and click the Forecast Pro TRAC icon After the program is loaded you will see a display like the one below 19 lt p Forecast Pro TRAC Project I I menu bar gt File Settings Operations Project View Window Help toolbar gt OGOGaos so ieag 2102 O C O O O h B dialog bar D _ Navigator Unavailable FJ Project0l Forecast Report Navigator gt lt Forecast Report window Hot List gt status bar gt The main window entitled Forecast Pro TRAC consists of a menu bar a toolbar a dialog bar a Navigator currently unavailable a Hot List area a Forecast Report window and a status bar The menu bar provides access to all procedures The most commonly used procedures can also be accessed instantly via the icons on the toolbar The dialog bar is current
11. You acknowledge that the Software and its structure organization and source code constitute valuable trade secrets of BFS You shall not nor shall permit assist or encourage any third party to e copy modify adapt alter translate reverse engineer decompile disassemble or attempt to derive the source code for the Software e merge the Software with other software and or create derivative works from the Software e sublicense distribute publish sell lease rent loan or otherwise transfer or allow access to the Software to any third party 254 Appendixes e use the Software in the operation of a service bureau e defeat disable or circumvent any security measures BFS may use to prevent unauthorized use or copying of the Software 5 TRANSFER OR REPRODUCTION You may not transfer or reproduce the Software with the exception of making a maximum of two 2 copies of the Software to be used for backup purposes only When using a Computer with a hard disk one copy of the Software may be installed on the hard disk provided that the copy is removed if the Software is used on another Computer 6 LIMITED WARRANTY THE SOFTWARE THE DOCUMENTATION AND ANY OTHER MATERIALS THAT MAY BY BE PROVIDED BY BFS ARE PROVIDED AS IS WITHOUT ANY WARRANTY OF ANY KIND BFS HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES WITH REGARD TO THE SOFTWARE THE DOCUMENTATION AND ANY OTHER MATERIALS WHETHER EXPRESS IMPLIED STATUTORY OR OTHERWISE I
12. 4 lt 1of2441 gt ro amp ilter Search E Datasheet View Num Lock jD EREA The above example does not use attribute fields to define product groupings This is often desirable and is discussed in the Using attribute fields to define a hierarchy section In our example each data record consists of six header items in columns 1 through 6 followed by the corresponding historic data point It is important to note that each data record must contain the aggregated value for the given period The fields are defined as follows ItemId0 This is a text field containing the variable name It can be up to 256 characters Description This is a text field containing the variable description It can be up to 256 characters Hist_Year This is a number field with field size double containing the year Hist_Period This is a number field with field size double containing the period Ppy This is a number field with field size double containing the periods per year 148 Setting Up Your Data Ppc This is a number field with field size double containing the periods per cycle Hist_Value This is a number field with field size double containing the aggregated historic data value for the record s date as defined by the Hist_ Year and Hist_ Period See the Overview section at the beginning of this chapter for more details on these items To connect to an ODBC database you set the data mode to ODBC in Settings an
13. Basic Formats Outliers Ovemides Command Line Pareto Analysis Advanced Controls Weighting Basis History Periods 12 Hierarchy level SKU 7 Forecasts Periods 1 to 12 t The Pareto Analysis tab allows you to specify how the ABC codes should be assigned History and Forecasts These settings allows you to indicate whether the ranking should be performed using the historic demand or the current forecasts and allows you to set the span for your selection 224 Command Reference Hierarchy level The ABC codes are assigned to a single level of the hierarchy The Hierarchy level drop down allows you to pick the level to use The Ranking Basis section allows you to set the thresholds for the classifications Volume This option allows you to set the codes based upon the cumulative volume of each group For example if A is set to 80 B is set to 15 and C 1s set to 5 Forecast Pro TRAC will first rank all of the items from highest volume to lowest volume and then sequentially place the top ranked items into the A group until their cumulative volume equals or exceeds 80 of the total volume It will then sequentially place items into the B group until the cumulative volume of the A and B items equals or exceeds 95 80 15 The remaining items 5 or less of the cumulative volume are assigned type C Series Count This option allows you to assign specific numbers of items to each group For example i
14. F 500 GroupA GroupB Si 72 3 F 200 F 300 ItemA1 ItemA2 ItemB1 ItemB2 S 1 S 1 S 1 S 2 O 75 F 125 F 100 F 200 F 75 Figure 5 Notice that 1 Forecast Pro TRAC used the Statistical forecasts for GroupA and GroupB to determine the allocation proportions NOT the previously committed Forecasts displayed in Figure 4 Using the committed Forecasts from Figure 4 would have resulted in a dramatically different allocation 2 Forecast Pro TRAC did not alter the committed Forecast value for ItemA 1 because it had been explicitly overridden When Forecast Pro TRAC 244 Understanding How Forecast Overrides are Allocated encounters an explicit override it considers the value locked and will not alter it This means that any needed allocations at a level containing locked forecasts will be made to the unlocked items only Let s now modify the above hierarchy by overriding the forecast for Item A2 to equal 75 This results in the hierarchy shown in Figure 6 below S 5 O 500 F 500 GroupA GroupB S 2 S 3 F 150 F 350 ItemA1 ItemA2 ItemB1 ItemB2 S 1 S 1 Ss S 2 O 75 O 75 F 116 667 F 233 333 F 75 F 75 Figure 6 Notice that normally the allocation of the 500 between GroupA and Group B would be based on the statistical forecast and result in forecasts of 200 and 300 respectively However we cannot change the GroupA forecast to 200 because it is locked at 150 due to the overrides on ItemA1 and It
15. Finance Ji ji Re i 76 050 121 529 214 472 252 325 212 850 426 985 268 091 130 536 164 338 142 504 76 281 100 253 s Total gt Muffins gt Grocery Land Formulas Percent 10 increment 2000 Value 76 050 Total gt gt Food L J j Total gt Cakes gt Stuff Mart Comment Converted forecasts Working with Override Sets 47 The report above displays two override sets The first one captures the overrides made to the initial default state Its header row identifies the forecast origin 1 e last historic data point as June of 2011 the hierarchy as 1 2 3 4 and the units as Default The second override set s header row identifies the forecast origin as June of 2011 the hierarchy as 1 2 3 4 and the units as Dollars Enter the value 400 000 into the September override cell on the Finance override row and click Commit Notice that the Override Report is updated to display your latest change The overrides and comments entered in every state 1 e hierarchy unit combination are saved to the database as an override set Override sets can be viewed in the Override Report imported and exported to projects and loaded from the database s archive when you update your project If possible it is a good practice to limit your overrides to a single state This allows you to view all overrides in place and vastly simplifies loading previously entered overrides when you update yo
16. Global thresholds use the same thresholds for all items The Comparison basis section allows you to set whether you want the thresholds to use percentages or units to set which historic point to compare the forecast with to base the comparison on either the final forecast which potentially includes user adjustments or the statistical forecast and to use either individual forecast points or the cumulative total for the specified range For example the settings shown above which include a History periods prior setting of 12 will compare the forecast with the historic period 12 months prior 1 e the same period last year The Layout section allows you to show all items on the Navigator on the report rather than only the ones that exceed the thresholds to include columns for the Pareto output and to include columns for custom filters af there are any defined 206 Command Reference The Forecast Range report compares the forecast to defined upper and lower bounds and flags any forecasts that fall outside of the defined range The Forecast periods to consider section allows you to set the number of forecast periods to monitor The Forecast extents to apply section allows to define the ranges Item level allows you to define different ranges to different items The item level ranges must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section
17. If this switch is on Forecast Pro TRAC s expert selection mode will not consider Box Jenkins models This will speed the forecast generation process considerably Exclude seasonal simplification If this switch is on Forecast Pro TRAC s expert selection mode will not consider seasonally simplified forms of exponential smoothing models If you are forecasting data where the number of periods per cycle is greater than 13 e g weekly data this will speed the forecast generation process considerably Automatic recalculation If this option is selected Forecast Pro TRAC will automatically recalculate the forecast and re reconcile the hierarchy every time you apply a forecast modifier For large hierarchies this can be time consuming If you turn this option off when you specify a forecast modifier the forecasts will not be updated until you click the red Forecast icon This allows you to specify multiple forecast modifiers without having to wait for the program to recalculate the forecasts in between each specification Display dates generically If this option is selected then monthly labels will be displayed using period numbers rather than the names of the months For example 2007 01 will be used rather than 2007 Jan This option is often used when working with a fiscal calendar where displaying the names of the months could be confusing 226 Command Reference Archive forecasts automatically If this option is selected For
18. Menu Items and Dialog Boxes This section covers all of the Forecast Pro TRAC menu items and their associated dialog boxes The File Menu The file menu is used to manipulate forecast project files save ODBC connections strings for use in command line operation print the currently displayed forecast report and to exit Forecast Pro TRAC File gt New is used to open a new forecast project This task can also be accomplished using the blue New Project icon File gt Open is used to open an existing forecast project This task can also be accomplished using the blue Open Project icon File gt Close is used to close the current forecast project File gt Save is used to save the current forecast project using the currently specified name This task can also be accomplished using the blue Save Project icon File gt Save as is used to save and name the current forecast project File gt Print is used to print the currently selected view File gt Print Preview is used to display the currently selected view formatted as it will be printed see File gt Print above Checking the appearance of the output prior to printing can save you trips to the printer File gt Print Setup is used to change various printing options File gt Exit is used to exit Forecast Pro TRAC The Settings Menu 216 Command Reference The settings menu provides access to the Options dialog box which allows you to change your project settings and to
19. Open the Graph view and double click on the first item listed on the outlier report Your display should now match the one shown below PJ Forecast Pro TRAC Projecto File Settings Operations Project Mi View Window Stat Forecast Unlocked a E through 2011 E6 Holdout 0 Total Muffins F Project09 Graph Stuff Mart COR 12 11 CASE 12 count Corn Muffins COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 5 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 3 Grocery Land m 2007 Jan 2008 Jan 2011 Jan 2012 Jan BB History HM Corrected History Forecasts WM Forecast Interval BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 COR 12 11 2009 Dec B Cakes APP 12 11 2010 Sep Stuff Mart Stuff Mart LF 20 02 2011 Jan VA 20 01 uke Grocery Land VA 20 01 2011 May Grocery Land CH 20 01 2008 Nov Grocery Land CA 20 01 2011 May ZZ Hier 1 2 3 4 Local Rea 124 Detecting and Correcting Outliers Notice that when you double clicked an item on the outlier report the Navigator jumps directly to that item Thus you can use the outlier report as the equivalent of a Hot List to navigate through the listed items All of the global report views yellow icon views support this kind of navigation Notice that the graph is displaying both the actual history for December 2009 and the suggested correcti
20. Stat Forecast Unlocked 1 through 2011 gt 6 gt Holdout 0 amp aolo Unts Defaut xj BOSS Total S Project03 Graph gt gt Bare 123 Bakery Inc Stuff Mart Customer COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 5 Grocery Land COR 12 11 2007 Jan 2009 Jan an 2011 Jan BLU 12 11 DINA E History E Forecasts MMB Forecast Interval Food King 7 COR 12 11 F Project03 Forecast Report fo e iis APP 12 11 Cakes E 3 Stuff Mart VA 20 01 ST 20 02 Customer Total gt Muffins gt Stuff Mart 7 Expert Analysis Total gt Muffins gt Stuff Mart Using rule based logic I have narrowed down the choice to exponential smoothing or Box Jenkins wil perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 9 265 and for Box Jenkins was 17 579 Total gt Cakes gt Grocery Land The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method Based on the lower MAD wil use Exponential Smoothing Arrange your display so that it includes both the Graph view and the Forecast Report view Right click on the Hot List to display its context menu and select Save Forecast Report A dialog box will appear allowing you to name the Excel file Name the file Hot List Report and save it
21. The Exception Report View 209 origin to use and to base the comparison on either the final forecast which potentially includes user adjustments or the statistical forecast The Layout section allows you to show all items on the Navigator on the report rather than only the ones that exceed the thresholds to include columns for the Pareto output and to include columns for custom filters af there are any defined pte en sera E Forecast Range Fitted Eror F sts vs Archive Waterfall Forecasts vs History Archive vs Actual Statistic and Threshold Analysis Mode Senes Analysis Minimum M dmum Avg emor Avg percent emor 100 The Waterfall report compares the cumulative statistics for the specified lead time from the current waterfall report to the specified thresholds The Analysis Mode drop down box allows you to specify which set of cumulative statistics to report Checking Statistical will base the comparison on the statistical forecast rather than the final forecast which potentially includes user adjustments The other options in the Statistic and Threshold section allow you to specify the lead time to monitor the statistic to use and set the thresholds If you select the Item level option the thresholds must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section of this manual The Layout section allows you to
22. ecn D gt Sel Home Insert Page Layout Formulas Data Review View Add Ins AbleBits com 9 2 o ow eg AE35 fe 2772 v ea eA B Cc D E F G H J K L MS 1 Total Category Customer SKU Description Starting Year Starting Period Periods Per Year Periods Per Cycle Jan 06 Feb 06 Mar 06 Ap 2 Muffins Stuff Mart COR 12 11 CASE 12 count Corn Muffins 1 12 12 3 BRA 12 11 CASE 12 count Bran Muffins 2006 1 12 12 20 829 72 576 11 016 4 BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 5 APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 6 763 7 661 9 561 6 6 OAT 12 11 CASE 12 count Oatmeal Muffins 2006 1 12 12 21 042 0 0 7 Sids Club COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 8 BRA 12 11 CASE 12 count Bran Muffins 2006 1 12 12 3 572 4 000 2 808 5 9 BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 15 307 1 866 3 477 6 10 APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 25 404 450 906 4 11 Grocery Land COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 12 BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 7 383 6 512 4 375 3 13 APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 21 729 13 780 9 072 6 14 Food King COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 15 BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 16 APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 17 Cakes Stuff Mart VA 20 01 CASE 20 oz Vanilla Layer Cake 2006 1 12 12 0 840 18 480 15 18 ST 20 02 CASE 20 oz Strawberry Pound Cake 2006 1 12 12
23. forecast Stuff Mart Showing forecasts VA 20 01 ST 20 02 Date 2011 Jan 2011 Feb 2011 Mar 2011 Apr 2011 May 2011 Jun Total gt Muffins gt Stuff Mart Origin Club Total gt Muffins gt Sids 2010 Dec 95 E 11 808 11 302 6 033 Total gt Muffins gt Grocery Land a f eae z S Total gt Muffins gt Food King 2011 Jan 12 697 6 837 9 726 Total gt Cakes gt Stuff Mart 2011 Feb S Total gt Cakes gt Grocery Land 2011 Mar 19 623 E 4 264 Total gt Cakes gt Food King 2011 Apr sa 37 j 6 994 2011 May 6 873 z a COR 12 11 CASE 12 count Corn Muffins Sz Hier 1 2 3 4 Local Due to its cascading like appearance the tracking report is sometimes referred to as a waterfall report The report compares what we forecasted to what actually happened therefore it is based on two key elements the actual demand history and archived forecasts for the periods being analyzed The actual demand history for the most current six months is shown in the first row with the green shading The next 6 rows display the forecasts generated for these periods from different forecast origins Thus the row labeled 2010 Dec displays the forecasts generated six months ago when the forecast origin was December 2010 and the first forecast period was January 2011 The row labeled 2011 May displays the forecast generated last month when the forecast origin was May 2011 and the first forecast period was June 2011 The wa
24. is currently displayed on the dialog bar s Units drop down box and that in the lower right hand corner of the status bar the default hierarchy is listed as 1 2 3 4 Locked and Unlocked Modes Changing the display units and or altering the hierarchy should only be done after you have established the statistical forecasts including any custom modeling options These operations will lock the statistical forecasts When the statistical forecasts are locked you are no longer able to change the statistical forecasting methods used to generate the statistical forecasts and the sections of the Forecast Report that pertain to the statistical modeling 1 e Expert Analysis Model Details Within Sample Statistics Out of Sample Tests and Outliers are omitted 42 Working with Conversions and Alternative Hierarchies Working with Alternative Units of Measure Forecast Pro TRAC allows you to define item level conversion factors 1 e multipliers which can be used to display the history and forecasts in alternative units Forecast Pro TRAC uses a second input file to bring in item level conversion factors and or exception report thresholds When Forecast Pro TRAC reads in a data file it looks for a corresponding secondary file The convention used to associate a secondary file with a data file 1s to use the same filename with Secondary appended to it In our current example the input filename is 723 Bakery xls and the correspond
25. is selected and that the adjusted R square is now 0 82 Right click on Product 1 to call up the Navigator s context menu Select Apply Modifier s To gt All Items Since the other four products all use the Adjusting for 4 vs 5 Week Periods 119 same calendar applying the weighting transformation improves the model in all cases Other Uses for Weighting Transformations The weighting transformation is useful in a wide variety of situations This section briefly notes some of them Its purpose is to indicate some directions you may want to take with your own business data Trading day corrections Many businesses are sensitive to the number of working days per period Consider a service provider who is closed on the weekends The number of working days in January and all other months will vary from year to year depending on how many weekend days happen to fall in any given month If the number of working days has an impact on sales then it needs to be accounted for in the model A simple solution would be to use a weighting transformation where the weights consist of the number of working days per month User defined seasonality At times you may wish to supply your own estimate of the seasonal pattern rather than trying to extract it directly from the data This might be desirable if the data were short or very noisy The weighting variable would consist of seasonal multipliers for the series Since the seasonality is being handled b
26. multiple level 168 overview 21 Seasonal indexes 97 Sensitivity outlier setting 221 Series Analysis display 202 Settings Options 217 Short lived products 106 Simple moving average 13 Speeding up the program 249 Spreadsheet data 139 140 SQLite 227 Starting Forecast Pro TRAC 19 Starting period 138 Starting year 138 Statistical row 198 Status bar 233 System requirements 7 Team Archive Link to 232 Open 232 Overview 235 Send to 232 Text file encoding 220 Thousands separator 219 Tile 234 Time Fence default length 222 Enable 229 Freeze Next Period 229 overview 236 Toolbar 187 233 Top down 103 TRAC files 161 Tracking report 164 200 Trailing zeros 219 Updates 235 Use SQLite 227 Variable 262 Index description 138 header information 138 name 138 Very simple models 178 View Apply Filters 234 View Modifiers 234 View Status bar 233 View Toolbar 233 Weekly data 95 Weighting transformation 181 Window Cascade 234 Window Tile 234 Winters 97 WK 139 140 WMAPE 202 203 XLS 139 140 Zeros 137 Zipped projects 162 250
27. project file We will then exit the program and execute the script via the command line Start Forecast Pro TRAC and select Settings gt Options Set the data mode to XIs the forecast horizon to 12 and then click on the Command Line tab 81 Basic _ Formats Outliers Ovemides Command Line Pareto Analysis Advanced Controls The Project Components to Apply section allows you to control how the forecasts are generated when the project is run from the command line If Modifiers is selected the project s forecast modifiers if any are present will be used to generate the forecasts in command line mode If this option is not selected all forecast modifiers in the project will be ignored when running from the command line If Overrides is selected the command line run will begin by reading in the data generating the statistical forecasts and then it will apply any matching overrides comments in the project to the new forecasts If this option is not selected all overrides in the project will be ignored when running from the command line If Settings is selected the command line run will use all of the settings associated with the project e g all settings in the Settings dialog box numeric output formatting etc If this option is not selected the default settings 1 e the settings that have been saved as the defaults for use with new projects will be used when running from the command line Th
28. 1 563 1 143 1 767 1 19 LF 20 02 CASE 20 oz Low Fat Pound Cake 2006 1 12 12 824 2 494 1 767 2 20 LE 20 02 CASE 20 oz Lemon Pound Cake 2006 1 12 12 1 351 1 975 1 767 3 21 CO 20 01 CASE 20 oz Coconut Layer Cake 2006 1 12 12 0 0 4 368 E 22 CH 20 01 CASE 20 oz Chocolate Layer Cake 2006 1 12 12 0 0 9 240 9 23 CA 20 01 CASE 20 oz Carrot Layer Cake 2006 1 12 12 0 0 14 280 11 24 BU 20 02 CASE 20 oz Butter Pound Cake 2006 1 12 12 5 715 1 035 2 595 5 25 Sids Club VA 20 01 CASE 20 oz Vanilla Layer Cake 2006 1 12 12 12 061 9 072 10 872 15 26 LF 20 02 CASE 20 oz Low Fat Pound Cake 2006 1 12 12 27 CO 20 01 CASE 20 oz Coconut Layer Cake 2006 1 12 12 20 196 12 672 18 144 24 28 CH 20 01 CASE 20 oz Chocolate Layer Cake 2006 1 12 12 29 CA 20 01 CASE 20 oz Carrot Layer Cake 2006 1 12 12 8 964 6 480 7 920 12 30 BU 20 02 CASE 20 oz Butter Pound Cake 2006 1 12 12 31 Grocery Land VA 20 01 CASE 20 oz Vanilla Layer Cake 2006 1 12 12 32 LF 20 02___ CASF 20 07 _I ow Fat Pound Cake 2006 1 1 1 1479 2 474 3771 1 M4r N Sheet1 lt j4 Pil Ready og 115 Forecast Pro TRAC will read spreadsheets formatted in this fashion properly ODBC attribute fields If you are using ODBC the first attribute field must be named ItemId0 the second attribute field must be named ItemId1 etc All attribute fields must be text fields Defining the Secondary File Forecast Pro TRAC uses a second input file table or query to bring in item leve
29. 111 12 gt Holdout 6 gt Res MAK044 778 575 MAKO045 71 MAKO46 oe MAK047 5 MAK048 Out of Sample Rolling Evaluation for Items in Group MAKO049 MAK050 MAKOS1 Hor N MAPEN MAD MAK052 1 408 408 762 07 ee 2 340 340 839 59 O NANS 3 2721272 1 065 74 dea 4 204 204 1 201 05 MAKO0S6 MAKOS7 SI1BI1 1 164 31 MAKOSS 6 68 68 1 499 67 MAKOS9 MAKO060 Out of Sample Static Evaluation MAKO61 MAK062 MAK063 MAK064 MAKO06S MAK066 Forecast AD MAD 920 895 56 932 457 91 11 562 35 11 562 35 870 151 55 852 988 42 17 163 13 14 362 74 826 847 72 876 756 39 49 908 66 26 211 38 MAKO67 A 844 151 74 868 048 62 23 896 88 25 632 76 778 574 58 803 670 82 25 096 24 25 525 45 828 235 95 883 766 35 55 530 40 30 526 28 jere are no overrides for this item Read SZ Hier 1 2 9 Local The tables display the following information Means are always taken over all the variables forecasted for a particular script line Hor is the forecast horizon N is the number of cases used to compute all statistics for this horizon other than the MAPE see below MAPE N is the number of cases used to compute the MAPEs for this horizon This can be less than the total number of forecasts for the horizon when some of the actuals are zero thus preventing computation of the MAPE MAD is the Mean Absolute Deviation for the horizon over all series on the current script line Cumulative MAD is the cumula
30. 13 081 02 25 727 71 10 680 95 15 668 70 COR 12 11 Muffins Food King APP 12 11 Point forecasts CASE 12 count Apple Muffins Defaut 16 285 30 16 285 30 16 285 30 16 285 30 16 285 30 16 285 30 16 285 30 16 285 30 BLU 12 11 Cakes Stuff Mart VA 20 01 Point forecasts CASE 20 oz Vanila Layer Cake Defaut 10 351 86 10 971 16 9 498 22 6 126 31 853963 10 141 75 7 134 37 5 267 31 gt APP 12 11 Cakes Stuff Mart ST 20 02 Point forecasts CASE 20 oz Strawberry Pound Cake Defaut 1 914 44 1 914 44 1 914 44 1 914 44 1914 44 1 914 44 1 914 44 1 914 44 a Cokes Cakes Stuff Mart LF 20 02 Point forecasts CASE 20 oz Low Fat Pound Cake Defaut 3 451 17 3 595 98 4 971 71 3 726 90 2949 66 459496 539488 3 613 00 7 Sa tl Cakes Stuff Mart LE 20 02 Point forecasts CASE 20 oz Lemon Pound Cake Defaut 3 150 59 3 362 40 3 879 73 2590 86 3 089 05 337883 3 162 30 2 866 00 ST 20 02 o Cakes Stuff Mart CO 20 01 Point forecasts CASE 20 oz Coconut Layer Cake Defaut 1 915 88 2 123 91 261013 1 915 88 2 193 25 224939 251396 1 709 51 Cakes Stuff Mart CH 20 01 Point forecasts CASE 20 oz Chocolate Layer Cake Defaut 13 502 79 15 238 44 13 324 07 10 984 03 12 494 45 14 223 63 11 451 83 9 475 05 Cakes Stuff Mat CA 20 01 Point forecasts CASE 20 oz Carrot Layer Cake Defaut 14 196 58 13 175 21 10 675 86 8 173 92 10 809 08 10 499 85 8 621 23 6 331 71 Total gt Muffins gt Stuff Mat Cakes Stuff Mart BU 20 02 Point forecasts CASE 20 oz Butter Pound Cake Defaut 5 213 17 4 882 29 7 28
31. 14143 12264 6565 8 628 3 Cakes 7 T T a T bok Finance VA 20 01 T t T T E F im 5 ji E i aani 6545 10459 18457 21715 18 318 36746 23072 11234 14143 12264 6565 6628 Total gt Muffins gt Stuff Mart Total gt Muffins gt Sids Club Total gt Muffins gt Grocery oe rupees Prana Swe Les Parone Formulas Percent 10 Increment 2000 Value 6 545 Demand Plann v Help Total es gt Sids Club Comment History Converted forecasts Total es gt Grocery Land es gt i The top window is displaying the Override Report view This view shows all current overrides in the project The Override Report view is turned on and off using the yellow View Override Report icon 4 Notice that this project is in the default state 1 e default units default hierarchy the statistical forecasts are unlocked and overrides exist for three of the SKUs The override view allows you to enter overrides and comments in specific cells on the override grid We refer to these overrides as appearing in place When you change units and or change the hierarchy it is not always possible to maintain the in place overrides This is due to factors such as the item or group that had an in place override may no longer exist after you change the hierarchy or that changing the units would result in a different forecast allocation across the hierarchy To avoid these problems and to insure that the final forecasts
32. 234 Hierarchy menu 191 Hot List 192 Icons 187 Import Archived Overrides 230 Import Modifiers 230 Import Overrides 230 Include group totals 220 Include iteration statistics 221 Incremental adjustments 222 Inherited Overrides row 199 Initialize Archive 228 Installation 32 bit 10 64 bit 10 automatic 9 Item Report 165 Item Report view 204 Leading zeros 219 License agreement 253 Main window 20 Manual reconciliation mode 222 Maximum iterations 221 M Competitions 127 Mdb files 162 Missing values 137 219 MLT 140 145 Modifiers 183 234 Multiple level forecasting 168 Navigator 190 Negative forecasts 218 New 216 Numeric Output Design 213 Numeric Output files 163 Numeric Output view 212 Numeric Precision 220 ODBC 140 147 ODBC Connect 227 Open 216 Operations Forecast 228 Operations ODBC Connect 227 Operations Read Data 228 Operations Script 228 Options dialog box 217 Outlier detection correction 182 221 Outlier Report 166 Outlier Report view 212 Outliers 99 Output directory 218 Override Report view 211 Override reports 165 Override view 198 Passwords 231 Percentage precision 220 Periods per cycle 139 Periods per year 139 Point forecast 12 Power transformation 184 Print Preview 216 Print Setup 216 Printing 216 Promotions 92 100 Read Data 228 Safety stock lead time 218 Save 216 Save as 216 Script 167 228 Index 261 defining 167
33. 66 408S4 0 4 4 0000196 Product 0 ANALOG PROFILE 1 500000 12 7 Project07 Graph L F Product 3 ANALOG PROFILE 1 500000 12 Product 3 Product launched 3 months ago a o y Ei E a Product 3 Raw hierarchy is Product 3 Model Details User Defined ANALOG _PROFILE 1 500000 12 ANALOG 621701 59 500000 12 2011 4 Forecasting by Analogy 113 The forecast shows the sales now required to achieve the specified launch total The fit shows the historic volume that would normally be associated with the current forecast The green line shows the actual sales to date which in this example is substantially lower than the fit Right click Product 3 on the Navigator to invoke the context menu and then select Model gt By Analogy to return to the By Analogy dialog box Remove the check mark from the Specified launch total option and click OK to build the model using the estimated launch total Examine the results and then exit Forecast Pro TRAC This ability to compare your specified launch totals with the estimated launch totals is quite powerful and will often illustrate the need to revisit your assumptions as the actual demand comes in Using the Bass Model In this exercise we ll create forecasts for a new product using the Bass diffusion model The Bass model is most often used to forecast first time purchases of new to world products The model tries to capture the adoption rates of two types of
34. 81 238 Compatible series 231 Component Analysis display 202 Component weights 201 Confidence limits 12 184 218 Control Panel 232 Convert to SQLite 229 Croston s model 13 CSV 139 140 Curve fitting modifiers 179 Data directory 217 Data files CSV 139 140 format 218 header information 138 MLT 140 145 path 217 selecting format 139 WK 139 140 XLS 139 140 Data length 15 136 260 Index Data mode 218 WKI1 column format 143 row format 141 XLS column format 143 row format 141 Data only 196 db files 161 Decimal separator 219 Default hierarchy only 214 Default units only 213 Detection and correction 221 Detection only 221 End item Analysis display 202 Event adjustment 105 Event models 14 91 180 Event variable 91 93 94 Excel 139 140 Exception reports 166 204 Exclude ARIMA 226 Exclude seasonal simplification 226 Exit 216 Exponential smoothing 14 modifiers 176 Fcb files 162 File Close 216 File Exit 216 File New 216 File Open 216 File Print 216 File Print Preview 216 File Print Setup 216 File Save 216 File Save as 216 Forecast by Analogy 14 Forecast command 228 Forecast file prefix 213 Forecast horizon 218 Forecast modifiers 175 Forecast projects 160 Forecast Report view 193 Forecast reports 163 FPProj files 161 FPZIP files 162 250 Generic dates 226 Graph settings 195 Graph view 195 Hardware requirements 7 Header 138 Help topics
35. BLU 12 11 APP 12 11 3 Cakes 3 Stuff Mart VA 20 01 ST 20 02 Total gt Muffins gt Stuff Mart Total gt Muffins gt Sids Joins Gess Side Cb 2006 Jan 2007 Jan 2008 Jan 2008 Jan 2010 Jan 2011 Jan 2012 Jan HB History MM Forecasts MMM Forecast Interval Read XX Hier 1 2 3 4 FP Local Saving the Forecasts Forecast Pro TRAC provides two different ways to output your forecasts Each is described below The Numeric Output file s is used to save the forecasts and other information in a concise format If you plan to import the forecasts into a database or a planning system this is the file you should use You have a great deal of control over the content and format of this file and can save it in text spreadsheet ODBC or XML formats The Forecast Report is an Excel file containing a separate forecast worksheet for each item forecasted Each report worksheet will contain the currently displayed graph for the item and the currently displayed forecast report Thus in addition to allowing you to view information on screen the graph view and the forecast report view also are used to design the Excel based forecast report Click Project gt Export Notice that both of these output files can be saved for either all items forecasted or just the items on the current Hot List 36 The Basics p Forecast Pro TRAC P oject03 File Settings Operations Project View Win 0666551664066
36. Category Product Description Jan 07 Feb 07 Mar 07 Apr 07 May 07 Jun 07 Jul 07 Aug 07 Sep 07 2 Total Camera yCamera Variable Format Camera 2007 1 12 12 6530 8260 8480 7430 5990 10980 5370 4570 10980 3 Total Camera iCamera Instant Camera 2007 1 12 12 6340 7951 7638 8187 5752 7692 3684 6087 957 4 Total Film vFormat_Film Variable Format Camera Film 2007 1 12 12 6642 9056 23053 13772 15064 26909 11357 12878 33584 5 Total Film iCamera_Film Instant Camera Film 2007 11212 37490 84035 168457 93379 110990 258906 52297 78972 262771 6 Total Film ASA100_BW 100 ASA Black amp White Film 200711212 56647 57211 87869 90175 79662 112503 80798 74108 89631 7 Total Film ASA100_Color 100 ASA Color Film 2007 11212 59484 58549 104973 80898 81580 136199 87090 98235 16708 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TOTAL PHOTO 4 The spreadsheet Presto Camera Company xls is shown above In this example we defined the groups Total Camera and Film directly in the spreadsheet using attribute fields columns A and B If we had included additional attribute fields we would have created a larger hierarchy Consult the Setting Up Your Data section of this manual for complete details 104 Building Multiple Level Models Combining Multiple Level and Event Adjustment Models In many cases the SKU s or product lines in a multiple level hierarchy are subject to promotional effects You can use the event model methodology described
37. Consult the Forecast Pro Statistical Reference Manual for details The other options in the Layout section allow you to include columns for the Pareto output and to include columns for custom filters if there are any defined The Overrides tab controls operation and display of the Override view Menu Items and Dialog Boxes 221 Adjustment mode If this selection is set to Override any overrides entered will replace the corresponding statistical forecasts or overrides entered on a preceding row If this switch is set to Incremental overrides you enter will be added as incremental adjustments to the statistical forecast rather than replacing it Thus the final forecast will equal the sum of the statistical forecast and all overrides entered If you attempt to change this setting when overrides exist for the current project you will receive a warning and all overrides will be erased Manual reconciliation mode If this switch is on the override window will include a Retain button as well as a Commit button The Retain button is used to accept overrides without reconciling the hierarchy This is useful when working with large complex hierarchies where the reconciliation process takes some time In manual reconciliation mode you would typically enter and retain all of the overrides you wish to make 1 e for multiple items and then click the Commit button to perform the reconciliation once rather than having to wai
38. Formulas Data Review View Add Ins 9x B Arial 10 o General 3 Inset E a7 ra gt ba 3 a B J UA A EZE H a 3 Delete g Fe a aste ERA Sr a ey Fes o in Flaa EE 50888 Format lt 27 Filter Select Clipboard Font E Alignment a Number Cells Editing B C E Variable Name PG1 204 1 PG1 204 2 PG1 204 3 PG1 203 4 PG1 203 5 Description 2 Bolt Anchors 4 Bolt Anchors 2 Staple Anchors 3 Staple Anchors 4 Staple Anchors Starting Year 2002 2002 Starting Period 11 11 Periods Per Year 12 12 Periods Per Cycle 12 12 Nov 02 Dec 02 Jan 03 Feb 03 Mar 03 Apr 03 May 03 t 4 gt gt Sheeti 3 2 3 4 5 6 T 8 9 The above example does not use attribute fields to define product groupings This is often desirable and is discussed in the Using attribute fields to define a hierarchy section Spreadsheet Formats 143 In our example each data record consists of six header items in rows 1 through 6 followed by the historic data in remainder of the rows beginning in row 7 Each item is placed in a separate cell Rows through 6 contain the following six required items Variable name Up to 256 characters Variable description Up to 256 characters Starting year Must be an integer Starting period Must be an integer Periods per year Must be an integer Nn A A W N e Periods per seasonal cycle Must be an integer See the Ov
39. Mart COR 12 11 CASE 12 count Com Muffins 2 BRA 12 11 Add to Hot List BLU 12 11 Model APP 12 11 ee OAT 12 11 3 Sids Club ee COR 12 11 Outliers BRA 12 11 Custom Modifier BLU 12 11 Remove Modifier s APP 12 11 3 Grocery Land Apply Modifier s To COR 12 11 BLU 12 11 APP 12 11 3 Food King coriz11 OPendAll ecast Report o o2 BLU 12 11 Collapse All for CORA2A1 APP 12 11 Expand All To Current Cakes 3 Stuff Mart VA 20 01 2008 Jan 2009 Jan 2010 Jan 2011 Jan 2012 Jan BS History E Forecasts HMB Forecast Interval Hierarchy Corn Muffins Stuff Mart gt COR 12 11 Raw hierarchy is Total gt Muffins gt Stuff Mart gt COR 12 11 Expert Analysis Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins s gt nery gt OAT 12 11 wil perform an out of sample test to select between these two approaches s gt Sids Gub al gt gt Sids Gub gt COR 12 11 Muffins gt Sids Qub gt BRA 12 11 The cumulative MAD for Exponential smoothing was 3 037 and for Box Jenkins was 3 097 Total gt Muffins gt Sids Club gt BLU 12 11 gt ms gt Total gt Muffins gt Sids Club gt APP 12 11 The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method Rea Hier 1 2 3 4 _ 9 Local The Navigator s context menu provides a convenient way to build a Hot List apply forecast
40. Notice also the confidence limits are set equal to the forecasts The first forecast period is established by the script as a whole in this example July 2011 One option is to use the override facility to enter the desired forecast in the form of an override Another option is to use the fixed forecast value model This model allows you to set the statistical forecast to a specific value Right click Product 0 on the Navigator to invoke the context menu and then select Model gt Very Simple Models gt Fixed Forecast Value A dialog box will appear allowing you to specify the value Set the value to 500 and click OK Examine the Graph and Forecast Report views to verify that the forecast is now set to 500 A related modeling option to Fixed Forecast Value is Fixed Value After This option is used when you wish to set the statistical forecast to a specific value 110 New Product Forecasting after a specific point in time This can be useful when you are discontinuing a product and wish to set the forecast to zero part way through the forecast horizon or for a new product that won t come on line until part way through the forecast horizon For our example let s suppose that Product 0 will not come on line until October 2011 We d therefore like the forecast to be zero until September 2011 and 500 units per month thereafter To accomplish this we must first remove the Fixed Forecast Value setting Right click Product 0 on the N
41. Pareto Classifications Within Forecast Pro Start Forecast Pro TRAC select File gt Open and open the project Lesson 5 This project contains forecasts for the muffins and cakes data that we worked with in previous lessons 65 Click the light blue Options icon to invoke the Options dialog box and then select the Pareto Analysis tab Basic _ Formats Outliers Overides Command Line Pareto Analysis Advanced Controls The Pareto Analysis tab allows you to specify how the ABC codes should be assigned The Weighting Basis section allows you to indicate whether the ranking should be performed using the history forecasts or a combination of the two and allows you to set the span for your selection The codes are assigned to a single level of the hierarchy The Hierarchy level drop down allows you to pick the level to use The Ranking Basis section allows you to set the thresholds for the classifications The Volume option allows you to set the codes based upon the cumulative volume of each group For example if A is set to 80 B is set to 15 and C 1s set to 5 Forecast Pro TRAC will first rank all of the items from highest volume to lowest volume and then sequentially place the top ranked items into the A group until their cumulative volume equals or exceeds 80 of the total volume It will then sequentially place items into the B group until the cumulative volume of the A and B items equals or exceeds 95 80 1
42. Total gt Muffins gt Sids Club gt APP 12 11 Rea Project03 Forecast Report dow Help gt through 2011 gt 6 gt Holdout 0 Units Defaut ZJ Projecto3 Graph 7 koles COR 12 11 CASE 12 count Corn Muffins ea A NEE E eaten ae aC Ie EL TRS la EAEN E E ca ct a aici al a aS aa ater ca i ne cas ES ANE ee Se Ee eo eee Le aaaunenesdoseneneunnsaed N Style SOONE PEREN EEE E E EEEE EEEE PE O Display RPR E O OTER A POSI IEI EAERI AIET A RIETI ITA ORISII EE h PE CPIE TEA n Graph Settings i Zoom Xi FEO a lt lt lt VANS SAA A ta Only oe 2008 Jan Aes 2010 Jan 2011 Jan 2012 Jan E Histo E Forecasts E Forecast Interval orrected History vV Forecast f Limi Forecast Report for COR 12 11 Yi eee Stat Forecasts CASE 12 count Corn Muffins Fitted Total gt Muffins gt Stuff Mart gt COR 12 11 Hist Interval Copy Image Raw hierarchy is Total gt Muffins gt Stuff Mart gt AE Expert Analysis Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins will perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 3 037 and for Box Jenkins was 3 097 The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method The Graph Settings dialog box allows you to customize the Graph view This dialog box is invoked by selecting Settings
43. WF_MPE_ MAX WF_MAPE MAX WF_MAD_MAX Waterfall Waterfall Waterfall Waterfall Waterfall Waterfall Waterfall threshold for allowable average forecast Defines item level upper threshold for allowable average forecast Defines item level lower threshold for allowable average forecast error Defines item level upper threshold for allowable average forecast error Defines item level lower threshold for allowable mean percent forecast error Defines item level upper threshold for allowable mean percent forecast error Defines threshold for allowable MAPE Defines threshold for allowable MAD Defining the Secondary File 157 Chapter 2 Saving Your Work Forecast Pro TRAC can save eight different types of output Forecast Projects allow you to save your forecasting session so that you can return later and pick up where you left off or to share the session with others The forecast project saves the data forecasts overrides Hot List modifiers etc as they currently exist in memory If you update your input data files after saving a project when you reopen the project you ll have the option of either generating new forecasts using the updated data or restoring the conditions present when the project was saved 1 e not recalculating the forecasts using the new data Numeric Output Files can contain time series output such as history forecasts fitted values and confidence limits as well as sta
44. a graph of MintyFresh24 Cone File Settings Operations Project View Window Help BE O A p oa 6606 556 6464 0 6 4 2 OGOS BS 2007 1 gt through 2011 9 Holdout 0 5 Units Stat Forecast Unlocked MintyFresh24 24 ounce bottle of MintyFresh Mouthwash Raw hierarchy is Total gt MintyFresh24 Are forecast is pending for MintyFresh24 MintyFresh24 represents monthly sales of a nationally advertised brand of mouthwash in a certain size package The prominent peaks on the graph are not due to seasonal patterns they are the result of price promotions Select MintyFresh32 on the Navigator This series represents sales of the same product in a different size package _PriceSpecials is an event variable we will discuss this variable shortly 92 Building Event Models Let s begin by modeling MintyFresh24 and MintyFresh32 using expert selection Click the red Forecast icon When the calculations are complete view the forecast report for MintyFresh24 Notice that a nontrended additive seasonality exponential smoothing is selected and that the adjusted R square 1s 0 50 Exponential smoothing recognized the effects of the promotions as a form of irregular seasonality The forecasts from such a model tend to repeat the promotional pattern of the last year of historic data If as is usually the case your future promotions are patterned differently the forecasts may b
45. adjusted the GroupB forecast to 75 rather than ItemA1 we would generate Figure 3 242 Understanding How Forecast Overrides are Allocated F 77 GroupA GroupB S 2 S 3 F 2 O 75 F 75 ItemA1 ItemA2 ItemB1 ItemB2 S 1 S 1 S 1 S 72 F 1 F 1 F 25 F 50 Figure 3 Notice that the committed Forecasts for ItemB1 ItemB2 and Total do not equal the Statistical forecasts Notice also that Forecast Pro TRAC allocated the GroupB override to ItemB 1 and ItemB2 based on the proportions established by their Statistical forecasts Adjustments Made to More Than One Level In this section we will describe how Forecast Pro TRAC reconciles the forecast hierarchy when overrides are made to more than one level of the hierarchy Important There are many ways that this type of reconciliation could be performed each one leading to different forecasts If you plan to make overrides at more than one level of the hierarchy it is essential that you understand how Forecast Pro TRAC performs the reconciliation Figure 4 below depicts a forecast hierarchy where ItemA1 has been overridden to equal 75 It is identical to Figure 2 Adjustments Made to More Than One Level 243 F 79 GroupA GroupB S 2 S 3 F 76 F 3 ItemA1 ItemA2 ItemB 1 ItemB S 1 S 1 Ssl S 2 O 75 F 1 F 1 F 2 F 75 Figure 4 Let s now modify the above hierarchy by overriding the forecast for Total to equal 500 This results in the hierarchy shown in Figure 5 below Total S 5 O 500
46. and should not include blank spaces If you are not using attribute fields each variable name must be unique If you are using attribute fields each variable name within a given group must be unique Oracle Users Some Oracle drivers will only work if the Hist_Value field 1s defined as FLOAT not NUMBER All other numeric fields can be NUMBER with the decimal places set to zero Using Attribute Fields to Define a Hierarchy If you do not include any attribute fields when you read the data into Forecast Pro TRAC it will create a one level hierarchy i e there will be no group totals If your data file table or query includes attribute fields prior to the Variable Name field Forecast Pro TRAC will automatically build a multiple level hierarchy The first level of the hierarchy will correspond to the first attribute field the second level of the forecasting hierarchy will correspond to the second attribute field etc Let s illustrate this with an example The spreadsheet 23 Bakery xls is a sample data file shipped with Forecast Pro TRAC It is shown below 150 Setting Up Your Data 5 cd nn T 7 Baker Compatibility Mode Microsoh Excel Satta gt a Sam o Home Insert Page Layout Formulas Data Review View Add Ins AbleBits com 9 2 o wp es A043 fe 9072 v A B Cc D E F G H J K L Ti 1 Total Category Customer SKU Description Starting Year Starting Period Periods Per Year Periods Per Cycle Jan 06 Feb 06 Mar 06 Ap 2
47. are long lived The result is that seasonality is accounted for at the LINE level This is desirable when the SKU s are likely to have similar seasonal patterns but the data are too irregular for accurate estimation of seasonal indexes at the SKU level This concludes Lesson 11 Short Lived Products 107 Lesson 12 New Product Forecasting In this lesson you will explore different approaches to forecasting new products The lesson begins by examining some of the options available in Forecast Pro TRAC for generating forecasts prior to the product being launched 1 e when historic data are not yet available It then illustrates how to apply two forecasting methods designed specifically for forecasting new products forecasting by analogy and the Bass model Working With No Data Start the program click the red Script icon and select New Product Data Accept the script read in the data forecast the data open the graph view and fully expand the Navigator Your screen should now look like the one shown below 109 0506006440064 0 4 400006 Stat Forecast Unlocked 20 4 gt through 2011 Product 0 Product has not yet launched Raw hierarchy is Product 0 Item Product 0 is a new product Expert Analysis The time series consists of 0 data points I wil forecast 0 Notice that Product 0 has no demand history By default Forecast Pro TRAC will generate a forecast of zero for a time series with no history
48. current forecasts and others which monitor your archived forecasts To open the Exception Report view select View gt Exception Report or click the yellow Exception Report icon 204 Command Reference Fj Forecast Pro TRAC Lesson 7 EN LL C O File Settings Operations Project View Window Help 0665 55 66 4 0668 04 6 OOO 8S Stat Forecast Unlocked 2006 through 2011 Holdout 0 Units Default z Total amp Lesson Exception Report Forecasts vs History ae hates n Stat Forecast ie 50 00 2011 Jul COR 12 11 BRA 12 11 50 00 2011 Jul BLU 12 11 otal Muffins 12 50 00 2011 Jul APP 12 11 t ota akes 5 50 00 2011 Jul OAT 12 11 i ota akes 20 50 00 2011 Jul 3 Sids Club ol es uff Mart z 50 00 2011 Jul COR 12 11 ota akes 20 50 00 50 00 2011 Jul BRA 12 11 ol akes 20 01 50 00 2011 Jul BLU 12 11 50 00 2011 Jul APP 12 11 3 Grocery Land COR 12 11 BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 LF 20 02 Ready St Hier 1 2 3 4 __ Local All exception reports are displayed in a format similar to the example shown above A row is included for each exception found The initial columns identify the flagged item This is followed by either one or two columns displaying the thresholds that trigger an exception This is followed by a Date column identifying the exception period The next two columns display the value being mo
49. data and forecast peaks that correspond to the months indicated as promoted rather than the seasonal pattern 94 Building Event Models Select Apply Modifier s to on the Navigator s context menu and select All Items This will specify that the event model should be built for every item on the Navigator In this example this is appropriate since the same promotional schedule was used for both MintyFresh24 and MintyFresh32 If the two products had been promoted differently we would have created two separate event variables Business Forecast Systems has conducted extensive out of sample testing on event adjustment models This research demonstrates that event adjustment models nearly always yield a substantial real world benefit in forecast accuracy Modeling Weekly Data Select File gt New The program will ask you if you wish to save changes to the current project click No Click Settings gt Options set the forecast horizon to 52 and click OK In this exercise we will model weekly beer sales for a brand of beer in various types of packages Create a script containing the two lines Beer Beer Events Beer 3 Beer Events 3 3 c Wsers Public Documents Forecast Pro TRAC Input In the last example our event schedules were included directly in our data file In this example we ve elected to put the event variables in a separate file named Beer Events Maintaining your event schedules and or
50. data appear to have been modified since you last saved your roject Would you like to reforecast using the updated data Do not recalculate the forecast Recalculate the forecast and apply s V Modifiers V Ovenides vV Hot List z Forecast Pro TRAC has noticed that the forecast project Lesson 3 June 2011 and the data file 723 Bakery xls are out of sync It is giving you two options If you select Do not recalculate the forecast Forecast Pro TRAC will open the project and restore the forecasts session as it existed when it was saved last month t will not read the new data It will not revise the forecasts Select Do not recalculate the forecast and click OK to verify this Notice that the historic data ends in May of 2011 and the first forecast period is June 2011 Now select File gt Open and select the project Lesson 3 June 2011 again The data file and project are still out of sync so the dialog box reappears If we now select Recalculate the forecast and apply Forecast Pro TRAC will read in the revised data generate new forecasts and if you request them restore the project settings Hot List forecast modifiers and overrides Select Recalculate the forecast and apply and click OK Expand the Navigator and select Total gt Muffins gt Stuff Mart gt BRA 12 11 Notice that the historic data now ends in June 2011 and the first forecast period is July 2011 Notice also that Forecast Pro TRAC h
51. disk or to your database via ODBC The remaining sections of this chapter document this procedure as well as all other options in more detail The Forecast Pro TRAC Interface This section describes the Forecast Pro TRAC interface 186 Command Reference menu bar gt File Settings a View Window Help toolbar gt GCOoGSE CO 8S ACUE Dea amp O 5 38S dialog bar gt Stat Forecast Unlocked 2006 51 E through 2011 216 2 Hodou 0 Reset Unts Defaut 3 Total P eee Muffins L Stuff Mart Mar Apr COR 12 11 6 545 8 459 16 457 19 715 18 318 36 746 23 072 11 234 14 143 12 264 6565 8 628 lt override BRA 12 11 S fi ie S ee ees BLU 12 11 z 4 E Bi ai 4 window APP 12 11 i Forecast 6 545 8 459 16457 19715 18 318 36746 23072 11 234 14143 12 264 6565 8628 OAT 12 11 i Sids Club Navigator gt yee a AEA BRA 12 11 Formulas Percent 10 increment 1 gt Value 6 545 Override 1 X t Hep BLU 12 11 l APP 12 11 F Project03 Graph fol els Grocery Land rs aeecech COR 12 11 CASE 12 count Com Muffins BLU 12 11 lt graph APP 12 11 b Food King window COR 12 11 BLU 12 11 APP 12 11 eo 2910 5 2011 2012 5 a aes a MM Forecasts WB Forecast interval sai Ma VA 20 01 B F Project03 Forecast Report S lolx lt Forecast CASE 12 count Corn
52. forecast report file to Excel You have the option of saving this file Menu Items and Dialog Boxes 223 for all items forecasted or 1f you select Hot List only just for the items listed on the Hot List Keep in mind that these files can potentially be very large Waterfall Report If this option is selected the command line run will save a forecast tracking report file to Excel You have the option of saving this file for all items forecasted or if you select Hot List only just for the items listed on the Hot List Keep in mind that these files can potentially be very large Item report Outlier report Override report and Exception report If any of these options are selected the command line run will save the specified report s The format and contents including all items vs Hot List only will match the current settings in the project or the defaults if you ve specified to use them Project F PProj If this option is selected the command line run will update and save new project files Normally the only part of the project that will change during the command line run is the binary file fcb This is a snapshot file that allows you to open up the project without reading in the data and generating new forecasts Archive forecasts If this option is selected the command line run will update and save the TRAC database file You should select this option if you are archiving forecasts for tracking purposes ono _
53. gt D PES Poe D D o gt Lesson 5 Graph o amp ss 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Jan 2011 Jan BE History MM Forecasts MMM Forecast Interval Total Total SZ Hier 1 2 3 4 9 Local The Pareto field displays the assigned code The of Total field displays the percentage of total volume that the item represents The Ranking field is self explanatory The Cumulative field displays the percentage of total volume for the current item plus all higher ranked items Scroll through the display and examine the output Notice that the Cumulative for the item ranked 25 is the first one to exceed 80 and that therefore the item ranked 26 is classified as a B Click on the filter dropdown for Pareto column set the filter to only display type A and click OK Examine the filtered report Double click on the top ranked item on the report and then double click on the item ranked second Notice that the Navigator immediately jumps to the selected item The ability to sort filter and navigate by double clicking on items can be very convenient when reviewing your forecasts If you change units of measure or shuffle the hierarchy the Pareto information will automatically update Experiment with the Pareto and filtering options until you are comfortable with their operation When you are finished exit the program without saving changes to the Lesson 5 project 68 Pareto Analysis and Report Filtering Defining Paret
54. gt Graph Settings or by selecting Graph Settings from the Graph view s context menu The Settings dialog box contains four pages or tabs We will discuss each in turn Graph Settings Time Series Include Components Layout tems Data and Forecast Bements to Include Data only VI Historic values V Forecasts rected hist V Confidence limits Fitted values Statistical forecasts Historic interval The Graph View 195 The Include tab allows you to the select components to be displayed on the graph The components can also be toggled on or off using the Graph view s context menu Selecting Data only toggles off all of the active components with the exception of the history oS Cees i m The Components tab includes three sections The Display section allows you to select the graph type Time series displays a graph where the y axis covers both the historic and forecast period The All option will display the entire data set in a nonscrollable display If the All option is not selected the Periods option allows you to set how many periods should be included in a scrollable display Year over year displays a graph where the y axis is one year long and the data for each year are stacked on the display The Years option allows you to specify the number of years to include in the display Important note Because the two graph types are fundamentally different Forecast Pro TRAC maintains your settings
55. in Lesson 5 to account for such effects Example I A product line consisting of aggregated SKU s is promoted as a unit You believe that all the SKU s in the product line will be affected similarly You can deal with this by using the following approach LINE EVENT _PROMO TOPDOWN SKUI SKU2 SKU3 This causes Forecast Pro TRAC to execute the following procedure Forecast the group LINE taking promotions into account Forecast the SKU s without taking promotions into account Adjust the SKU forecasts so that they sum to the LINE forecasts This propagates the group level promotional effects to the SKU s Example 2 Now suppose that only one SKU of the group is promoted The following approach can account for this promotion LINE SKU 1 EVENT _PROMO SKU2 SKU3 This causes Forecast Pro TRAC to forecast the SKU s individually It then sums these forecasts to obtain forecasts for the group LINE What if you were to add the keyword TOPDOWN to the group LINE in this example The effect would be that the promotion of SKU1 affects it but does not affect overall sales at the group level This might be the case if the Combining Multiple Level and Event Adjustment Models 105 promotion affected sales only by cannibalizing other SKU s in the group This is a dubious effect It is usually better to prepare forecasts bottom up when there are distinct models for the lower level units Short Lived Products A manufacturer often maintains a
56. items that have no historic data If the switch is off items with no historic demand will be omitted and not appear on the Navigator Include group totals for data files If this switch is on Forecast Pro TRAC will automatically include a group total for each data file listed on the script Including or not including a group total for the data files will yield different hierarchies on the Navigator Text file encoding Specify the format to use when writing two byte characters to text files This option is only of relevance if your data or scripts utilize non ASCII characters Non Latin based languages such as Japanese Chinese Russian Arabic etc use non ASCII characters Code page Specify the Windows code page to use when text file encoding is set to multi byte The code page specifies the character set to use when writing a multi byte text file Most code pages are designed to support a specific language Display Precision Numeric Specify the precision 1 e number of decimal places to use when displaying time series data in the view windows Display Precision Percentage Specify the precision 1 e number of decimal places to use when displaying percentages in the view windows oc ms Basic Formats Outliers Ovemides Command Line Pareto Analysis Advanced Controls Detection and Correction Logic None Sensitivity std deviations Detection only Maximum iterations Detection and correction Layout
57. long files ODBC Open database connectivity ODBC allows Forecast Pro TRAC to read and write data directly to databases for which an ODBC driver exists Most popular databases support ODBC including Access Oracle and SQL server PROS ODBC can provide direct access to data stored in the corporate database obviating the need for intermediate files CONS Reading and writing directly to the corporate database can raise security issues Data transfer can be slow for some configurations The next three sections supply the details you need to set up your data in one of the Forecast Pro TRAC formats If you have chosen a format you need read only the pertinent section Spreadsheet Formats Forecast Pro TRAC can read Excel XLS XLSX files Lotus WK1 WK3 and WK4 files and CSV Comma Separated Values files saved from Excel You must create your spreadsheet file from within your spreadsheet program Forecast Pro TRAC checks data types as it reads the spreadsheet If it sees text where it expects a number or a floating point number where it expects an integer an error message will be displayed A blank cell is interpreted as a 140 Setting Up Your Data missing value Do not use zeros to represent missing values they will be interpreted as numbers and will probably distort your forecasts badly Entire spreadsheet vs named range You may either devote an entire worksheet to the data recommended or specify a portion of a worksh
58. macroeconomic and demographic sources Twenty forecasting methods were tested for the entire sample of 1001 time series and three on a subset of only 111 time series A sample of time points 6 for annual series 8 for quarterly 18 for monthly was held out from the end of each time series Each forecast model was fitted to the remaining data and used to forecast the values of the holdout sample The forecasts were then compared to the withheld data and errors computed for each horizon each time series and each forecast method The errors were then summarized and analyzed in a variety of ways 127 The most significant weakness in this methodology is that it uses only one forecast base for each time series the last point in the fitting sample One obtains only a snapshot of performance from one point in time A forecast base just before or after a dramatic event in the data may completely change the results Furthermore you obtain only one forecast error for each horizon time from 1 to the end of the fit set This procedure is referred to as a static evaluation Forecast Pro TRAC implements both a static and a rolling base evaluation The rolling base procedure begins in the same way However after the forecasts have been made the model is rolled forward by one period Forecasts are then made from the new base to the end of the withheld data This process is repeated until the withheld data sample is exhausted If 6 data points hav
59. models found on the Model context menu Forecast Pro TRAC supports a broad range of custom modeling modifiers These modifiers accommodate a wide range of modeling options including confidence limits percentiles safety stock lead times and power transformations Custom modifiers are entered using the Custom Modifier option on the Navigator s context menu Consult the Using Forecast Modifiers section to see a full list of the available modifiers The modifiers are also documented in the help system Experiment with the various modeling options until you are comfortable with their operation When you are finished exit the program This concludes Lesson 9 90 Using Forecast Modifiers Lesson 10 Building Event Models Event adjustment models extend exponential smoothing by allowing you to adjust for events like sales promotions strikes or simply for unexplained outliers You can adjust for events of several different types These could be promotions of different types or sizes or different calendar effects like Easter and Independence Day weeks Forecast Pro TRAC knows these occurrences simply as events of types 1 2 etc Event adjustment models work almost the same as seasonal index models In a seasonal index model each month gets its own index which is updated each time that month recurs In an event adjustment model each event type gets its own index which is updated each time an event of that particular type recurs The
60. modifiers control the display of the Navigator tree and rearrange the hierarchy Most of the options are self explanatory however a few warrant some explanation The options under Add to Hot List are used to copy items onto the current Hot List the Hot List is described in the next section Children Parents and Siblings refer to one level down on the current Navigator branch one level up on the current branch and the same level on the current branch respectively On the Analysis submenu Overrides refer to items with direct overrides and Affected refers to items with indirect overrides 1 e items where a direct override elsewhere in the hierarchy changed the item s forecast The Model Events Weights Outliers Top down and Indexes options are all used to specify forecast modifiers The most commonly used modifiers can be applied directly using the menu options The less commonly used modifiers can be entered from the keyboard using the Custom Modifier option A list of all supported modifiers and their function is found in the Using Forecast Modifiers chapter of this manual The Hierarchy option is used to shuffle rearrange the hierarchy displayed on the Navigator Reading data into Forecast Pro TRAC establishes the default hierarchy If the default hierarchy contains 4 levels the notation 1 2 3 4 is used to represent the default state Hierarchy gt Promote and The Forecast Pro TRAC Interface 191 Hierarchy gt Demote redef
61. more statistical 180 Using Forecast Modifiers details consult the section on exponential smoothing in the Forecast Pro Statistical Reference Manual The following modifiers are associated with event models Events gt Select EVENT _X Use an event model _X is the name of the time series containing the event schedule Model gt Exponential Smoothing gt Custom EXSM XYZ Use an exponential smoothing model with trend type X N no trend L linear trend D damped trend E exponential Forecast Pro decides seasonality type Y N nonseasonal M multiplicative seasonal A additive seasonal Forecast Pro decides and event type Z M multiplicative A additive Forecast Pro decides This modifier can only be used in conjunction with EVENT Model gt Exponential Smoothing gt Custom XYZ A B C D E Use an exponential smoothing model with trend type X N no trend L linear trend D damped trend E exponential Forecast Pro decides seasonality type Y N nonseasonal M multiplicative seasonal A additive seasonal Forecast Pro decides event type Z M multiplicative A additive Forecast Pro decides and user defined smoothing weights A level B trend C damping growth D seasonal E event This modifier can only be used in conjunction with EVENT The Weighting Transformation Modifier The weighting transformation is most commonly used to deseasonalize your variables using externally supplied seasonal weights or to no
62. of all time fences in the current project by one period for the current forecast origin If you subsequently update your data with the next observation and create a new forecast thus changing the forecast origin the time fence lengths will revert back to their pre Freeze Next Period settings This option provides a way of insuring that after the forecasts are finalized someone doesn t inadvertently alter the frozen periods forecasts prior to the data being updated new forecasts being generated and the frozen periods forecast becoming an officially fenced value Command line Operation You can run Forecast Pro TRAC noninteractively When the command line to execute the program includes a project filename FPProj and the b parameter Forecast Pro TRAC will read in the data create the forecasts save all output files and then exit This feature is particularly useful when you are integrating forecasting with other software systems and need a hands off approach To drive Forecast Pro TRAC entirely automatically follow these two steps 1 Prepare a valid project and place it in your project directory The easiest way to prepare this file is to use Forecast Pro TRAC interactively to define all desired project settings output formats a script and optionally forecast modifiers and overrides and then save the project using use File gt Save Alternatively you can generate the file externally but this will require understand
63. of this manual Setting Global Minimum and Maximum values defines the range for all items The Comparison basis section allows you to base the comparison on either the final forecast which potentially includes user adjustments or the statistical forecast The Layout section allows you to show all items on the Navigator on the report rather than only the ones outside of the range to include columns for the Pareto output and to include columns for custom filters if there are any defined a Archive vs Actual Forecasts vs Archive Waterfall Forecasts vs History Forecast Range Error Statistic and Threshold MAPE 100 gt Percent The Exception Report View 207 The Fitted Error report will flag as an exception any forecast model where the within sample MAPE or MAD exceeds the defined threshold The Statistic and Threshold section allows you to indicate whether you wish to monitor the MAPE or the MAD to set a global threshold to use or to specify that item level thresholds be used If you select the Item level option the thresholds must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section of this manual The Layout section allows you to show all items on the Navigator on the report rather than only the ones that exceed the thresholds to include columns for the Pareto output and to include columns for custom filters 1f ther
64. performance We recommend 2 Gigs if you are running a 32 bit operating system and as much RAM as your budget can afford if you are running a 64 bit operating system A hard disk drive with 30 MB of free space Checking Your Forecast Pro TRAC Package 7 Registering Your Forecast Pro TRAC Package Please take a moment NOW to fill out and mail the Registration Card you received with Forecast Pro TRAC or visit www forecastpro com and register on line Registering your software entitles you to the following benefits e Free maintenance and support service for one year This service provides program updates and unlimited technical support for the first year you license the program After the first year this service 1s available on a subscription basis Technical support is provided via the telephone during regular business hours Eastern Standard Time via email mail and fax e Automatic notification of upgrades revisions and new products e Special pricing on upgrades revisions and new products Future Development of Forecast Pro TRAC BFS has made many changes to Forecast Pro TRAC to accommodate special needs and circumstances in the corporate environment BFS will continue to improve Forecast Pro TRAC in the years to come If you encounter problems or have any suggestions for improvements or additional features please contact the BFS product development staff 8 Before You Begin Chapter 2 Installing Forecast Pro TRAC Autom
65. product line for a long period of time but frequently changes the SKU s that make up the line A laser printer manufacturer for instance often introduces new models and retires old ones The result may be that the overall product line can be accurately forecasted but the individual item histories are too short to support seasonal models In these instances the top down approach is particularly useful For instance assume that SKU1 and SKU2 have been phased out and replaced by SKU3 and SKU4 We also assume that at the end of the historic data only SKU3 and SKU4 are alive However the histories for SKU3 and SKU4 are too short to generate seasonal forecasts The manufacturer is interested in forecasting the group LINE SKU3 and SKU4 The approach below takes care of the problem LINE INDEXES SKUI SKU2 SKU3 SKU4 This causes Forecast Pro TRAC to follow the following procedure Forecast LINE obtaining seasonal indexes Use the LINE seasonal indexes to deseasonalize the SKU s Forecast the resulting nonseasonal SKU level data These nonseasonal models require very little data Use the LINE seasonal indexes to reseasonalize the SKU level forecasts 106 Building Multiple Level Models By default the LINE forecasts are then replaced by the summed SKU level forecasts If you do not want this to happen you can add the keyword YTOPDOWN to the group LINE The script presented in this example can also be used when the SKU level histories
66. project settings file The project settings file is an XML file containing the project settings and script definition Sample db SQLite or Sample TRAC Access is the primary Forecast Pro TRAC database This is either a SQLite or Microsoft Access database file that contains information pertaining to the current forecast period and all previously archived forecasts The 64 bit version of Forecast Pro TRAC will always use SQLite database files The 32 bit version can use either and you 58 Collaborating With Colleagues can specify which database file type to use on the Advanced tab of the Options dialog box The setting can only be changed on a new project prior to reading in the data Sample mdb is the project tables file The project tables file is a Microsoft Access database file containing separate tables for the in place overrides comments forecast modifiers and Hot List This file is only created when using Access database files Sample fcb is the project snapshot file The project snapshot file 1s a binary file that saves the forecast components that are currently in memory e g the forecasts summary Statistics etc so that the session can be restored without having to read in the data recalculate the forecasts etc This allows you to return to your session where you left off and to share the session with others When sharing projects with others you need to provide all the project files To illustrate how to share a projec
67. reconcile the forecasts By default a bottom up reconciliation will be performed this is the case in our current example That means that the group level forecasts will be generated by aggregating their component forecasts For example the forecast for the group Camera would be made by summing the forecasts of vVCamera and iCamera 102 Building Multiple Level Models An alternative is to use top down reconciliation Select Total gt Camera on the Navigator and right click to display the Navigator s context menu Select Top down Notice that the YTOPDOWN modifier now appears next to Camera UB Forcast Pro TRACE File Settings Operations Project View Window Heli 0006 00 66 4008S S 0e4 0 000 08 J4 Stat Forecast Unlocked 2007 1 though 2011 2 gt Holdout 0 Camera Product Category H Project06 Forecast Report oles Forecast Report for Camera Product Category Total gt Camera Expert Analysis Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins will perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 4 633 and for Box Jenkins was 4 548 The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method Based on the lower MAD will use Box Jenkins The TOPDOWN group modifier instructs the program to adjust lower level forecasts to sum up to the indic
68. s context menu 166 Saving Your Work Chapter 3 Working with Scripts and Hierarchies The script 1s a list of the data files to be forecasted Together the script and the data files define the hierarchy that will appear in the Navigator when you read the data into Forecast Pro TRAC This chapter explains how to define scripts and also discusses the strategies that Forecast Pro TRAC uses to produce consistent forecasts for hierarchical data Defining the Script The information contained in the script is recorded in the current forecast project In the case of a new forecast project the script is initially blank If you open an existing forecast project the script is the same as when the project was saved The Define Script dialog box pictured below is accessed by clicking on the red Script icon or by selecting Operations gt Script 167 cnc it _ 123 Bakery eer xis c Wsers Public Documents Forecast Pro TRAC nput Browse The dialog box consists of the script area and the data list box You can use the vertical scroll bar to see other lines of the script The data list box displays the currently available data files or ODBC tables If you double click a filename or table name in the box the text is transferred to the currently selected script line Defining the Hierarchy Product data can almost always be organized into several levels of aggregation Suppose that an SKU Stock Keeping U
69. set up your own data please consult Chapter 1 of Part 4 Reference Statistical Reference Manual PDF only The Forecast Pro Statistical Reference Manual describes the statistical techniques statistics and strategies that are implemented in Forecast Pro It is not necessary that you fully understand or even read this manual in order to produce accurate forecasts with the product The manual is provided in electronic format pdf When Forecast Pro TRAC is installed the file 1s copied into the program directory You can access the file directly or via the Help menu in Forecast Pro TRAC Chapter l is a detailed statistical reference It explains the theory behind Forecast Pro TRAC s statistical models diagnostics and methodology Chapter 2 is a discussion of some of the general considerations that apply to automatic batch forecasting 6 Before You Begin Checking Your Forecast Pro TRAC Package Your Forecast Pro TRAC package should contain the following items This User s Manual This book walks you through the installation and use of Forecast Pro TRAC One installation CD A warranty registration card A maintenance and support contract If your package is missing any of the above items please contact Business Forecast Systems Inc What You Need to Run Forecast Pro TRAC A computer running a Windows operating system A minimum of 512 MB of random access memory RAM Additional memory will greatly enhance program
70. sets currently being displayed The Apply button can be used to load specific override sets one at a time In our example Apply all sets would load the first set which was made in base state then convert to dollars and load the second set Since converting to dollars requires locking the forecasts 1f you select Apply all sets in our current example you will be in locked mode after the overrides are loaded Let s say that our forecasting process calls for the forecaster to update the Statistical forecasts enter overrides in base state and then save the revised project which then goes to finance who converts to dollars and makes additional changes If this was our process and we were the forecaster we d probably want to begin by restoring the override set we saved last forecast period Click on the first override set to select it Click Apply to load the override set Click Exit to exit the Import Archived Overrides dialog box Notice that the overrides have been loaded and that since these overrides were made in base State the statistical forecasts are unlocked 54 Updating a Forecast Project As you can see updating your forecasts becomes considerably more complex when there are multiple override sets involved For this reason we recommend that you create a forecast process that uses as few override sets as possible Ideally you d limit your overrides to a single state This allows you to view all overrides in pla
71. show all items on the Navigator on the report rather than only the ones that exceed the thresholds to include columns for the Pareto output and to include columns for custom filters 1f there are any defined When using the Show all option the report will display all statistics included in the selected Analysis Mode rather than just the specified threshold statistic 210 Command Reference The Override Report View The Override Report view lists items where overrides and or comments have been made The display is useful when reviewing the current overrides and also when loading archived override sets To open the Override Report view select View gt Override Report or click the yellow View Override Report icon PA If you double click an item on the Override Report the Navigator will jump directly to that item Thus you can use the Override Report as the equivalent of a Hot List to navigate through the listed items All of the global report views yellow icon views support this kind of navigation The content and format of the report is controlled using the Override Report Design dialog box This dialog box is invoked by selecting Settings gt Override Report Design or by selecting Override Report Design from the Override Report view s context menu The Display section allows you to control the override sets that will be displayed to include columns for the Pareto output and to include columns for custom filters 1f th
72. specify alternative reconciliation approaches These modifiers can only be used on group level data Top down TOPDOWN directs Forecast Pro TRAC to perform top down reconciliation for all members of the indicated group This procedure begins by preparing forecasts for each and every group and item Then it proportionally adjusts the nested lower level items and groups forecasts to sum to the TOPDOWN group forecast If the YTOPDOWN group is itself nested within larger groups the forecasts for the larger groups are computed using a bottom up approach Indexes INDEXES directs Forecast Pro TRAC to calculate the seasonal indexes at the indicated group level and use them to deseasonalize the histories for the nested items and groups The deseasonalized series are then forecasted and as a final step reseasonalized This approach works well when the items share the same seasonality It allows one to deal with items whose histories are too short to extract seasonality directly You cannot nest INDEXES groups within each other Model parameters are reestimated for each item of the INDEXES group Reconciliation Modifiers 183 Miscellaneous Custom Modifiers The modifiers listed below can be entered from the keyboard via Custom Modifier on the Navigator s context menu Custom Modifier LOWER Set the lower confidence limit equal to the value L must be between 0 1 and 50 0 inclusive Custom Modifier UPPER u Set the upper confiden
73. statistical forecast The Lead time and Archive period settings are only relevant if you are monitoring more than one historic point They allow you to compare each historic point being monitored to either the corresponding forecast for a specific lead time or to forecasts made at a specific archive period 1 e forecast origin The Layout section allows you to show all items on the Navigator on the report rather than only the ones that exceed the thresholds to include columns for the Pareto output and to include columns for custom filters af there are any defined The Forecasts vs Archive report compares the current forecast to an archived forecast for the same period and flags any cases where the change exceeds the thresholds The Forecast periods to consider section allows you to set the number of forecast periods to monitor The Allowable deviation from archived forecasts section allows you to set the sensitivity of the exception thresholds Item level thresholds allow you to assign different sensitivities to different items The item level thresholds must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section of this manual Global thresholds use the same thresholds for all items The Comparison basis section allows you to set whether you want the thresholds to use percent or units to specify an archive period 1 e forecast
74. the one defined in the historic data file the status bar lists the hierarchy as 1 2 3 4 Select Total gt Muffins gt Stuff Mart on the Navigator This displays the total muffin sales for Stuff Mart The children 1 e component series of this group are the SKU level muffin sales to Stuff Mart What if we wanted to view or adjust total sales for a given SKU across customers The current hierarchy is not set up to do this To accomplish this we need to reorganize our hierarchy so that the SKUs appear on level 3 of the hierarchy and the customers appear on level 4 Right click Total gt Muffins gt Stuff Mart on the Navigator to invoke the context menu Select Hierarchy gt Demote Fully expand the Navigator and select BU 20 02 Your display should look like the one below 44 Working with Conversions and Alternative Hierarchies File Settings Operations Project View Window Hel 000550664 06G4 0 44 000008 Unts Default X s a Fh Lesson 2 part 1 Forecast overrides axes 5 20 02 sep oct Nov Dec mar Apr may Food King 27 060 26 914 30 509 23 126 25 239 28 729 20 791 25 762 31 133 Grocery Land i 1 l 4 Sids Club J Stuff Mart 1 L CA 20 01 Food King 27 060 26914 30509 23126 25 239 28729 21997 25857 37 198 20791 25762 31133 Grocery Land Sids Club Stuff Mart m u E m CH 20
75. the override could not be made and Forecast Pro TRAC would display an error message and reject the override 246 Understanding How Forecast Overrides are Allocated Summation It should be quite apparent that if you make adjustments to more than one level of a hierarchy the reconciliation becomes quite complex Although several of the examples presented seemed involved they were actually quite simple hierarchies consisting of only 3 levels and 4 end items Most users of Forecast Pro TRAC are working with thousands of items and much more complex hierarchies In developing the reconciliation routine for Forecast Pro TRAC the authors considered using several different algorithms In many situations the choice of which algorithm to use would change the forecast values sometimes significantly None of the algorithms were statistically superior to the others they were simply different Virtually all of the complexity and differences between algorithms disappears if you restrict yourself to making forecast adjustments to a single level of the hierarchy Although we ve stated this previously it s worth repeating If you restrict your overrides to a single level of the hierarchy the reconciliation process is simple and intuitive We strongly urge you to limit your overrides to a single level if at all possible Summation 247 Appendixes Speeding Up the Program If decreasing processing time is important for your applicati
76. trend E exponential Forecast Pro decides seasonality type Y N nonseasonal M multiplicative seasonal A additive seasonal Forecast Pro decides and user defined smoothing weights A level B trend C damping growth D seasonal Model gt Exponential Smoothing gt Custom SS Use Forecast Pro s automatic identification procedure to determine whether to use seasonal simplification and the appropriate bucket size Model gt Exponential Smoothing gt Custom SS n Use seasonal simplification with bucket size equals n Box Jenkins Model gt Box Jenkins gt Auto B Use the automatic fitting Box Jenkins model Box lrkns Mode Sting O O Model Type Conca Heb Model gt Box Jenkins gt Custom 4RIMA p d q Use a non seasonal Box Jenkins model with model orders p d and q Model gt Box Jenkins gt Custom ARIMA p d q P D Q Use a seasonal Box Jenkins model with model orders p d q P D and Q Model gt Box Jenkins gt Custom CONST Include a constant intercept in the Box Jenkins model Discrete Data Model gt Discrete DISCRETE Use a simple exponential smoothing model and base confidence limits on one of the discrete distributions Poisson or Model Specification Modifiers 177 negative binomial This option is used to obtain better estimates of the confidence limits for low volume integer series typically with many zeros Intermittent Data Model gt Intermittent VNTER Use the Croston s intermi
77. weighting variables discussed in Lesson 11 in a separate file from the historic data is often convenient For instance if your IT department generates the historic data files for you each forecast period keeping the event schedules in a Modeling Weekly Data 95 separate file allows you to edit and maintain them without the assistance of the IT department Read in the data create the forecasts expand the Navigator and graph C 6 C 6 represents sales of beer in cans packaged in 6 packs p Forecast Pro TRAC Pr ject06 Oje File Settings Operations Project View Window Heli p a 7 Vat j aXe AA COCA AEE CAA Stat Forecast Unlocked 2005 1 gt through 2011 34 Holdout 0 lt Units 3 Cans c C 12 C 6 6 Packs 12 Ounce Cans _Helpers gt _HOLIDAYS gt P amp H 2008 01 2009 01 010 01 l 011 01 BE History MM Forecasts WH Forecast Interval 6 Packs 12 Ounce Cans Cans gt C 6 Raw hierarchy is Cans gt C 6 Expert Analysis Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins wil perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 62 and for Box Jenkins was 85 The rolling out of sample test used a maximum horizon of 52 and generated 1378 forecas ts for each method In order to get a better view of the data turn off the Forecast Report window Right click the Grap
78. 0 eH 6 OOO 46 Stat Forecast Unlocked 1 H tough 2011 216 Hodo O Units Defaut 3 Total Lesson 3 part 2 Override Report Muffins 3 Stuff Mart COR 12 11 Forecast Origin 2011 May 1 Hierarchy 1 2 3 4 Units Default Last Updated 5 6 2011 10 09 08 AM BRA 12 11 Total Muffins Stuff Mart BRA 12 11 Saved 2011 Jul Override 1 6 875 increased for a planned promotion 5 6 2011 10 08 46 AM BLU 12 11 a ota Muffins Stuff Mart BRA 12 11 Saved 2011 Aug Override 1 9 375 increased for a planned promotion 5 6 2011 10 08 46 AM APP 12 11 o Muffins Stuff Mat BRA 12 11 Saved 2011 Sep Override 1 31 511 eased for a planned promotion 5 6 2011 10 08 46 AM OAT 12 11 ol Muffins Sids Club BRA 12 11 Saved 2011 Jul Override 1 8 464 eased for a planned promotion 5 6 2011 10 09 07 AM 3 Sids Club ol Muffins Sids Cub BRA 12 11 Saved 2011 Aug Override 1 8 770 n 56 2011 10 09 07 AM COR 12 11 o Muffins Sids Club BRA 12 11 Saved 2011 Sep Override1 3 8 853 eased for a planned promotion 5 6 2011 10 09 07 AM gt BRA 12 11 Forecast Origin 2011 May 2 Hierarchy 1 2 3 4 Units Dollars Last Updated 5 6 2011 10 10 16 AM seie Total Muffins Stuff Mart BRA 12 11 Saved 2011 Aug Overrde2 4 120 000 Raised the forecast to 120K 5 6 2011 10 09 59 AM gt 12 Grocery Land Total Muffins Sids Club BRA 12 11 Saved 2011 Aug Overrde2 4 i 120 000 Raised the forecast to 120K 5 6 2011 10 10 15 AM COR 12 11 Forecast Orig
79. 00 25 5600 23 Total Cakes Stuff Mart CA 20 01 53 68 1596 0 125B Jack Smith 10 10 5266 5266 0 15 000 25 5266 24 Total Cakes Stuff Mart BU 20 02 38 68 15 96 0 125C Jack Smith 10 10 2279 2279 2 000 8 000 25 2279 25 Total Cakes Sids Club VA 20 01 38 68 15 96 0 125C Mary Martin 10 10 3310 3310 4 000 10 000 25 3310 26 Total Cakes Sids Club LF 20 02 3868 1596 0 125B Mary Martin 10 10 4290 4290 4 000 18 000 25 4290 27 Total Cakes Sids Club CO 20 01 3868 1596 0 125B Mary Martin 10 10 5902 5902 5 000 15 000 25 5902 28 Total Cakes Sids Club CH 20 01 53 68 1596 0 125C Mary Martin 10 10 3184 3184 0 8 000 25 3184 29 Total Cakes Sids Club CA 20 01 5368 1596 0 1258 Mary Martin 10 10 2959 2959 5 075 10 993 25 2959 30 Total Cakes Sids Club BU 20 02 3868 1596 0 125A Mary Martin 10 10 5482 5482 4000 25 000 25 5482 31 Total Cakes Grocery Land VA 20 01 38 88 15 96 0 125D Bob White 15 15 706 706 1 000 40 000 35 706 32 Total Cakes Grocery Land LF 20 02 38 88 15 96 0 125 D Bob White 15 15 614 614 2 000 4 000 35 614 33 Total Cakes Grocery Land LE 20 02 3888 1596 0 125D Bob White 15 15 637 637 1 500 4 000 35 637 4 Ee ae i Aa na ARA za nan ronnan ar nan p gt Ready a o n n n Hog 10 O The secondary file table or query must include a record for every end item in the corresponding data file table or query or you will receive an error message when you attempt to read it Notice that the attribute fields are present In ou
80. 01 Formulas Percent 10 Inctement 1 Value 27 060 Override 1 X Help Food King Converted forecasts Grocery Land Sids Club Stuff Mart CO 20 01 Food King Fj Lesson 2 part 1 Graph ol ols Grocery Land rae emt te i Sids Club BU 20 02 SKU gt Stuff Mart LE 20 02 Food King Grocery Land 2010 Jan BB History HB Forecasts Notice that by demoting level 3 of the default hierarchy we have created a new hierarchy that allows us to view and adjust total sales by SKU across customers The status bar lists this new hierarchy as 1 2 4 3 to reflect the fact that we demoted the original level 3 Experiment with the hierarchy adjustment and conversion options until you are comfortable with their operation Then select File gt Close to close the project When prompted DO NOT save the changes to the Lesson 2 part 1 project Working with Override Sets In this section we will explore how Forecast Pro TRAC maintains your overrides when you change units or modify the hierarchy Select File gt Open and open the project Lesson 2 part 2 Working with Override Sets 45 Fh Forecast Pro TRAC Lesson 2 part File Settings Operations Project View Window Hel 090a p j Me 5664 0604 027A 6 O60 86 Stat Forecast Unlocked 2006 1 through 2011 6 Holdout 0 Units Default x BA F Lesson 2 part 2 Override Report ap ease Date Ro
81. 1 APP 12 11 1 Grocery Land Clear COR 12 11 pp 5 Pe Dg yg aa A Pe tiiti lssi BLU 12 11 Display Ancestry gt APP 12 11 Display gt Food King COR 12 11 Save Numeric Output BLU 12 11 Save Forecast Report 1 APP 12 11 Trackines Ranat 3 Cakes Stuff Mart lt E History EE Forecasts EE Forecast Interval OR 12 11 gt Total gt Muffins ffins gt Stuff Mart gt COR 12 11 gt Total gt is gt Stuff Mart gt BRA 12 11 Total gt Muffins gt Stuff Mart gt BLU 12 11 Total gt Muffins gt Stuff Mart gt APP 12 11 M Total gt Muffins gt Stuff Mart gt OAT 12 11 Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins Total gt Muffins lt oto gt COR 12 11 will perform an out of sample test to select between these two approaches Total gt Muffins gt Sids Club gt APP 12 11 The cumulative MAD for Exponential smoothing was 3 037 and for Box Jenkins was 3 097 Tatala Ah fine x Reanna Land The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method The Hot List s context menu allows you to change how items are displayed save Numeric Output files Forecast Report Files and Tracking Reports for the current Hot List items and remove items from the Hot List 192 Command Reference View Windows There are ten view windows available in Forecast Pro TRAC Five of them Forecast R
82. 11 BLU 12 11 APP 12 11 Grocery Land COR 12 11 BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 Cakes Stuff Mart VA 20 01 Total gt Muffins gt Stuff Mart Total gt Muffins gt Sids Club Total gt Muffins gt Grocery Land Total gt Muffins gt Food King Total gt Cakes gt Stuff Mart Total gt Cakes gt Sids Club Total gt Cakes gt Grocery Land Total gt Cakes gt Food King The cumulative statistics for different lead times portion of the report can include up to three sections Series Analysis End item Analysis and Component Analysis End item Analysis and Component Analysis are only relevant to group level data and are not displayed if an end item is selected Series Analysis displays statistics for the currently selected time series If the selection is a group the statistics are based on the archived group level forecasts The CMAPE statistic found in this section is the Component MAPE This is a weighted MAPE where the weighting factors are the component weights see discussion above End item Analysis displays statistics based on the archived forecasts for all end items belonging to the currently selected group The WMAPPE statistic found in this section 1s a weighted MAPE where the weighting factors reflect the end item s volume The weights are calculated by dividing each end item s volume by the group s volume 202 Command Reference Component An
83. 11 oti o lt 2 35 900 78 32 652 18 29 618 46 11 60 bd Food King 0 081 25 727 71 10 680 95 15 668 70 20 17 COR 12 11 otf 2 B 16 285 30 16 285 30 16 285 30 16 28 BLU 12 11 0 539 10 141 75 7 134 37 5 267 31 12 54 APP 12 11 of 914 191444 191444 191444 1914 3 Cakes gt 5 4594 96 539488 3613 00 4 855 gt ae 3 378 83 3 162 30 2 866 00 3 661 VA 20 01 d 4 ST 20 02 2 249 39 2 513 96 1 709 51 2 627 LF 20 02 14 223 63 11 451 83 9 475 05 1662 tn D 7 10 499 85 862123 6331 71 13 92 Stuff Mart BU 20 02 Point forecasts CASE 20 oz Butter Pound Cake Defaut 5 213 17 4 882 29 7 287 90 4 063 00 4 292 63 6 301 40 5220 16 4 425 19 4 604 Sids Club VA 20 01 Point forecasts CASE 20 oz Vanila Layer Cake Defaut 6 146 20 6 42932 653942 485278 3 87267 5 25317 460158 3 838 98 4 465 s Sids Club LF 20 02 Point forecasts CASE 20 oz Low Fat Pound Cake Defaut 10 598 52 10 939 62 11 049 64 9 267 02 10 211 38 14 147 65 7 242 34 12 553 38 19 76 Sids Club CO 20 01 Point forecasts CASE 20 oz Coconut Layer Cake Defaut 8 149 59 9 254 07 9 023 54 6 467 62 5 711 87 6 744 63 6 528 81 5 449 08 6 093 Sids Club CH 20 01 Point forecasts CASE 20 oz Chocolate Layer Cake Defaut 6 020 59 530297 5834 11 6139 07 484295 606636 3 303 77 3 149 82 6 826 Sids Club CA 20 01 Point forecasts CASE 20 oz Carrot Layer Cake Defaut 7 201 53 641232 8956 05 6 537 85 536570 666113 678265 585868 6578 m XX Hier 1 2 3 4 _ 9 Local The Output Format t
84. 12 5832 COR 12 11 CASE 12 count Corn Muffins 2005 9 12 12 8748 COR 12 11 CASE 12 count Corn Muffins 2005 10 12 12 16524 COR 12 11 CASE 12 count Corn Muffins 2005 11 12 12 16524 COR 12 11 CASE 12 count Corn Muffins 2005 12 12 12 23328 COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 17496 COR 12 11 CASE 12 count Corn Muffins 2006 2 12 12 2916 COR 12 11 CASE 12 count Corn Muffins 2006 3 12 12 6804 COR 12 11 CASE 12 count Corn Muffins 2006 4 12 12 17496 2 COR 12 11 CASE 12 count Corn Muffins 2006 5 12 12 1944 COR 12 11 CASE 12 count Corn Muffins 2006 6 12 12 9720 2 __ COR 12 11 CASE 12 count Corn Muffins 2006 7 12 12 3888 COR 12 11 CASE 12 count Corn Muffins 2006 8 12 12 5832 2 __ COR 12 11 CASE 12 count Corn Muffins 2006 9 12 12 12505 5 COR 12 11 CASE 12 count Corn Muffins 2006 10 12 12 17496 COR 12 11 CASE 12 count Corn Muffins 2006 11 12 12 13608 COR 12 11 CASE 12 count Corn Muffins 2006 12 12 12 23328 COR 12 11 CASE 12 count Corn Muffins 2007 1 12 12 26244 __ COR 12 11 CASE 12 count Corn Muffins 2007 2 12 12 10692 COR 12 11 CASE 12 count Corn Muffins 2007 3 12 12 14580 COR 12 11 CASE 12 count Corn Muffins 2007 4 12 12 3888 COR 12 11 CASE 12 count Corn Muffins 2007 5 12 12 6804 COR 12 11 CASE 12 count Corn Muffins 2007 6 12 12 6804 COR 12 11 CASE 12 count Corn Muffins 2007 7 12 12 6804 COR 12 11 CASE 12 count Corn Muffins 2007 8 12 12 6804 v Record
85. 18 Amy Brown 10 10 3438 3438 4252 11 129 25 3438 9 Total Muffins Sids Club BLU 12 11 22 52 7 1 01118 Amy Brown 10 10 5101 5101 0 25 000 25 5101 10 Total Muffins Sids Club APP 12 11 22 52 7 4 0 111B Amy Brown 10 10 9378 9378 0 35 000 25 9378 11 Total Muffins Grocery Land COR 12 11 13 67 7 4 0 111B Bob White 15 15 2646 2646 4 000 12 000 35 2646 12 Total Muffins Grocery Land BLU 12 11 23 67 7 1 0 111C Bob White 15 15 1873 1873 2 000 8 000 35 1873 13 Total Muffins Grocery Land APP 12 11 23 67 7 4 0 111B Bob White 15 15 4320 4320 4 918 13 558 35 4320 14 Total Muffins Food King COR 12 11 13 67 7 1 O111A Bob White 15 15 12979 12979 0 36 000 35 12979 15 Total Muffins Food King BLU 12 11 23 78 7 1 O111A Bob White 15 15 11379 11379 5 899 28 658 35 11379 16 Total Muffins Food King APP 12 11 23 78 7 4 O111A Bob White 15 15 7266 7266 3 278 17 811 35 7266 17 Total Cakes Stuff Mart VA 20 01 38 68 15 96 0 125 B Jack Smith 10 10 5040 5040 0 15 000 25 5040 18 Total Cakes Stuff Mart ST 20 02 3868 15 96 0 125 E Jack Smith 10 10 930 930 1 000 4 000 25 930 19 Total Cakes Stuff Mart LF 20 02 38 68 1596 0 125 C Jack Smith 10 10 1367 1367 2 000 6 000 25 1367 20 Total Cakes Stuff Mart LE 20 02 3868 15 96 0 125D Jack Smith 10 10 992 992 2000 4 000 25 992 21 Total Cakes Stuff Mart CO 20 01 3868 1596 0 125E Jack Smith 10 10 1487 1487 429 3 376 25 1487 Total Cakes Stuff Mart CH 20 01 5368 1596 0 125A Jack Smith 10 10 5600 5600 0 15 0
86. 249 End User License A Ore Ciine int ices es dcr taste cares Sat ietctoiviearie ai 253 DU SSCSISd Reading sisese ENa ataanineakenceeaiels 256 EEO ed COTE SEEP RA EEA SOEI ESEE A E EESO EIEEE A E E OET 259 vii GETTING STARTED Chapter 1 Before You Begin Forecasters and Collaborators Forecast Pro TRAC is available in two different types of licenses Forecaster licenses and Collaborator licenses The type of license you install will dictate the functionality you can access A Forecaster has access to all of the functionality described in this manual A Collaborator can view and manipulate a forecast project created by a Forecaster including viewing graphs and reports adding overrides and comments saving output etc but cannot generate new Statistical forecasts Operationally the two installations are very similar however a Collaborator does not have access to any of the functionality relating to reading historical data and generating statistical forecasts Thus there are sections of this manual which will not be relevant to Collaborators How to Use This Manual This manual is divided into four parts Part 1 Getting Started Chapter I describes the Forecast Pro TRAC system requirements and product support policy Chapter 2 describes the installation procedure Chapter 3 provides an overview of forecasting Part 2 Tutorial General Operations Lesson I walks you through a sample forecasting session using automatic model se
87. 5 The remaining items 5 or less of the cumulative volume are assigned type C The Series Count option allows you to assign specific numbers of items to each group For example if you had 1 000 items and you set the A group to 100 the B group to 200 and the C group to 700 the 100 highest volume items would be assigned to group A the next highest 200 items would be assigned to group B and the remaining 700 would be assigned to group C 66 Pareto Analysis and Report Filtering The Series Count assigns the specified percentage of the total number of items you have to each group For example if A is set to 20 B is set to 50 and C 1s set to 30 Forecast Pro TRAC will first rank all of the items from highest volume to lowest volume and then sequentially place the top ranked items into the A group until the number of A group items equals 20 of the total number of items It will then sequentially place items into the B group until the number of B group items equals 50 of the total number of items The remaining items 30 of the total number of series are assigned type C If selected the Group zero volume option will place any items with zero volume into group D Make sure that your settings match the ones above and click OK Sorting and Filtering the Pareto Output Right click on the Item Report view to display its context menu and select Item Report Design Item Report Design jem fi a Click the checkb
88. 621 44 155 Grocery Land 4 028 E E 2 12 COR 12 11 Mar B589 26 227 BLU 12 11 27 406 40 305 APP 12 11 2011 May 3 Food King a COR 12 11 Lead time bE ji a 5 o s Analysis BLU 12 11 APP 12 11 o observations 6 6 3 Cakes 3 Stuff Mart 8 511 VA 20 01 9 945 Total gt Muffins gt Stuff Mart Total gt Muffins gt Sids Qub Due to its cascading like appearance the tracking report is sometimes referred to as a waterfall report The report compares what we forecasted to what actually happened therefore it is based on two key elements the actual demand history and archived forecasts for the periods being analyzed In the example above the actual demand history for the most current six months is shown in the first row with the green shading The next row down displays the Component Weight This displays the percentage that the demand represents of its parent group Thus in our example in January of 2011 Total gt Muffins gt Stuff Mart gt Cor 12 11 composed 26 71 percent of the demand for its parent group Total gt Muffins gt Stuff Mart The next 6 rows display the forecasts generated for these periods from different forecast origins Thus the row labeled 2010 Dec displays the forecasts generated six months ago when the forecast origin was December 2010 and the first forecast period was January 2011 The row labeled 2011 May displays the forecast generated last month when the foreca
89. 7 90 4 063 00 4 29263 6 301 40 5 220 16 4 425 19 pga ee A Cakes Sids Cib VA 20 01 Point forecasts CASE 20 oz Vanila Layer Cake Defaut 6 146 20 6 429 32 6 539 42 4 852 78 3 87267 5 253 17 4 601 58 3 838 98 Total gt Muffins gt Food King Cakes Sids Club LF 20 02 Point forecasts CASE 20 oz Low Fat Pound Cake Defaut 10 598 52 10 939 82 11 049 64 9 267 02 10 211 38 14 147 65 7 242 34 12 553 38 La er aaa rat re Cakes Sids Cub CO 20 01 Point forecasts CASE 20 oz CoconutLayer Cake Defaut 8 149 59 9 254 07 9 023 54 6 467 82 5 711 87 6 744 63 652881 5 449 08 Total gt Cakes gt Grocery Land Cakes Sids Club CH 20 01 Point forecasts CASE 20 oz Chocolate Layer Cake Defaut 6 020 59 5 302 97 5 834 11 6 139 07 4 842 95 6 066 36 3 303 77 3 149 82 Total gt Cates gt Food King Cakes Sids Club CA 20 01 Point forecasts CASE 20 oz Carrot Layer Cake Defaut 7 201 53 8 41232 8 956 05 6537 85 5 265 70 666113 678265 5 858 68 65783 gt m b Rea XZ Hier 1 2 3 4 _ 9 Local The Numeric Output Preview window displays the contents and format of the currently specified Numeric Output file Click Settings gt Numeric Output Design Output Forecast file prefix Default units only Defaut hierarchy only include tems without forecasts Select filter attributes to display v Headings V Exclude group totals Exclude endtems V Single output file V Break record up into lines Transactions This dialog box allows you to design the Numer
90. 794 9806 5 287 6744 BRA 12 11 Demand Planning __ 7 190 _ 9 306 BLU 12 11 Managment 10 000 APP 12 11 JOveride3 OAT 12 11 T E EE Ss es gt Sids Club 10 000 9 304 14795 19385 16493 33322 19761 8742 12794 9806 5287 6744 COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 Formulas Percent 10 gt Increment 1 gt Value 4 825 Demand Plann v Help Grocery Land History Converted forecasts COR 12 11 BLU 12 11 APP 12 11 F time Fence Forecast Report Food King Forecast Data COR 12 11 0W 12 11 Date 2 5 Lower APP 12 11 2011 Jul 7 303 Cakes Stuff Mart 2011 Aug 5 420 VA 20 01 2011 Sep 6 524 2011 Oct 2011 Nov 2011 Dec 2012 Jan 2012 Feb 2012 Mar 2012 Apr 2012 May 2012 Jun 9 534 8 112 14 695 8 715 172 311 Read SZ Hier 1 2 3 4 _ 9 Local 236 Command Reference The screen above shows the Forecast overrides view for an item with a 3 month time fence Notice the second to last row of the grid is labeled Time Fence The values displayed in this row are the unchangeable fenced values and the same values appear in the final Forecast row Notice that the statistical forecast for September 14 795 does not equal the time fence value 16 457 This is because September s time fenced value was established when last month s forecasts were generated Let s now consider what happens next month We update our data wi
91. A EE EE A E E A P A E A AO E ASEEN EENE ae E d AEE xpo RTT ONIN ON Oorr 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Jan 2011 Jan 2012 Jan E History EE Forecasts E Forecast Interval The Override view provides several different ways to override the statistical forecasts You can enter values in individual override cells you can select a range of cells and use the Percent Increment or Value buttons to write the desired overrides to the target override row or you can use the mouse to drag points on the graph If a time period has overrides in both Override 1 and Override 2 Override 2 will take precedence Highlight the Statistical values for August and September of 2011 Set the Percent box to 12 and click the Percent button Notice that the proposed overrides are written to the target row indicated to the immediate left of the Commit button in this example Override 1 Notice also that the values displayed in the Forecast row have not changed this is because we have not yet committed to the overrides Uncommitted overrides are displayed in red both in the override row and on the graph 32 The Basics Click the Commit button to accept the overrides Notice that the formerly uncommitted values in the override row change to black the Forecast row is updated and the graph is updated Notice also that the icon for Total gt Muffins gt Stuff Mart on the Navigator now appears in red and the icons for Total gt Muffins and Total in y
92. For example imagine that you had both price promotions and rebate promotions In this case you would create an event file coding months as not promoted 0 price promoted 1 or rebate promoted 2 When you build the event model it will include two different adjustments one for price promoted months type 1 months and one for rebate promoted months type 2 months eect cS SS __ O O O fis Satins Operations Project View Window Help 0666 55 664 01646 0 4 8 OOO 8S 2007 1 through 2011 3 gt Holdout 0 5 Units Stat Forecast Unlocked MintyFresh24 24 ounce bottle of MintyFresh Mouthwash Project05 Forecast Report ol eis Forecast Report for MintyFresh24 24 ounce bottle of MintyFresh Mouthwash Total gt MintyFresh24 Raw hierarchy is Total gt MintyFresh24 Simple exponential smoothing No trend No seasonality Select MintyFresh24 on the Navigator Right click to call up the context menu and select Events Selecting Events will display the available helper variables and allow you to select the one you wish to use In this example there is only one helper variable _PriceSpecials Select _PriceSpecials to build the event model Examine the forecast report for MintyFresh24 Notice that an exponential smoothing model was used and that the model includes an event smoothing weight In addition notice that the adjusted R square is now 0 79 The graph the results reveals a much better fit to the
93. ForecastPRO forecastpro com BUSINESS FORECAST SYSTEMS The comprehensive solution for all of your business forecasting needs Forecast Pro TRAC User s Guide Eric A Stellwagen Business Forecast Systems Inc Copyright 1990 2012 Business Forecast Systems Inc All Rights Reserved Worldwide No part of this document may be reproduced without express written permission of Business Forecast Systems Inc Software Version 2 2 Manual Last Revised February 8 2012 Business Forecast Systems Inc 68 Leonard Street Belmont MA 02478 USA Phone 617 484 5050 Fax 617 484 9219 Email info forecastpro com Web www forecastpro com Copyright Notice Copyright 1990 2012 by Business Forecast Systems Inc All Rights Reserved Worldwide No part of this manual may be reproduced transmitted transcribed stored in a retrieval system or translated into any human or computer language in any form or by any means electronic mechanical magnetic optical chemical manual or otherwise without express written permission of Business Forecast Systems Inc 68 Leonard Street Belmont MA 02478 USA Disclaimer Business Forecast Systems Inc makes no representations or warranties with respect to the contents hereof and specifically disclaims any implied warranties of merchantability or fitness for any particular purpose Further Business Forecast Systems Inc reserves the right to revise this publication and to make
94. Jan E Forecasts MMB Forecast Interval Read X Hier 1 2 3 4 Local Turn off the Forecast Report view turn on the Override Forecasts view and check the box for the Converted forecasts option Your display should now look like the one above Working with Alternative Units of Measure 43 Notice that the Converted forecasts option adds additional rows to display the forecasts in the alternative units of measure This allows you to enter changes in the currently displayed units in this example the default cases and immediately see the impact on the other units of measure Turn off these display rows by removing the check mark from Converted forecasts Open the Units drop down box on the dialog bar and select Dollars A warning message informs you that this action will lock the statistical forecasts move all current overrides into the inherited override row and discard all current comments we will discuss the treatment of overrides later in this lesson Click OK to continue Notice that the history and forecasts are now displayed in dollars and the status box above the Navigator reads Stat Forecast Locked You are now working with dollars Any overrides that you make to the forecasts reports that you generate etc will be in dollars Changing the Hierarchy In our current example we have a 4 level hierarchy As we commented previously because we are currently viewing the default hierarchy i e
95. Lower modifier Safety stock lead time Specify the lead time for the safety stocks The specified lead time appears highlighted in the Safety Stock section of the Forecast Report and determines the values written to the Numeric Output file Fractional entries e g 1 5 are permitted Basic Formats Outliers Overrides Command Line Advanced Controls Pareto Analysis Input Data Decimal separator Period v ignore leading zeroes Column delimiter Space x ignore trailing zeroes Thousands separator Comma Missing values Percentage The Formats tab controls the formatting of the input and output 218 Command Reference Decimal separator Specify whether a period or a comma is used for the decimal point The program s default is the convention appropriate for the United States which is the period Column delimiter Specify whether items in an MLT file are separated by spaces commas or tabs 1 e are the files space delimited comma delimited or tab delimited Thousands separator Specify the thousands separator used for input MLT files The choices are none comma and period Forecast Pro TRAC does not use thousand separators in output Ignore leading zeros If this option is selected then leading zeros prior to the first nonzero data point will be ignored 1 e the data has not started yet and the zeros are interpreted as placeholders For a more complete discussion on the handling of missing data an
96. Mode setting controls what cumulative statistics to display for group level data The Periods to display controls the number of lead times to include in the report and the Lead time s box allows you to specify up to four lead times to color code Experiment with the report settings until you are comfortable with their operation When you are finished exit the program without saving changes to the Lesson 6 project When reviewing tracking reports you ll often want to concentrate on items where the forecast accuracy has fallen outside of an acceptable range Exception reports can be quite useful in this regard and is the subject of our next lesson This concludes Lesson 6 74 Tracking Forecast Accuracy Lesson Exception Reporting Exception reports enable you to quickly find cases where your forecast error or some other performance metric has fallen outside of an acceptable range Exception reporting reduces the need for manual review of your forecasts and allows you to focus on the items where human attention is most needed Forecast Pro TRAC provides a wide array of exception reports some of which monitor the current forecasts and others which monitor your archived forecasts Monitoring Current Forecasts Start Forecast Pro TRAC select File gt Open and open the project Lesson 7 This project contains forecasts for the muffins and cakes data that we worked with in previous lessons Click the yellow View Exception R
97. Muffins Total gt Muffins gt Stuff Mart gt COR 12 11 Report Hot List gt Raw hierarchy is Total gt Muffins gt Stuff Mart gt COR 12 11 window Expert Analysis status bar gt es Hier 1 2 3 4 _ Local The Forecast Pro TRAC window consists of the following seven parts Menu bar Toolbar Dialog bar Navigator Hot List 9 view windows three are shown above Status bar The Menu bar The menu provides access to all commands A complete listing of all menu items and their associated dialog boxes is presented later in this chapter The Toolbar The icons on the toolbar provide a quick access to the most commonly used commands Here are the icons and their functions The Forecast Pro TRAC Interface 187 0 o A JOO O OQO OOA New Project Closes the current forecast project allowing you to start a new one Open Project Opens an existing forecast project Save Project Saves the active forecast project Archive Forecasts Writes the forecasts and other information to the Forecast Pro TRAC database By default Forecast Pro TRAC will automatically archive the forecasts when you save the project This icon is usually used by individuals who have elected to turn of the Archive forecasts automatically option Copy Copies the current selection to the Windows clipboard Paste Inserts the contents of the Windows clipboard into the current insertion point Script Accesses the Define Scr
98. NCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTIES ARISING OUT OF COURSE OF DEALING OR COURSE OF PERFORMANCE BFS EXPLICITLY DOES NOT WARRANT THAT THE SOFTWARE WILL MEET ALL OF YOUR REQUIREMENTS OR THAT THE OPERATION OF THE SOFTWARE WILL BE ERROR FREE YOU ACKNOWLEDGE THAT YOU HAVE RELIED ON NO WARRANTIES AND NO WARRANTIES ARE MADE HEREIN BY BFS 7 LIMITATION OF LIABILITY BFS SHALL NOT BE LIABLE FOR ANY LOSS OR DAMAGE THAT MAY BE RELATED TO THE FURNISHING PERFORMANCE OR USE OF THE SOFTWARE INCLUDING WITHOUT LIMITATION ANY INDIRECT SPECIAL INCIDENTAL ECONOMIC LOST PROFIT OR CONSEQUENTIAL LOSS OR DAMAGE OF ANY KIND WHATSOEVER EVEN IF BFS HAS BEEN ADVISED OF THE POSSIBILITY OF THOSE DAMAGES IN NO EVENT SHALL BFS S LIABILITY UNDER THIS End User License Agreement 255 EULA EXCEED THE AMOUNT PAID FOR THE SOFTWARE LICENSE IF ANY 8 TERM AND TERMINATION This EULA is effective until terminated Your rights under this EULA will terminate automatically without notice from BFS if You fail to comply with any provision of this EULA Upon termination of this EULA You must destroy all copies full or partial of the Software You agree that upon termination of this EULA for any reason BFS may take actions so that Software no longer operates 9 GENERAL TERMS AND CONDITIONS A You acknowledge that You have read this EULA understand it and agree to be bound by
99. SX WK amp CSV and Open Database Connectivity ODBC Examples of each file type are shipped with the program Which data format you choose will depend on your application and database operations Before making your choice you should be aware of the following advantages and disadvantages of each file type Spreadsheet XLS XLSX WK amp CSV files Uses Excel and Lotus format spreadsheets or CSV Comma Separated Values files saved from Excel to hold data You can make and forecast multiple spreadsheet files on one script if you wish PROS If you are comfortable using a spreadsheet then the spreadsheet format allows you to create update and manipulate your data in a familiar environment Processing time for xls files is faster than for ODBC Creating forecast reports from Excel is straightforward CONS The layout of your spreadsheet must follow the Forecast Pro TRAC rules You may have to change your current spreadsheet layout to one you Selecting a Data Format 139 find slightly less convenient Processing time for xlsx files is slow xls is faster and csv is faster still Text CSV MLT files Uses text files to hold data You can make and forecast multiple MLT files on one script if you wish PROS Processing time is faster than for ODBC and spreadsheets excluding CSV which is text based Most databases can output text files CONS Editing viewing and updating large MLT files can be clumsy Not all editors accept very
100. Total Muffins Stuff Mart COR 12 11 CASE 12 count Corn Muffins 1 12 3 Total Muffins Stuff Mart BRA 12 11 CASE 12 count Bran Muffins 2006 1 12 12 20 829 72 576 11 016 4 Total Muffins Stuff Mart BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 5 Total Muffins Stuff Mart APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 6 763 7 661 9 561 6 6 Total Muffins Stuff Mart OAT 12 11 CASE 12 count Oatmeal Muffins 2006 1 12 12 21 042 0 0 7 Total Muffins Sids Club COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 8 Total Muffins Sids Club BRA 12 11 CASE 12 count Bran Muffins 2006 1 12 12 3 572 4 000 2 808 5 9 Total Muffins Sids Club BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 15 307 1 866 3 477 6 10 Total Muffins Sids Club APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 25 404 450 906 4 11 Total Muffins Grocery Land COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 12 Total Muffins Grocery Land BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 7 383 6 512 4 375 3 13 Total Muffins Grocery Land APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 21 729 13 780 9 072 6 14 Total Muffins Food King COR 12 11 CASE 12 count Corn Muffins 2006 1 12 12 15 Total Muffins Food King BLU 12 11 CASE 12 count Blueberry Muffins 2006 1 12 12 16 Total Muffins Food King APP 12 11 CASE 12 count Apple Muffins 2006 1 12 12 17 Total Cakes Stuff Mart VA 20 01 CASE 20 oz Vanilla Layer Cake 2006 1 12 12 0 840 18 480 15 18 Tota
101. a hound Ace en ey fen naa ae han 195 he Override Forecasts V 1G W ssssussuusanieis eussetsasesdtes wrededadadanar aecaigteaescedeovoanta 198 The Tracking Report and Tracking Report Graph View6 ccccsseeeeees 200 Ehe Nem Report WV 16 W ease ductsus sa hhataenciatanaastiadn dda cataiuae turin blondie ieiatevelavaiees 204 The Exception Report V1GW secsctanicen neues a a ret ouiainpniarea seed ee Manieusiets 204 Te OVetrides Report VIEW reren ce tat E T 211 The Ou ther Report VIEW seces rican E 212 The Numen Output V1 Woie ete naw die ath eee ao 212 Menu Items and Dialog BORXES defects dic sendecarnsie annie en aaidiseigeniedia ucts 216 W orkime with Pea ATN ES vecier casos tcecataste a a 235 Usmo TSF CC searchers tian esrosreas cen ctnss deaated eateries ante ac insaaienetonnandadtayeneanensenaeseaatts 236 Command line Opera Otic Gasneinu weit Saboatiemi oats 238 Understanding How Forecast Overrides are Allocated ccsssees 241 Adjustments Made to a Single sey Cl acenoneitertnretenseuinectitetusiuceaenices masieees 241 Adjustments Made to More Than One Level cccccecccccecceeessseeeeeeeees 243 Examples Where Overrides Cannot be Allocated 0 cccececccececsssseeeeeeeeees 245 SU ETAT OI cio siese sp achesarlaritin a a sae 247 PLD CIGINES s sevuscscaneveveseescaccderelevelscceacedansievsceuscausdaadaeccdeseuausdansiecseseevesdendiecides 249 Speeding Wp Ine Pro er ane siess ir we weniteienenenaavines
102. ab is used to specify the basic layout for the Numeric Output file Forecast file prefix Specify the character s to use as the default prefix when naming the Numeric Output file If the Single Output file option is selected in the Layout section the default Numeric Output filename will be the prefix followed by the project name followed by Numeric Output If the Single Output file option is not selected each output filename will be the prefix followed by the corresponding input filename Default units only If this option is selected the Numeric Output file will save the forecasts and other components using the default units 1 e the units The Numeric Output View 213 defined in the input data source If this option is not selected the Numeric Output file save the forecasts and other components using the units of measure currently selected in Forecast Pro TRAC Default hierarchy only If this option is selected the Numeric Output file will save the forecasts and other components using the default hierarchy 1 e the hierarchy defined in the input data source If this option is not selected the Numeric Output file will save the forecasts and other components using the hierarchy currently selected in Forecast Pro TRAC The Layout section of this tab allows you to specify the default data mode the orientation row vs column whether or not to include group level output and whether or not to include item level data Single
103. able maximum Defines item level allowable fitted MAD threshold Defines 1tem level allowable fitted MAPE threshold Defines item level lower threshold for allowable percent deviation of current forecast value from archived forecast value Defining the Secondary File 155 FVA_MAXP FVA_MIN FVA_MAX AVA_MINP AVA_MAXP AVA_MIN AVA_MAX WE_FC_MIN 156 Setting Up Your Data Forecasts vs Archive Forecasts vs Archive Forecasts vs Archive Archive vs Actual Archive vs Actual Archive vs Actual Archive vs Actual Waterfall Defines item level upper threshold for allowable percent deviation of current forecast value from archived forecast value Defines item level lower threshold for allowable unit deviation of current forecast value from archived forecast value Defines item level upper threshold for allowable unit deviation of current forecast value from archived forecast value Defines item level lower threshold for allowable percent deviation of archived forecast value from actual Defines item level upper threshold for allowable percent deviation of archived forecast value from actual Defines item level lower threshold for allowable unit deviation of archived forecast value from actual Defines item level upper threshold for allowable unit deviation of archived forecast value from actual Defines item level lower WF_FC_MAX WF_ERR_MIN WF_ERR_MAX WF_MPE_MIN
104. ading day impacts or to forecast new products based on similar products Lesson 14 teaches you how to use Forecast Pro TRAC s outlier detection and correction functionality Lesson 15 teaches you how to assess forecasting performance using a holdout sample approach All of the lessons use sample data provided with the software Part 4 Reference Chapter I explains how to select the appropriate data format and how to set up your database Chapter 2 describes the various reports and output files that can be saved Chapter 3 describes how to set up a Forecast Pro TRAC script and also discusses the strategies that Forecast Pro TRAC uses to produce consistent forecasts for hierarchical data Chapter 4 describes all available forecast modifiers and their functions Chapter 5 is a complete reference to Forecast Pro TRAC menus options and commands How to Use This Manual 5 Chapter 6 describes how Forecast Pro TRAC reconciles forecast adjustments between different levels of the forecasting hierarchy The Appendixes describe how to speed up processing and provide other supplementary information Many users won t want to work their way through each and every part of this manual However we urge you to go through at least Chapters 1 3 of Getting Started Lesson 1 2 amp 3 of the Tutorial and as many other lessons as you want This will give you a good overview of Forecast Pro TRAC operations and capabilities When you are ready to
105. alysis displays statistics based on the archived forecasts for all component children 1 e groups and or end items one level lower in the hierarchy belonging to the currently selected group The WMAPE statistic found in this section 1s a weighted MAPE where the weighting factors reflect the component children s volume The weights are calculated by dividing each component child s volume by the group s volume The content and format of the Tracking Report 1s controlled using the Tracking Report Settings dialog box This dialog box is invoked by selecting Settings gt Tracking Report Settings or by selecting Tracking Report Settings from the Tracking Report view s context menu 3 8 The Forecasts section allows you to display either the statistical or adjusted forecasts The Report type section allows you to display either the forecasts the forecast error or the percent forecast error The Analysis Mode section allows you to specify which cumulative lead time statistic displays to include Most of the items in the Layout section are self explanatory however we will comment on a couple of them The Periods to display controls the number of lead times to include in the report The Include preceding forecasts option displays all archived forecasts that go into the cumulative statistics rather than just the subset in the triangular display The Lead time s box allows you to specify up to four lead time
106. ame of the time series containing the analogy series Model gt By Analogy ANALOG X A B Use the by analogy model with a specified launch total of A and a specified launch horizon of B Model gt By Analogy ANALOG X A B C D Use the by analogy model with a specified launch total of A a specified launch horizon of B and a specified launch date with a starting year of C and starting date of D This option is only available when the series being forecasted has no historic data Event Model Modifiers To build an event model you must tell the program when events of each type occur To do this you must construct an event schedule which classifies each period by event type O no event 1 event of type 1 2 event of type 2 etc The format is the same as that for any other historic data record except that its entries are all small integers The event schedule must be defined for each period in the historic record If you want to forecast the effects of future known events you must include these future periods as well The event schedule is a helper variable Helper variables names must start or end with an underbar Helper variables are not forecasted and their values are not included in group totals Helper variables are used in conjunction with event models weighting transformations and by analogy models For examples of constructing event variables and building event models consult Building Event Models in the tutorial section For
107. anges to the Lesson 4 part 1 project 60 Collaborating With Colleagues Working with Team Archives Let s consider the following example A company sells their products in three countries the United States Canada and Mexico They employ three different demand planners each of whom is responsible for forecasting a specific country After the demand planners have completed their forecasts they meet with management to review the forecasts and make any required adjustments Accomplishing this using a single stand alone project would require a sequential review process For example assume the demand planner for the United States goes first He or she would create a forecast project which includes all three countries and then review and make adjustments to the United States data and save the project Next the planner for Canada would open the project review and adjust the Canadian data and save the revised project Next the planner for Mexico would open the project review and adjust the Mexican data and save the revised project At this point the demand planners forecasts are complete and the project is ready for the management review meeting Clearly there are some downsides to the above procedure One is that the demand planners cannot work on their country level forecasts simultaneously they have to wait until it is their turn to do so Another problem is that even though they are working on a single country the project conta
108. antonsels 152 Savine OUP VV OEM ssec cccescnssswshovawaneatuasaaseestesdeuesacvshasaecudanncsasaseastesdeudsuawes 159 Ore Cast PrOjects s s sacstanutcersss soa N 160 N mernec CUED UU FUNC rpc E a enenaupan anita ates ated 163 Formatted Forecast RePORS seisseen EE E 163 Tracking Repo Seea OR EAEE 164 Enr REPON Saia a A 165 Overmide KEPO S ain a E 165 Except on REpOliSiceneneei i a E NN 166 OWHEE REDONS enai E N TAT 166 Working with Scripts and Hierarchies sscccccccsssssssssssssccccssssesees 167 STIS CNS o D eea E E 167 Denmns the Fe rare hy aser ieede era uae edad enteseaneee ears 168 ReCOncilin the Tie tar hy seerne Aa 170 vi Using Forecast Modifiers osc vs sass asicccsiwtecsesesacetis covacseseseccutsevtacsesuscestuseseaciesss 175 Model Specification MIOGINETS senecon an OO manana eu does 175 Event Model Modi ETS scierie eaten uetia Rie alates 180 The Weighting Transformation Modifier ccccccccccceeccesseeeeeeeeeeeeeeaeeess 181 Outlier Detection Correction Modifiers eseessseeeeenssssssseserressssseseersssss 182 Reconcihat ow Modi Her aasa E une dsmesadtee 183 Miscellaneous Custom Modifiers cccccccccsssssssseececcceeeeeesseeecceeeeeeeseeeeees 184 Command RETCKENCE 6 scess disses tise cacs seteslessdiccschine dese aia utente 185 Operations OV er View accepi a O aceealtld 185 The Borecast Pro TRAC Interfit rneccnsteren tini icant A 186 Tne Forecast REPON VIEW aena A 193 Tae ATOLL ON ena
109. ar information etc if you wish After the record headings comes header information for the first variable followed by decimal numbers representing the historical data and then a semicolon This is followed by the same format for subsequent time series Two semicolons in a row mark the end of the MLT file Since Forecast Pro TRAC recognizes spaces tabs and returns as equivalent terminators you have a great deal of flexibility in formatting your data The most common format is to organize series by rows as in the following example A esd 6 i in File Edit Search View Tools Macros Configure Window Help DF MA SRB SHO CETE AREETA oe i Findincrementally Match case Horizontal mit vx 12 12 117497 153276 241443 218709 SKU_001 Product 1 2006 1 SKU_002 Product 2 2006 1 12 12 155 199 1959 159 SKU_003 Product 3 2006 1 12 12 443 469 251 286 SKU_004 Product 4 2006 1 12 12 403 372 381 465 SKU_005 Product 5 2006 1 12 12 13224 14404 2 17824 20295 SKU_006 Product 6 2006 1 12 12 2107 2097 2135 2165 SKU_007 Product 7 2006 1 12 12 90000 87000 111000 108000 SKU_008 Product 8 2006 1 12 12 2783 7 3746 94 6404 38 5074 9 SKU_009 Product 9 2006 1 12 12 12344 139707 138587 9 13109 SKU_010 Product 10 2006 1 12 2 2496 26 2485 05 2639 59 2649 4 Text MLT Formats 145 The above example does not use attribute fields to define product groupings This is often desirable and is discussed in the Using attribute field
110. ariable at some time interval Business series are usually expressed in terms of the calendar and can be daily weekly monthly or quarterly Forecast Pro TRAC can work with any type of time series but is oriented towards weekly monthly and quarterly calendar data 135 Collection and maintenance of reliable historic data is up to you and your IT department and can be implemented in many different ways depending on information flow conditions in your organization Data length Forecast Pro TRAC works by fitting a statistical model to your historic data and extrapolating it via the fitted model Thus your data must be long enough to provide reasonably stable estimates of the most important features of the data Very short or very noisy historic records usually yield very simple models because the data are too short to support statistical estimates of important features like seasonality If the data are very short say four points or fewer Forecast Pro TRAC can pick up neither seasonality nor trend and reverts to the Simple Moving Average model For more than four points but less than two years worth of data Forecast Pro TRAC can fit and forecast trends but not seasonality If your data are in fact nonseasonal your forecasts are likely to be adequate If your data are in fact seasonal the forecasts are likely to be poor Forecast Pro TRAC cannot extract or forecast the seasonality and part of the seasonality may be mistaken for trend
111. as restored the Hot List forecast modifiers and overrides and that the overrides correctly reflect the new dates At this point we have generated a new forecast Let s save this project using a different name so that we can retain both our Lesson 3 June 2011 project and Step Two Opening Your Forecast Project 51 our new July forecasts Select File gt Save As and name the project Lesson 3 July 2011 Step Three Saving Your Work If this was a real forecasting session we would now review the new forecasts add any needed overrides adjust the forecasting models as appropriate share the forecast project with others etc until we establish the final July forecast Once we ve established the final forecast we would save our final project file for the July forecast and save any desired output files Exit Forecast Pro TRAC using File gt Exit Working with Override Sets In our last example we updated a very simple project that was saved when the Statistical forecasts were unlocked This means that the person who created the project never changed states 1 e they did not change units nor change the hierarchy When you update a project that was saved in an unlocked state Forecast Pro TRAC allows you to automatically load the overrides If you update a project that was saved in a locked state then you will have to explicitly load any override sets that you wish to apply using Project gt Import gt Archived Overrides Let s see how
112. asonal data and then reseasonalizes the forecasts The forecasts are then reconciled as already described A note about negative values In a multiple level problem it is assumed that the data are basically nonnegative the aggregate level data must be non negative but the item level data can include a few negatives Negative sales figures are relatively common since many companies register returns as negative sales Furthermore returns are often accumulated on the books and taken as occasional hits on sales While this may make good accounting sense it raises forecasting problems and will certainly decrease accuracy Ideally companies would either distribute returns to the months in which the products were shipped or maintain returns as an entirely different historic record Nevertheless listing sales as negative is common and must be dealt with in some way Beyond an expected decrease in accuracy for forecasts from a product with negative sales negatives pose a technical problem for product hierarchies Multiplicative seasonal indexes cannot be extracted from a nonpositive series and additive indexes cannot be disaggregated to nested products Thus if the group level data contain negatives Forecast Pro TRAC will use an additive index model and seasonal disaggregation will not be allowed 1 e the INDEXES flag will be ignored In the case of positive group level data with negative values in the constituent data the multiplica
113. ast Pro TRAC will then create the forecast by proportionally allocating the launch total over the launch horizon using the analog series to define the proportions If any historic demand for the new product is available you may either supply the launch total and launch horizon or allow Forecast Pro TRAC to calculate the forecasts by fitting the existing data to the analog series In this exercise we will look at two examples one where no data are available for the new product and the other where the initial 3 months of sales are known Start the program click the red Script icon and select New Product Data Accept the script read in the data forecast the data open the graph view and fully expand the Navigator Right click Product 0 on the Navigator to invoke the context menu and then select Model gt By Analogy Forecasting by Analogy Model Setting chtotal NA We must begin by selecting the analog variable to use In our example there are two available Select _Profile 1 by clicking it Since Product 0O does not contain any historic demand a launch total must be specified The default value for the Specified launch total is to calculate it using the values specified in the analog variable in our example this yields 279 587 Let s say that our market research leads us to believe that this new product will sell 500 000 units in the first 12 months To have our forecast reflect this assumption edit the Specified launc
114. ast Unlocked 100 1 gt through 111 12 gt Holdout amp _ Reset Units MAK044 SMA 3 MAKO45 SMA 3 MAK046 SMA 3 MAKO47 SMA 3 5 MAKOAS SMA 3 E out of sample Rolling Evaluation for Items in Group MAK049 SMA 3 MAK0SO SMA 3 MAKOS1 SMA 3 Hor N MAPEN MAD MAKO052 SMA 3 1 408 408 1 910 14 1 910 14 MAK0S3 SMA 3 213401340 2 091 25 1 992 46 MAKISENSMA 3 3 2724272 1 961 82 1 984 29 oE 412041204 1 970 14 1 981 93 MAKOS6 SMA 3 PERERA 51136113 2 302 64 2 014 00 MAKOSS SMA 3 6 68 68 2 388 80 2 031 85 MAKOS9 SMA 3 MAK060 SMA 3 Out of Sample Static Evaluation MAKO61 SMA 3 MAK062 SMA 3 Faucet K AD nin e MAN 930 011 89 932 457 91 2 446 02 2 446 02 SANE NAR 930 011 89 852 988 42 77 023 47 39 734 75 E ADNE 930 011 89 876 756 39 53 255 50 44 241 67 MAK066 SMA 3 DAA 930 011 89 868 048 62 61 963 27 48 672 07 930 011 89 803 670 82 126 341 07 64 205 87 930 011 89 883 766 35 46 245 54 61 212 48 930 012 930 012 There are no overrides for this item There are several ways to compare the results of this forecast and our expert selection forecast The most common approach is to look at the MAPEs Mean Absolute Percent Error for the two In our example the MAPESs for expert selection are lower than the MAPEs for the moving averages for every time horizon clear evidence that expert selection outperforms the moving averages The other comparison statistic that can be used is the GMRAE Geomet
115. asted and as a final step reseasonalized This approach works well when the items share the same seasonality It allows one to deal with items whose histories are too short to extract seasonality directly You cannot nest INDEXES groups 170 Working with Scripts and Hierarchies within each other Model parameters are reestimated for each item of the INDEXES group The following screenshot illustrates the use of the YTOPDOWN modifier Fh Forecast Pro TRAC Projecto File Settings Operations Pr Project View Window Help TN COGS SO 6E4 1997 1 gt through 2003 Stat Forecast Unlocked COPERTEI EL Brand 3 Project07 Graph Retail TOPDOWN CANS12 BOTTLES KEGSFULL Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins wil perform an out of sample test to select between these two approaches s 140 and for Box Jenkins was 1 The rolling out of sample test used a maximum horizon of 52 and generated 1378 forecasts for ea Based on the lower MAD will use Exponential Smoothing In the example above TOPDOWN directs Forecast Pro TRAC to compute forecasts and confidence limits for the aggregate groups Retail and Commercial at the aggregate level The item level forecasts and confidence limits are multiplicatively adjusted so that the item level forecasts sum correctly to the group level forecasts Forecasts for Brand are obtained by bottom up aggrega
116. astsuvessedadsscsuneseenpencteucedestaenntiacaues 11 Forecasting Methodologies sneri i 13 OME EH One CAST TIP aaa a eee wd a a 15 TUTORIAL General Operations Fhe BASICS osoin aana aaa aa aa aaea Oa Naaah 19 The Marn Men den e E A E 19 AM OVENI W orr a N N eae acento 21 SEMIS TNS DeU Si mea eaqeacodasegsraten dota muaeamuceereawts 21 DEMAS TIE SC be is aactass hen a a a 23 Readies 1 the Dat ais gos scciacisiee e n a a a a kce ee aotiies 24 Generalne Me FP ORCCASIS sie steve acaiitaccoanaesieniwnce cece E 26 Viewing the Forecast REPOM scisectestancidasigeddtassandiausiiecNaansandavenddiaxesootlavmeaass 27 Customizn othe Graph VICW isnin a E enias 29 OVveridins Me Forecasts sorier ea EEE 32 W orkime Wira HOt LSe a 33 Savine HCTF OFC casis saranoina e E N 36 Savno HE Projeti asesors a a aa A 39 Working with Conversions and Alternative Hierarchies sssssssccceesesso 41 TREDE TAU SUAS toasts eae ose aN eae eae setae ee else uas uence ee eee 4 Locked and Unlocked Modosanin a E A 42 Working with Alternative Units of Measure cccceccceeccceeeeeesseseeeeeeeeeaes 43 Chanoines the TACT ACC NY aise cee Gisels since cheawedetepslana E townie siass nace baacesieniaad 44 W Obkine With Oy errid 6 Sets anona n E A E E 45 Updating a Forecast Project sscsiscccocecsacsvas svc scesesessscssiveccosastaescascecsseseseassesuese 49 Defining the Porecastins Proces Sereen a 49 Step One Updating Your Data Piles cssiiwstesdcatadieleadinaniideat
117. ated level Let s illustrate how this works by considering the various steps involved in forecasting our current example Step One Prepare forecasts at all levels 1 e prepare forecasts for Total Camera Film vCamera 1Camera vFormat_Film 1Camera_Film ASA100_BW and ASA100_Color based on their past history Step Two Since the group Camera is being forecasted top down the forecasts of vCamera and iCamera are adjusted proportionally so that they sum to the Camera forecast Step Three Since the group Film is being forecasted bottom up the default the Film forecast is replaced with the sum of the forecasts for vFormat_Film iCamera_Film ASAIOO_BW and ASA100_ Color Step Four Since the group Total is being forecasted bottom up the default the Total forecast is replaced with the sum of the forecasts for Film Camera Bottom up and Top down Forecasting 103 There is one other group modifier INDEXES instructs the program to estimate the seasonal indexes at the group level and use them for all members in the group This is particularly useful when some members of the group have short histories or small demand and seasonal factors are thus difficult to calculate Defining Groups Using Attribute Fields xs resto Camera Company Compatibility Mode r io x Home Insert Page Layout Formulas Data Reviev N View Add ins AbleBits com 9 op es i BD30 f v A B G D E FIGIH J K L M N O P ana 1 Total Product
118. atic Installation Forecast Pro TRAC can be installed as a native 32 bit or native 64 bit application The installation program FPSetup exe will automatically detect the operating system you are running and install the appropriate version Running FPSetup is the recommended way to install Forecast Pro TRAC If you would prefer to use an MSI to directly install the 64 bit version or if you are running a 64 bit operating system but would like to install the 32 bit version you will find instructions for doing so in the next section To install Forecast Pro TRAC on your hard disk using FPSetup perform the following steps Run the FPSetup program as an Administrator The program is located in the root directory of the CD e g D Follow the directions that appear on the screen The installation program will prompt you for your serial number and CD Key These numbers are printed on the CD label and sleeve If you are installing from a download the numbers should have been included with the email that provided the download link Setup will then create the program directory data directories copy the appropriate files create a launch icon on the program menu and place a launch icon on the desktop It will also install SQLite drivers The driver installation launches a separate installation dialog which includes a separate click through license agreement If you have any difficulty installing Forecast Pro TRAC please do not hesitate to
119. available If your support and maintenance contract is up to date product updates are free The Operations Menu The operations menu is used to perform basic program operations Most of the actions can also be performed via icons Operations gt ODBC Connect Operations gt ODBC Connect is used to connect to an ODBC database After selecting this option you will be prompted for the type of database and the database file This option is only available when the data mode is set to ODBC Menu Items and Dialog Boxes 227 Operations gt Script Operations gt Script accesses the Define Script dialog box allowing you to edit the current script This dialog box can also be accessed via the red Script icon Please read the chapter entitled Defining the Script for complete details on the script Operations gt Read Data Operations gt Read Data reads in the data listed on the current script from its primary source This task can also be accomplished using the red Read Data icon p Operations gt Forecast Operations gt Forecast executes the current script file and creates the forecasts This option is only available when a script has been defined and the data has been read in This task can also be accomplished using the red Script icon Operations gt lnitialize Archive Operations gt Initialize Archive is used to generate statistical forecasts for previous forecast periods and to insert them into the Forecast Pro TRAC databa
120. avigator to invoke the context menu and then select Remove Modifier s This will restore the default forecast of zero Right click Product O on the Navigator to invoke the context menu and then select Model gt Very Simple Models gt Fixed Value After ot Set forecasts to after 2011 19 Enter 500 as the Set forecasts to value and set the after date to September 2011 Click OK and verify the forecast is now zero until September 2011 and 500 thereafter Exit Forecast Pro TRAC Forecasting by Analogy In this exercise we ll create forecasts for a new product using a technique known as forecasting by analogy This approach is sometimes also referred to as looks like analysis The concept is a very simple one You are launching a new product and you expect the initial sales pattern to be similar to an analogous product s initial sales pattern or to a launch profile that you ve created To use this method you must supply the launch profile or analog series in the form of a helper variable Helper variables names must start or end with an underbar Helper variables are used in conjunction with event models by analogy models and weighting transformations Forecasting by Analogy 111 If the product has not yet launched 1 e there is no historic data available then you must also supply an estimate of the initial sales over a specific period of time the launch total over the launch horizon Forec
121. avigator until you are comfortable with its operation In the next lesson we ll show you some shortcuts for navigating through complex hierarchies After you have explored the data arrange your display so that it matches the one shown below 24 The Basics 7 Forecast Pro TRAC Project03 aB File Settings Operations Project View Window Help 3 GOE Holdout 0 aa Stat Forecast Unlocked Unts Def 0000000 l though 2011 6 O09 A 3 Total Muffins Stuff Mart gt BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 4 Sids Club 4 Grocery Land Food King Cakes COR 12 11 CASE 12 count Corn Muffins F Project03 Forecast Report Forecast Report for COR 12 11 CASE 12 count Corn Muffins Total gt Muffins gt Stuff Mart gt COR 12 11 Raw hierarchy is Total gt Muffins gt Stuff Mart gt COR 12 11 Are forecast is pending for COR 12 11 mK a COR 12 11 CASE 12 count Corn Muffins SZ Hier 1 2 3 4 _ Loca You probably noticed that after the data had been read in the dialog bar was updated to include the time span of the data and the holdout sample The dialog bar displays the earliest and latest period found for the entire script The ending date is very important If an individual item has data on the ending date the item is active and will be forecasted If an item s history ends prior to the ending date the item is
122. blue Print icon or the Print this page option on the Forecast Report view s context menu You can also save an Excel report for the currently displayed item using the Save this page to Excel option on the Forecast Report view s context menu Tracking Reports Tracking Reports can be saved to Excel You can save these reports for the currently displayed item all items on the Hot List or all items forecasted The Excel workbook will include a separate worksheet for each item These reports are only available if the database includes at least one archived forecast for the given item Each report contains the information found in the current Forecast Report view and optionally the graph found in the current graph view You can specify the format and content of Tracking Reports using Settings gt Tracking Report Settings The operation of the Tracking Report Settings dialog box is described in the Command Reference section of this manual To save a Tracking Report file for all items forecasted select Project gt Export gt Full Tracking Report or click the purple Save Forecast Tracking Report icon 164 Saving Your Work To save a Forecast Report file for the current Hot List select Project gt Export gt Hot List Tracking Report or use the Save Tracking Report option on the Hot List s context menu You can print a tracking report for the currently displayed item using File gt Print the blue Print icon or the Print this page option on th
123. caster or Collaborator licenses to review make changes etc If there is a third individual who needs to review the project that person would do so after the second individual has updated the project Team archives allow you to break large forecasting jobs into smaller pieces that can be worked on separately and then consolidated To implement this approach you construct separate component projects that are all linked to the same Forecast Pro TRAC database the team archive After the component projects have been forecasted and saved the team archive can be opened directly to view and manipulate the consolidated forecast A forecasting process that uses stand alone projects 1s much simpler to implement and maintain than one that uses team archives If it is not essential that your total hierarchy be broken out into smaller pieces then sequential review of stand alone projects is the preferred approach Sharing a Stand alone Project In this lesson we will open a forecast project that was created by someone else review their work and make some overrides Providing a colleague access to your forecast project is a simple way to share your work As long as your colleague has Forecast Pro TRAC Forecaster license or Collaborator license he or she can open the project and continue the session When you save a forecast project Forecast Pro TRAC creates three or four files If the project name is Sample the files are Sample FPProj is the
124. ccecececessssssssoe 81 Command Line Operation ci2 h esaeadincttinteaieiiatidinnine iaaienenemmenautias 8 TUTORIAL Forecasting Operations Usina Forecast ModilierS is csscccesideccascssaesdeessicdessueseecsieviccdecabssedencsesdeeseseesers 87 Specifying Forecast Modifiers for Individual ItemsS ce eeeceecceeeeeeeeeeees 87 Specifying Forecast Modifiers for Multiple Items ce eeeceecceeeeeeeeeeees 89 Specifying Custom Forecast Modifiers ccccceesseseeeceeeeeeeeeeeeseeeeeeeeeeeeeeees 90 Buildin Eyent Models occcacass seks ccosececeadevencavecoeceaatesecudesseucuasstssecsescoeeenaeeeavees 91 Modeling PrOmoOlOns aiauidics tuasindind areal tandeanisiel eucadiasiad A 92 Modeline Week Daerenn a EA 95 Adjustment Tor Outer repii e E E E ONA 99 More Adjustments for Promotions sissisota 100 Building Multiple Level Models c cccccsssssssssscccccssssssssssscccccsssssscsecs 101 Bottom up and Top down Forecasting ccccsseeesseccececeeeeseeeeeeceeeeeeaaeeeeees 101 Defining Groups Using Attribute Fields ecccccccccccsesseeeeeeeeeeeeeeeeeeeees 104 Combining Multiple Level and Event Adjustment Models 000 105 NOM Lived LOGUCIS urner a tacit 106 New Product PF OLeCAaStIN Ossi cicesccessceveoseuecsadascccntoseucsstasecesctasvecssecseeceesausecanes 109 Workime WithiNo Daes a cine Mareen ae lerma tinea ek 109 POreeastin DY ANILO y orias EA EASE 111 Umoe Bass Mode brns a a pete dates 114 Using Weightin
125. ce and vastly simplifies loading previously entered overrides when you update your project Exit Forecast Pro TRAC without saving changes to the Lesson 3 part 2 project This concludes Lesson 3 Working with Override Sets 55 Lesson 4 Collaborating With Colleagues Corporate forecasting often requires collaboration among colleagues Perhaps your manager wishes to review your forecasts and make a few changes Perhaps you want to run your forecasts past the sales force who may know about pending orders Perhaps your business has distinctly different markets that require specific individuals to work on specific markets Whatever the reason it 1s often useful to be able to work with others to establish the final forecasts In this lesson we will explore how Forecast Pro TRAC supports collaborative forecasting Stand alone Projects vs Team Archives There are two different strategies for working with others using Forecast Pro TRAC sharing stand alone projects and linking multiple projects together using a team archive There are pros and cons to each approach Sharing a stand alone project is by far the simplest way to work with others to establish the final forecasts Using this approach the forecaster begins by creating forecasts for all items that need to be forecasted enters any desired 57 overrides and saves a forecast project often to a network drive The project can then be opened by anyone using Forecast Pro TRAC Fore
126. ce limit equal to the value u U must be between 50 0 and 99 9 inclusive Custom Modifier CONF 1 u Set the lower confidence limit equal to the value and the upper confidence limit equal to u must be between 0 1 and 50 0 inclusive and u must be between 50 0 and 99 9 inclusive Custom Modifier LEADTIME n Set the lead time for the safety stock to n The specified lead time appears highlighted in the Safety Stock section of the Forecast Report and determines the values written to the Numeric Output file Fractional entries e g 1 5 are permitted Custom Modifier TIMEFENCE n Set the length of the time fence for the specified item to n Be aware that if you use the TIMEFENCE modifier to create a time fence shorter than the global time fence it will shorten the time fence for all associated parent groups of the item Custom Modifier POW key Use a Box Cox power transformation Key may equal LOG SQRT INVERSE or any decimal number from 1 0 to 1 0 If you enter POW AUTO Forecast Pro TRAC will test your data and implement an appropriate Box Cox transformation or none at all Consult the Forecast Pro Statistical Reference Manual for a discussion of the Box Cox power transformations 184 Using Forecast Modifiers Chapter 5 Command Reference This chapter presents a command overview a description of the user interface a detailed description of each menu command and instructions on how to drive the program from the comman
127. ce section of this manual Item Reports 165 Exception Reports Exception Reports can be viewed on screen and saved to Excel These reports list the items where your forecast error or some other performance metric has fallen outside of an acceptable range Exception reporting reduces the need for manual review of your forecasts and allows you to focus on the items where human attention is most needed To open an Exception Report you select View gt Exception Report or click the yellow View Exception Report icon To save an Exception Report you select Project gt Export gt Exception Report or use the view s context menu Forecast Pro TRAC provides a wide array of exception reports some of which monitor the current forecasts and others which monitor your archived forecasts You can specify the format and content of the report using Settings gt Exception Report Settings The operation of the Exception Report Settings dialog box is described in the Command Reference section of this manual Outlier Reports Outlier Reports can be viewed on screen and saved to Excel These reports list the items where outliers have been detected and or corrected To open an Outlier Report you select View gt Outlier Report or click the yellow View Outlier Report icon 4A To save an Outlier Report you select Project gt Export gt Outlier Report or use the view s context menu The content and format of the report is controlled using the Outlier Report
128. changes from time to time in the contents hereof without obligation of Business Forecast Systems Inc to notify any person or organization of such revision or change Trademarks Forecast Pro is a registered trademark of Business Forecast Systems Inc Other product names mentioned in this manual are trademarks or registered trademarks of their respective companies and are hereby acknowledged Contents GETTING STARTED Belore You BOO easecessssevestacavaveusvsccccecsasecsuevaecackecaaceskeacsceatesssssuseasceekstusaceutents 3 Forecasters and OlADOl ALOLS pasos a T S 3 How TOS Tis Min l ernes tesnaceaiencnn ta oveanee 4 Statistical Reference Manual PDF only cc ceeecssecccecceeeeeeeeeeeeeeeeeeeeeeeees 6 Checking Your Forecast Pro TRAC Package ccccccssseeeceecceeeeeesseseeeees 7 What You Need to Run Forecast Pro TRAC 2 0 eecccccecceceeeeeeseeeeeeeeeeeeaas 7 Registering Your Forecast Pro TRAC Package ccccsseeeseecceeeeeesesseeeeeees 8 Future Development of Forecast Pro TRAC ssssseeessssssssseeresssssssssersssssssseerees 8 Installing Forecast Pro TRAC sccccsccccsssssssssssscccccccccssssssssccccssccssssccsees 9 ATO mmatie Instalan oN sess ea E Aa 9 Manually Installing the 32 bit or 64 bit Version ce eeeceeecceeeeeeeeeeseeeeees 10 A Quick Overview of Forecasting cccccccsssssssssscccccssssssssssccccsscssssssssees 11 What is Statistical Forecasting cas cvssvadsascac
129. chers and Practitioners Norwell MA Kluwer Academic Publishers K Kahn 2006 New Product Forecasting An Applied Approach Armonk NY M E Sharpe S Makridakis S C Wheelwright and R J Hyndman 1998 Forecasting Methods and Applications Third Edition New York Wiley P Newbold and T Bos 1990 Introductory Business Forecasting Cincinnati South Western Suggested Reading 257 Index ANALOG 180 ARIMA 177 BASS 180 BJ 177 CFIT 179 CFIT 179 EXPO 179 GROW 179 LINE 179 QUAD 179 CONST 177 DISCRETE 177 EVENT 93 181 182 EXSM 176 EXSMG 176 181 FIXED 179 FIXEDAFT 179 HOLT 176 INDEXES 104 170 172 183 INTER 178 OUTLIER 182 POW 184 SALY 178 SALYDI 179 SALYDP 179 SALYI 178 SALYP 178 SIMPLE 176 SMA 178 YTOPDOWN 103 105 170 171 172 183 WINTERS 176 XY 177 181 _GROUP 169 1 2 3 139 140 Adjustment mode 222 Allow disaggregation 222 Allow negative forecasts 218 Allow no history 220 Archive forecasts 229 Archive forecasts automatically 227 Automatic recalculation 226 259 Bass Diffusion modifiers 180 Bass Diffusion model 15 114 Bottom up 102 Box Jenkins 14 modifiers 177 By Analogy I11 modifiers 180 Cannibalization 100 106 Cascade 234 Check for updates 235 Close 216 CMAPE 202 Code page 220 Column delimiter 219 Comma delimited files 219 Command line dialog box 223 Command line operation
130. con 7 Use Manual Recalculation By default Forecast Pro TRAC will automatically recalculate the forecasts and re reconcile the hierarchy every time you apply a forecast modifier For large hierarchies this can be time consuming Forecast Pro TRAC allows you turn off the automatic recalculation using an option of the Advanced Controls tab of the Settings gt Options menu If you turn this option off when you specify a forecast modifier the forecasts will not be updated until you click the red Forecast icon This allows you to specify multiple forecast modifiers Speeding Up the Program 251 without having to wait for the program to recalculate the forecasts in between each specification 8 Optimize Outlier Detection and Correction for Speed The outlier detection and correction algorithm will slow down the processing If you wish to use outlier detection and correction but speed is of concern one option is to initially run the forecasts in the detection only mode to detect the outliers and then turn outlier detection off and use the OUTLIER CORRECT modifier to perform the corrections on the detected items 9 Don t Use xlIsx Files If you are using xlsx files you might consider switching to csv or xls files XlIsx files are slower to read than csv and xls files and use over twice as much memory Also if you are using large spreadsheet files breaking them up into several smaller files or increasing the amount of RAM availab
131. contact BFS technical support phone 617 484 5050 email support forecastpro com If you wish to remove Forecast Pro TRAC from your computer use the Add Remove Programs utility in the Windows Control Panel Manually Installing the 32 bit or 64 bit Version As we discussed in the previous section the FPSetup program automatically detects whether you are running a 32 bit or 64 bit operating system and installs the matching version Alternatively you can run either the 32 bit or 64 bit setup program directly The 64 bit installation uses an MSI file called ForecastProTRAC msi which is located in the directory d x64 en us The 32 bit installation uses an InstallShield installation program called Setup exe which is located in the directory d Win32 10 Installing Forecast Pro TRAC Chapter 3 A Quick Overview of Forecasting What is Statistical Forecasting Everybody forecasts whether they know it or not Businesses have to forecast future events in order to plan production schedule their work force or prepare even the simplest business plan Most business forecasting is still judgmental and intuitive Sometimes this is appropriate People must integrate information from a large variety of sources qualitative and quantitative and this is probably best done by using the extraordinary pattern recognition capabilities of the human brain Unfortunately many companies also use judgmental forecasting where they should not
132. d line Operations Overview To prepare forecasts from Forecast Pro TRAC you must follow the following procedure Prepare the database Specify the data format and output options This is accomplished using the Settings menu Options set by the user will apply to the current forecast document and can also be saved to the ForecastProTRAC ini file and used as defaults for all future forecast documents using the Set as Default button Thus you need only set the options when you use Forecast Pro TRAC for the first time or when you wish to change the current settings Create the script The script is a list of the data files to be forecasted It is created using the Define Script dialog box which can be accessed from Operations gt Script or via the red Script icon 9 185 Select Operations gt Read Data Forecast Pro TRAC will then read the data from disk into RAM and display the starting and ending dates for the forecast run on the dialog bar Select Operations gt Forecast The program will then execute the script to prepare the forecasts The forecasts are retained in memory and support the following optional steps Select View gt Overrides to adjust the forecasts and if appropriate reconcile them across multiple levels Select View gt Forecast Report to obtain text reports about individual forecasts Select View gt Graph to view the forecasts graphically Select Project gt Export gt Full Numeric Output to save them to
133. d the distinction between a zero value and a missing value please refer to the Missing Values and Zeros section in the Setting Up Your Data chapter Ignore trailing zeros If this option is selected then trailing zeros after the last nonzero data point will be ignored 1 e the data has ended and the zeros are interpreted as placeholders This means that the time series would be considered dead in multiple level scripts and not forecasted In nonmultiple level scripts the forecasts for the time series would begin after the last nonzero point For a more complete discussion on the handling of missing data and the distinction between a zero value and a missing value please refer to the Missing Values and Zeros section in the Setting Up Your Data chapter Missing Values Specify how you wish the program to treat missing values The options are truncate the data set 1 e discard all data that precedes the missing value impute the missing data or set missing data points to zero Regardless of how this option is set missing values that appear prior to the first data point are ignored For a more complete discussion on the handling of missing data and the distinction between a zero value and a missing value please refer to the Missing Values and Zeros section in the chapter entitled Setting Up Your Data Menu Items and Dialog Boxes 219 Allow no history If this switch is on Forecast Pro TRAC will create a forecast of zero per period for
134. d then select Operations gt ODBC Connect You will be prompted to establish the file data source select an ODBC driver and then to select a database When you invoke the Define Script dialog box the list box to the right includes all tables from your database that do not end with an underbar _ including those that have nothing to do with Forecast Pro TRAC A table from the database is treated just like a file when you are using one of the file data modes Thus you should arrange data into the tables or views that make logical sense as entries in the script Formatting rules ODBC drivers vary a great deal If you experience any difficulties connecting to the database the first thing to check is that you are using the latest ODBC driver available for your database With the exception of the last one which only pertains to Oracle all of the notes below have been verified using Microsoft Access There is a chance that your ODBC driver might be more or less restrictive Missing values are indicated by whatever rules are used by the native database Every database recognizes the distinction between zeroes and missing values If you want you can encode leading and trailing missing values as zeroes In that case you must make sure that Ignore leading zeros and or Ignore trailing zeroes is selected on the Format tab of the Settings Options dialog box Using ODBC 149 Table names and variable names should begin with a letter
135. de at any level of the forecasting hierarchy will automatically reconcile all levels This chapter was written to clarify exactly how the reconciliation is performed and document cases where adjustments cannot be fully implemented due to conflicting overrides or program settings Adjustments Made to a Single Level In this section we will describe how Forecast Pro TRAC reconciles the forecast hierarchy when overrides are made to a single level of the hierarchy Important If you restrict your overrides to a single level of the hierarchy the reconciliation process is simple and intuitive We strongly urge you to limit your overrides to a single level if at all possible 241 Figure 1 below depicts a simple forecast hierarchy prior to any overrides being entered Notice that at this point the Statistical forecasts equal the committed Forecasts Total S 5 F 5 GroupA GroupB S72 S 3 F 2 F 3 ItemA1 ItemA2 ItemB 1 ItemB2 S 1 S 1 S 1 S 2 F F 1 F 1 F 2 Figure 1 Let s now modify the above hierarchy by overriding the forecast for ItemA 1 to equal 75 This results in the hierarchy shown in Figure 2 below Total S 5 F 79 GroupA GroupB S 2 S 3 F 76 F 3 ItemA1 ItemA2 ItemB1 ItemB2 S 1 S 1 S 1 S22 O 75 F 1 F 1 F 2 F 75 Figure 2 Notice that at this point the committed Forecasts for GroupA and Total do not equal the Statistical forecasts If we had started with the hierarchy depicted in Figure 1 and
136. difference is that while January recurs every 12 months an event of type 1 usually recurs irregularly Since Forecast Pro TRAC knows that January occurs every 12 months you don t have to provide that information To implement event adjustment however you must tell the program when events of each type occur To do this you must construct an event variable which classifies each period by event type O no event event of type 1 2 event of type 2 etc The format is the same as that for any other historic data record except that its variable name must begin or end with an underscore _ and its data entries must all be integers The event variable must be defined for each period in the 91 historic record If you want to forecast the effects of future known events you must include these future periods as well For more statistical details please consult the statistical reference for exponential smoothing in the Forecast Pro Statistical Reference Manual In this lesson you will use an event model to capture the relationship between sales of mouthwash and promotions You will also use an event model to capture seasonal patterns in weekly data Modeling Promotions Click the red Script icon 9 and create a script listing Minty Fresh Mouthwash on the first line Click OK to accept the script then click the red Read Data icon to read in the data and finally click the green View Graph icon and use the Navigator to display
137. ds upon the data format However one problem is common to all of the formats the distinction between missing values and zeroes Forecast Pro TRAC ordinarily considers zeroes to be actual data values and treats them as such If they were really intended as missing values then the forecasts can be badly biased Forecast Pro TRAC treats a sequence of leading zeroes as missing values if you check Ignore leading zeroes on the Formats tab of the Settings gt Options dialog box and it treats trailing zeroes as missing if you check Ignore trailing zeroes If you can avoid using this strategy do so Its dependence upon these flag settings makes it a little risky Zeroes in the middle of your data are always treated as numerical values Therefore embedded missing values must be explicitly coded as missing Since the way you do this depends upon the data format it will be addressed as we discuss each specific data format Forecast Pro TRAC interprets your input data and missing values as the data are read Thus you cannot change treatment of missing data for a data set that has already been read except by rereading it from scratch The interpretation of zeros and missing values depends upon the Ignore leading zeroes and Ignore trailing zeroes flags and upon the Missing values setting on the Formats tab of the Settings gt Options dialog box There are three possible settings for missing values Truncate Impute or Zero O
138. e Hierarchy 169 Reconciling the Hierarchy If no group level reconciliation modifiers have been specified a bottom up approach will be used to reconcile the forecasts The procedure operates as follows First Forecast Pro TRAC prepares forecasts for each and every group and item Then it recomputes the group level forecasts by aggregating the constituent forecast bottom up The original group level forecasts are replaced but the width of their confidence limits are retained and re centered on the new forecasts Two group level modifiers can be used to specify alternative reconciliation approaches These modifiers can only be used on group level data TOPDOWN directs Forecast Pro TRAC to perform top down reconciliation for all members of the indicated group This procedure begins by preparing forecasts for each and every group and item Then it proportionally adjusts the nested lower level items and groups forecasts to sum to the TOPDOWN group forecast If the YTOPDOWN group is itself nested within larger groups the forecasts for the larger groups are computed by the bottom up approach An example of top down reconciliation is given below You cannot define a TOPDOWN group as a member of another TOPDOWN group INDEXES directs Forecast Pro TRAC to calculate the seasonal indexes at the indicated group level and use them to deseasonalize the histories for the nested items and groups The deseasonalized series are then forec
139. e Output Files section allows you to specify the output files to generate when the project is run from the command line The format and content of these files will match the current project s settings Make sure your settings match the ones above Click the OK button to save your selections Click the red Script icon and define a script consisting of the single line 123 Bakery 82 Operating From the Command Line Click OK to accept the script and then select File gt Save to save the project Name the project Test Exit Forecast Pro TRAC We will now run the project from the command line Select Run from the Windows Start Menu Execute the program including Test FPProj as a parameter followed by b If you installed Forecast Pro TRAC into a directory named C Program Files Forecast Pro TRAC v2 the command line should read including the quotation marks C Program Files Forecast Pro TRAC v2 ForecastProTRAC exe Test FPProj b After issuing the command the program will execute the script and create all of the requested output files Examine your output directory to confirm the files were created For more detailed information regarding command line operation consult the Reference section of this manual This concludes Lesson 8 Command Line Operation 83 TUTORIAL Forecasting Operations Lesson 9 Using Forecast Modifiers In the very first lesson you prepared forecasts using expert selection Foreca
140. e Tracking Report view s context menu You can also save an Excel report for the currently displayed item using the Save this page to Excel option on the Tracking Report view s context menu Item Reports Item Reports can be viewed on screen and saved to Excel These reports can contain Pareto information statistical output such as the forecasting model specification and summary statistics as well as time series output such as history forecasts fitted values and confidence limits To open an Item Report you select View gt Item Report or click the yellow View Item Report icon O To save an Item Report you select Project gt Export gt Item Report or use the view s context menu You can specify the format and content of the report using Settings gt Item Report Design The operation of the Item Report Design dialog box is described in the Command Reference section of this manual Override Reports Override Reports can be viewed on screen and saved to Excel These reports list the items where overrides and or comments have been made To open an Override Report you select View gt Override Report or click the yellow View Override Report icon 4 To save an Override Report select Project gt Export gt Override Report or use the view s context menu You can specify the format and content of the report using Settings gt Override Report Design The operation of the Override Report Design dialog box is described in the Command Referen
141. e are any defined When using the Show all option the report will display the MAPE and the MAD rather than just the specified threshold statistic Exception Report Setting Oo O c Forecasts vs History Forecast Range Fated Eror Archive vs Actual Forecast Archive Waterfall Historical periods to consider The Archive vs Actual report compares an archived forecast 1 e a forecast you prepared in the past to what actually happened The Historical periods to consider section allows you select how many historic periods to monitor Setting Periods to monitor to 1 will monitor the most recent historic value only Setting Periods to monitor to 2 will monitor the most recent historic value and the period prior etc The Allowable deviation from history section allows you to set the sensitivity of the exception thresholds Item level thresholds allow you to assign different sensitivities to different items The item level thresholds must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section of this manual Global thresholds use the same thresholds for all items 208 Command Reference The Comparison basis section allows you to set whether you want the thresholds to use percent or units to specify a lead time or archive period to use and to base the comparison on either the final forecast which potentially includes user adjustments or the
142. e been withheld then you obtain 6 1 step forecasts 5 2 step forecasts 4 3 step forecasts etc The model coefficients are not reestimated as each additional data point is assimilated The forecast model is based entirely upon the original fit set Setting Up the Script for Evaluation Forecast Pro TRAC is shipped with data files containing the 111 series from the original M competition Annual contains 20 annual series Quarterly contains 23 quarterly series and Monthly contains 68 monthly series In this lesson we will compare the out of sample performance of two different forecasting techniques using the monthly data set The main idea of this facility in Forecast Pro TRAC is to give you the opportunity to test options for time series from your own company This lets you tune Forecast Pro TRAC to your data Click the red Script icon and on the first line enter M data Monthly Accept the script and then click the red Read Data icon to read in the data Set the holdout sample on the dialog bar to 6 Click the red Forecast icon to create the forecasts 128 Out of sample Testing Examining the Analytic Output After processing is complete select the group Monthly on the Navigator and view the Out of Sample Rolling Evaluation for Items in Group section of the Forecast Report view 5 Forecast Pro TRAC Proj oc oS File Settings Operations Project View Window Help 0066556640655 084 400008 Stat Forecast Unlocked 1 through
143. e very bad Include the fitted values on the graph This 1s accomplished by toggling on Fitted on the graph s context menu Notice that the model predicted several peaks that did not occur as well as missing several that did The model is trying to capture the peaks as part of the seasonal pattern However the promotions that caused these peaks did not always fall in the same months and thus cannot be modeled using a seasonal model Select _PriceSpecials on the Navigator File Settings Operations Project View Window Help Py Py Fo gt lt j a 00606655 664 016 4 6 0 4S OOO8S 2007 1 gt through 2011 9 gt Holdout 0 gt Units Stat Forecast Unlocked Total MintyFresh24 MintyFresh32 Helpers F Project03 Graph _PriceSpecials is an event variable _PriceSpecials takes the value of zero when MintyFresh24 and MintyFresh32 are not promoted and the value of one when they are Notice that the series includes the promotional schedule for the forecast period When you use _PriceSpecials to build an event model an adjustment will be included for the promoted months any variable whose Modeling Promotions 93 name begins or ends with an underbar is recognized as a helper variable and will not be forecasted _PriceSpecials reflects the simplest type of event variable Each month is coded either as promoted 1 or not promoted 0 At times you may have more than one type of event
144. eans Business Forecast Systems Inc 68 Leonard Street Belmont MA 02478 USA the author and owner of the copyright of this computer program product B Computer means the single computer workstation terminal or other digital electronic device on which You use this program C Software means the set of computer software programs in this package regardless of the form in which You subsequently use it D Licensee means an individual or single entity exercising rights under and complying with all the terms of this EULA In the remainder of this EULA the Licensee is referred to as You E Authorized User means the Licensee in the case where the Licensee is an individual In the case where the Licensee is an entity Authorized User means 1 an employee of the Licensee but only while such employee is acting within the scope of such employee s employment by Licensee and 11 the primary user of the Computer on which the Software is installed If You do not agree with the terms of this EULA BFS does not grant any license to the Software and You should not download install or use the Software In such event that You do not agree with the terms of this EULA and have already installed or downloaded the Software You must remove the Software from your Computer and return to BFS the complete software package including disks and printed materials and destroy all copies or 1f You downloaded the Software no
145. ear gt Plus Delta Increment SALYDI Set each forecasted value to equal the value for the same period last year adjusted by the unit change between the value for the same period last year and the same period two years ago Model gt Very Simple Models gt Fixed Forecast Value F XED n Set each forecasted value to n Forecast Fixed Value After B LW mesm Set forecasts to after 2003 ETE Model gt Very Simple Models gt Fixed Forecast Value After FIXEDAFT Year Period n Set each forecasted value which falls after the year and period specified to n Curve Fitting Models gt Curve Fit gt Automatic CFIT Use the curve fitting routine that minimizes the BIC over the historic data Models gt Curve Fit gt Straight Line CFIT LINE Fit a straight line to the data set Models gt Curve Fit gt Quadratic CF T QUAD Fit a quadratic curve to the data set Models gt Curve Fit gt Exponential CF T EXPO Fit an exponential curve to the data set Models gt Curve Fit gt Growth Curve CFIT GROW Fit a growth curve to the data set Model Specification Modifiers 179 Bass Diffusion Model gt Bass Diffusion BASS Use the Bass diffusion model with automatically generated coefficients Model gt Bass Diffusion BASS p g m Use the Bass diffusion model with user defined coefficients p q and m By Analogy Model gt By Analogy ANALOG X Use the by analogy model with automatic calculation of the launch total _X is the n
146. ecast Pro TRAC will automatically save all changes to the TRAC database every time you save your forecast project For large hierarchies this can be time consuming If you turn this option off saving your projects will be much quicker however if you want to archive your forecasts for tracking purposes you will need to do so explicitly using Operations gt Archive forecasts or the blue Archive Forecasts icon Use SQLite If this option is selected Forecast Pro TRAC will save the project s database file as a SQLite file with the extension db If you are running the 64 bit version of Forecast Pro TRAC this option will always be selected and greyed out on the dialog box 1 e you can t change it If you are running the 32 bit version of Forecast Pro TRAC and this option is not selected Forecast Pro TRAC will save the project s database file as a Microsoft Access file with the extension TRAC The setting can only be changed on a new project prior to reading in the data You can change the default for new projects by setting this option and then selecting the Default button If you are using the 32 bit version of Forecast Pro TRAC you can also convert existing projects that use Microsoft Access to ones that will use SQLite using the menu option Operations gt Convert to SQLite Check for product updates automatically If this option is selected Forecast Pro TRAC will periodically check online for product updates and alert you if they are
147. ecasts each planning period Depending on the complexity of your forecasting process and the number of individuals involved it may be useful to document the decisions made and the steps required to update the forecasts each planning period Step One Updating Your Data Files Consider the following situation We work for the 123 Bakery We have defined an extremely simple forecasting process where the forecasts are generated and adjusted by one individual All adjustments are made to the SKU level data in base units and in the base hierarchy The projects are saved with the statistical forecast unlocked 1 e we never change states It is early June 2011 and we have historic demand data that starts in 1 2006 and ends in 5 2011 Thus our first forecast period will be June 2011 We use Forecast Pro TRAC to create our forecasts and then we save a forecast project named Lesson 3 June 2011 Now imagine that a month passes by We now have our sales figures for June and we update our historic data files This is accomplished externally to Forecast Pro TRAC It may entail running a data extraction routine to generate the new files updating your spreadsheets by hand or some other process to update the historical data files 50 Updating a Forecast Project Step Two Opening Your Forecast Project Start Forecast Pro TRAC select File gt Open and select the project Lesson 3 June 2011 The dialog box below appears cono M Your
148. ection and views are immediately updated to match your selection Right click in the Hot List area to call up the Hot List s context menu Notice that there are a full range of options to control how Hot List items are displayed and to remove items Select Clear to clear the Hot List 34 The Basics Forecast Pro TRAC Pr File Settings Operations ew Window Hel 060655664068 62 0e4 000006 Stat Forecast Unlocked 1 through 2011 gt 6 gt Holdout 0 Units Defauk Xj 3 Total F Project03 Graph olols 3 Muffins eo 3 Sige COR 1 Add to Hot List This Item X 123 Bakery Inc BRA 12 M Incl Children Stuff Mart Customer odel BLU APP 12 siey OAT 1 3 Sids Club stlier COR 1 Custom Modifier This Level BRA 12 E R BLU 12 TT APP 12 Apply Modifier s To Incl Siblings Related End items This Plus Parent Levels This Level A a a a A COR I Top Down Analysis BLU 12 Indexes 3 Food King Expand All COR 1 Collapse All BLU 12 Expand All To Current 3 Cakes Hierarchy ST 20 02 s gt Stuff Mart Total gt Muffins gt Stuff Mart gt COR 12 11 Total gt Muffins gt Stuff Mart gt BRA 12 11 Total gt Muffins gt Stuff Mart gt BLU 12 11 P 12 1 e A OAR 2006 Jan 2007 Jan 2008 Jan 2008 Jan 2010 Jan 2011 Jan 2012 Jan HE History MM Forecasts MMM Forecast Interval Add this item Hier 1 2 3 4 2 Local Now select Total gt Muffins g
149. eet by giving it the range name BFSDATA In a multi worksheet workbook the data are assumed to reside in the first topmost worksheet unless an alternate sheet has been specified by naming it BFSDATA The cell references in the examples below assume that the entire worksheet has been devoted to the Forecast Pro TRAC database If you opt to specify a named range cell Al in the samples will correspond to the cell in the uppermost left corner of your named range Row format If your data are already stored by rows you will want to consider the row format first You can probably alter your spreadsheet to the Forecast Pro TRAC row layout in just a few minutes In row format each time series occupies a single row on the spreadsheet The data are assumed to reside in the topmost first spreadsheet in the workbook unless an alternate sheet has been specified by naming it BFSDATA Row 1 of the spreadsheet is devoted to column headings The keyword description must be used as the column heading for the description column The other cells in row 1 are ignored by Forecast Pro TRAC You can use them for titles calendar information etc Here is an example of a row format spreadsheet Spreadsheet Formats 141 Ox HD S SKUs manual XLS Compatibility Mode Microsoft Excel Home Insert Page Layout Formulas Data Review View Add Ins 5x ix 1 lt ike z 3 T amp Ata J0 ea alo S General C
150. elated components on and off Select the Components tab 30 The Basics Type 123 Bakery Inc into the Title field and click the Apply button Notice that the title has been added to the graph Clicking the Apply button implements your current selection without leaving the Graph Settings dialog box Clicking OK implements your current selection and exits the dialog box Forecast Pro TRAC supports two types of graphs time series and year over year Select Year over Year Notice that the titles that we had specified for the time series graph have disappeared Select Time Series Notice that the titles are back Because the graph types are distinctly different Forecast Pro TRAC maintains their formatting separately When you are viewing a time series graph you have the option of displaying all of the data in a nonscrollable display or zooming in and graphing a subset of the data Remove the check from the All option and click OK Notice that the graph now displays 36 data points and 1s scrollable Use the horizontal scrollbar to scroll through the display S tm Return to the Components tab of the Graph Settings dialog box select AI and click Apply Then move to the Layout tab The tab allows you to select the graph style you wish to display and choose custom line colors and widths Experiment with the settings After you are comfortable with their operation edit the settings so t
151. ellow A red Navigator icon signifies that an override has been made to the item If a group icon appears in yellow it signifies that an override has been made to a variable lower down that branch of the hierarchy When you make an adjustment to an item in a hierarchy Forecast Pro TRAC will automatically reconcile the entire hierarchy to reflect the change Thus when we made our override to Total gt Muffins gt Stuff Mart this impacted the groups above our selection and all groups and items below our selection The Reference section of this manual describes how the reconciliation 1s performed Important If you restrict your overrides to a single level of the hierarchy the reconciliation process is simple and intuitive We strongly urge you to limit your overrides to a single level if at all possible We have illustrated the basics of the override facility There is a considerable amount of additional functionality including the ability to associate comments with override cells the ability to add and remove override rows the ability to name override rows the ability to make overrides on the graph using your mouse the ability to enter overrides as formulas the ability to view the history and the ability to make incremental adjustments to the Statistical Forecast row rather than overriding the values All of this functionality is described in the Reference section of this manual Turn off the Override view by clicking its green icon W
152. elp gt Statistical Reference PDF accesses a pdf version of the Forecast Pro Statistical Reference Manual Help gt Check for Updates Help gt Check for Updates will check online to see if you are running the latest release of the program If a product update is available you ll receive a message alerting you to this fact with instructions describing how to receive the update If your support and maintenance contract 1s up to date product updates are free Help gt About Forecast Pro TRAC Help gt About Forecast Pro TRAC displays the Forecast Pro TRAC version number and copyright notice Working with Team Archives Team archives allow you to break large forecasting projects into smaller pieces that can be worked on separately and then reassembled into consolidated forecasts For example suppose three demand planners are responsible for forecasting three different geographic territories they would like to work on their territory forecasts separately and after they are complete view and manipulate a consolidated forecast team archives allow you to do this The procedure is as follows 1 Create the initial component project for the first territory and use Project gt Team Archive gt Send to to convert the stand alone project to a Working with Team Archives 235 linked project and to name the team archive database file It is important to note that the settings for forecast horizon confidence limits percentiles number of overr
153. emA2 Therefore the forecast for GroupB becomes 350 Examples Where Overrides Cannot be Allocated If you make forecast overrides to more than one level of the hierarchy you can generate situations where the overrides cannot be allocated In these instances an error message will be displayed and the override will not be applied Figure 7 below depicts a forecast hierarchy where ItemA1 and ItemA2 have both been overridden to equal 75 and ItemB1 has been overridden to equal 150 Examples Where Overrides Cannot be Allocated 245 Total F 302 GroupA GroupB S 2 S 3 F 150 F 152 ItemA 1 ItemA2 ItemB1 ItemB2 S 1 S 1 S 1 S 2 O 75 O 75 O 150 F 2 F 75 F 75 F 150 Figure 7 Suppose you try to override the forecast for GroupA to equal 100 The override could not be applied because both ItemA1 and ItemA2 are locked Forecast Pro TRAC will display an error message and reject the override Let s now modify the above hierarchy by overriding the forecast for GroupB to equal 50 This results in the hierarchy shown in Figure 8 below S 5 F 200 GroupA GroupB S 2 S 3 F 150 O 50 F 50 ItemA1 ItemA2 ItemB1 ItemB2 S 1 S 1 S 1 S 2 O 75 O 75 O 150 F 100 F 75 F 75 F 150 Figure 8 Notice that the override for GroupB resulted in a negative committed Forecast for ItemB2 This result assumes that the Allow Negative Forecasts setting in the Forecast Pro TRAC Options dialog box was selected If this setting was not selected
154. ent variables and forecast components displayed The nclude section allows you to toggle on or off various components of the graph If the Show Ancestry option is selected and the variable name is displayed on the graph the variable name will appear preceded by any applicable parent group names ns s gt Stuff Mart s gt Stuff Mart gt COR 12 11 s gt Stuff Mart gt OAT 12 11 s gt Sids s gt SidsOlub gt COR 12 11 s gt Sids Club gt APP 12 11 al gt Muffins Land gt s gt Grocery Land gt COR 12 11 n BB inan gt Meannan I aand a OIII 19 The Items tab allows you to choose up to five variables you want to graph The Override Forecasts View 197 The Override Forecasts View The override view is used to enter overrides to the statistically generated forecasts Changes made at any level of the forecasting hierarchy will automatically reconcile all levels Refer to the Understanding How Forecast Overrides are Allocated chapter for a discussion on how the reconciliation is accomplished Up to ten override rows can be used and you can adjust the forecasts using percentages increments or by typing in new values You can also enter comments for any cell on the display There is an Overrides tab on the Settings gt Options dialog box that allows you to control the document level options including how overrides should be applied replacement values vs incremental adjustments and the precision of the display Thi
155. eport Graph Override Forecasts Tracking Report and Tracking Graph are context specific meaning that the contents displayed in these windows will match the current Navigator selection and update automatically as you move about the Navigator The context specific views all have green icons The remaining four views Item Report Exception Report Override Report Outlier Report and Preview Numeric Output are global 1 e their contents pertain to all items forecasted and are independent of the current Navigator selection The global views all have yellow icons A description of each of the views appears below The Status bar As you use Forecast Pro TRAC the status bar displays relevant information The Forecast Report View The Forecast Report view is a scrollable text display containing information about the forecasts and how they were generated In addition to providing a convenient way to view information while using Forecast Pro TRAC the Forecast Report view is also used to design the text section of the formatted forecast reports that are output to Excel The Forecast Report Design dialog box allows you to customize the Forecast Report view This dialog box is invoked by selecting Settings gt Forecast Report Design or by selecting Forecast Report Design from the Forecast Report view s context menu The Forecast Report View 193 rc eon Oy i Include Historic Data Forecast Data Within Sample Out of sample Stats
156. eport icon to open the Exception Report window Your display should now match the one below 15 Cr SES File Settings Operations Project View Window Help 066556566645 06S e446 OOO BS 1 gt through 2011 gt 6 Holdout 0 Units Default zj Stat Forecast Unlocked 2006 Total Fh Lesson 7 Exception Report Forecasts vs History a pipet na r iation Deviation Stat Forecast gt IZTETET ota Muffins COR 12 11 2011 Jul 05 i 83 79 BRA 12 11 BLU 12 11 APP 12 11 2011 Jul r S i 55 04 APP 12 11 7 ol es VA 20 01 2011 Jul v 76 05 OAT 12 11 i ota akes CH 20 01 2011 Jul 5 78 61 3 Sids Club otal s uff Mart CA 20 01 2011 Jul z y i 5 53 64 COR 12 11 otal akes BU 20 02 2011 Jul y f g 7 52 75 BRA 12 11 ota VA 20 01 2011 Jul 8 66 53 p eaen ota akes CA 20 01 2011 Jul 6 185 52 14 APP 12 11 Grocery Land COR 12 11 BLU 12 11 APP 12 11 3 Food King COR 12 11 BLU 12 11 APP 12 11 NULL 2011 Jul 3 60 58 COR 12 11 CASE 12 count Corn Muffins LF 20 02 2010 Jan 2011 Jan MMB Forecasts MM Forecast Interval XZ Hier 1 2 3 4 _ 9 Loca COR 12 11 CASE 12 count Corn Muffins Notice that the window is labeled Forecasts vs History This report is comparing the July forecast to the historic value for the previous July and is flagging any cases where the change is greater than 50 The first four columns of the report ident
157. ere are any defined In place only restricts the display to the current in place override set only Thus override sets made in previous states e g in other units and or hierarchies will be omitted as will override sets made for other origins e g previous forecast periods and override sets associated with other linked projects Current origin amp current project displays all override sets for the current project and current origin forecast period Thus override sets made in other states e g in other units and or hierarchies will be included however override sets associated with different forecast origins e g previous forecast The Override Report View 211 periods and override sets associated with other linked projects will be omitted Last origin amp current origin displays all override sets for the current and immediately previous origin forecast period This is often a useful display to view when you have updated the statistical forecasts and are loading override sets from the last forecast period via Project gt Import gt Archived Overrides Custom provides complete control over the override sets displayed Compatible series restricts the display to override sets where the state e units of measure and hierarchy match the current state Headers only displays the one line header for each override set omitting the item level override information The Forecast origin option allows you to specify the range of o
158. erview section at the beginning of this chapter for more details on these items The time series data begin in row 7 The starting year row 3 and starting period row 4 refer to the year and period for row 7 whether or not that cell actually contains data Thus in the example spreadsheet the first value for PG1 204 2 is for January 2003 in row 9 even though the header defines the starting period as 11 and the starting year as 2002 Formatting rules Keep the following points in mind when you are creating your spreadsheet If you are not using attribute fields each variable name must be unique If you are using attribute fields each variable name within a given group must be unique If you use zeroes to pad the data prior to an item s availability make sure that Ignore leading zeros is selected on the Formats tab of the Settings Options dialog box 144 Setting Up Your Data Text MLT Formats A multivariate text file contains information for all the series you wish to forecast from a single line of the script file This file is stored as an editable text file with the extension MLT You must create this file outside of the program making sure that you format it appropriately The MLT file format is straightforward The file begins with record headings followed by a semicolon The record headings are required for the Variable Name and Description fields and are optional for all other records You can use them for titles calend
159. etting in the Historical periods to consider section controls how many historic periods to monitor Our current setting of one will only monitor the most recent historic data point June 2009 in our example The Lead time and Archive period settings are only relevant if you are monitoring more than one historic point They allow you to compare each historic point being monitored to either the corresponding forecast for a specific lead time or to forecasts made at a specific archive period 1 e forecast origin 78 Exception Reporting Select the Waterfall tab and click Apply This report compares the cumulative Statistics for the specified lead time from the current waterfall report to the specified thresholds Experiment with the exception reports until you are comfortable with their operation When you are finished exit the program without saving changes to the Lesson 7 project This concludes Lesson 7 Monitoring Archived Forecasts 79 Lesson 8 Operating From the Command Line When the command line to execute the program includes a project file FPProj and the b parameter Forecast Pro TRAC will read the project create the forecasts save all output files and then exit This feature is particularly useful when you are integrating forecasting with other software systems and desire a hands off approach Command Line Operation In this lesson we will first use Forecast Pro TRAC interactively to create a
160. example our first attribute field is Total Notice that the value for the field Total is Total for all items Since all items have the same value for the first attribute field when we read this spreadsheet into Forecast Pro TRAC the first level of our forecasting hierarchy will provide a grand total for all items in our spreadsheet Notice that the next attribute field is Category which contains both Muffins and Cakes Thus when we read this spreadsheet into Forecast Pro TRAC the second level of our forecasting hierarchy will breakdown total sales into Muffins and Cakes The next attribute field is Customer Thus the third level of our forecasting hierarchy will breakdown the Muffins and Cakes into Customers The next field is the Variable Name labeled SKU so the final level of our hierarchy will breakdown the Category by Customer into SKUs The order of appearance on the spreadsheet dictates the structure of the hierarchy so you Il want to take care when constructing your spreadsheet Often this entails sorting your spreadsheet on the attribute fields prior to reading it into Forecast Pro TRAC If you use a pivot tables in Excel to create your input files the resulting spreadsheet will only include records in the attribute fields when the attributes change Thus the data in our example would be represented as shown below Using Attribute Fields to Define a Hierarchy 151 ea Ni aie Bakery Compatibility Mode Microsoft Exc
161. f fit to your historic data and model complexity To do this will require experimentation and monitoring of actual model performance Example I A promotion in say September may have effects in August and October as well Buyers may delay purchases in August and they may be overstocked in October You can code the pre and post promotional effects as event types of their own These events will of course be associated with decreases in sales Example 2 Sometimes one SKU of a brand or product line is promoted but closely related SKU s are not The result may be that the promoted SKU cannibalizes the sales of the other SKUs You can treat this effect by coding cannibalization events for these SKUs But be cautious Overuse of this technique will result in an overly complex model and possible deterioration of forecast performance This concludes Lesson 10 100 Building Event Models Lesson 11 Building Multiple Level Models In this lesson you will learn how to define group variables and prepare multiple level forecasts Bottom up and Top down Forecasting Start the program click the red Script icon and select Presto Camera Company Accept the script read in the data forecast the data open the graph view and fully expand the Navigator Your screen should now look like the one shown below 101 F3 Forecast Pro TRAC Project 4 File Settings Operations Project View Window Help 0000000 0a o vaoo Stat Forecast Unloc
162. f you had 1 000 items and you set the A group to 100 the B group to 200 and the C group to 700 the 100 highest volume items would be assigned to group A the next highest 200 items would be assigned to group B and the remaining 700 would be assigned to group C Series Count This option allows you to assign a specified percentage of the total number of items you have to each group For example if A is set to 20 B is set to 50 and C 1s set to 30 Forecast Pro TRAC will first rank all of the items from highest volume to lowest volume and then sequentially place the top ranked items into the A group until the number of A group items equals 20 of the total number of items It will then sequentially place items into the B group until the number of B group items equals 50 of the total number of items The remaining items 30 of the total number of series are assigned type C Group zero volume If this option is on then any items having zero volume will be placed into group D Menu Items and Dialog Boxes 225 Forecast Pro Software Assurance Check for product updates automatically The Advanced Controls tab allows you to set expert selection options control the timing of some program operations and adjust how frequently Forecast Pro TRAC checks for program updates Adjusting the expert selection and performance options can improve processing speed for forecasting applying forecast modifiers and saving projects Exclude ARIMA
163. for these graph types separately The Labels section allows you to define labels for the X and Y axis and add titles to the graph The include variable name option will use the variable name followed by the description as the graph s subtitle The Clear button erases the current labels The Y Axis Scale section controls the scaling Automatic allows Forecast Pro TRAC to select the Y axis scale 196 Command Reference Custom lets you set the minimum and maximum for the Y axis scale Include zero begins the y axis at zero or at the minimum negative value Relative scaling is only relevant when you are graphing more than one variable If it is on each variable will be displayed on its own scale If it is off all variables will be displayed on the same scale It is important to know whether relative scaling is on or off when you interpret the graph Gaph Sens ne Include Components Layout tems Style Line Colors and Widths Line Variable 1 3 D line Column 3 D column Variable 3 Variable 2 Variable 4 Include V Grid lines 7 Legend Forecasts Variable 5 Show points Confidence limits Show Ancestry Corrected history AGRE RARE ITT TT Stat forecasts Set as Default Cox cence Most of the options in the Layout tab are self explanatory The Style section allows you to set the graph style The Line Colors and Widths section allows you to specify the line colors and widths for the differ
164. g Transformations eeesccssssseceeeoccsssscececcoosssssceeoocsssssseee 117 Adjusting for 4 vs 5 Week Periods ccccccssssssseccccccceesseeccceeeesaaeessseeeeees 117 Other Uses for Weighting Transformations ccccccccccceesssseeeeeeeeeeeeeeeeees 120 Detecting and Correcting Outliers sccsssssssscccccsssssssssssccccsscsesssssees 121 How Outlier Detection and Correction Works cccccccccsseeeeeeeeeeeeeeeeeeees 122 Reviewing the Outer s ctic ors stsvcscizdes ent cave a 123 Coprectime the OUTS ereen 124 Out of sample Testini sesiscssccscscsavesctscsessceasssacecssecanesacevscensscnacosassageoasonseonses 127 setting Up the Script Tor Evaluation sssi nean iN E SERE 128 Examining the Analytic Output cccccccsssssssseecccccceeeesseeeccessaneesseeeeees 129 Comparing an Alternative Model cccccccccccsssseeeeeceeceeeeeeeseeeceeeeeeaeeeenees 130 REFERENCE Setting Up Y OUP DACA cssssiscasaistasacsawccassadeccssdeestiaasncatesassaecueasaeeuseesteteaasaaaanss 135 ON ta a ere a en re ne oe S S A E ere E 135 Selectine a Data POmnatisicantaece asda taseiyaneudiadtaetiaieaaeneeRAaatndiautd 139 Spreadsheet Formals osere e A tua nieeil 140 FXE METI TOMA E en a a E RS 145 C ne ODBC aora E E E E E Sere ne anata 147 Using Attribute Fields to Define a Hierarchy nneesssseennsssssssssserrsssssssee 150 Detinine the Secondary Pile t ccstiiodionrtrusiaciaainirtingeissaodsenmtiualsaieaini
165. g you to switch between the Custom style and one or more of the standard styles without having to reset your custom settings Important note The Custom option allows you to set the numeric precision for the within sample statistics These precision settings are used for both Custom and standard report styles 194 Command Reference The Graph View The graph view is used to display variables and forecasts graphically In addition to providing a convenient way to view the forecasts while using Forecast Pro TRAC the graph can also be included in the formatted forecast reports that you save to Excel The format and content of the formatted forecast report s graph will match the current settings for the graph view File Settings Operation View Win 0006 5 508 4 0 69 amp Be ee 0000906 Stat Forecast Unlocked 1 3 Total Muffins Stuff Mart COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 3 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 Grocery Land COR 12 11 BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 Cakes 3 gt Stuff Mart VA 20 01 ote Muffins gt Stuff Mart gt COR 12 11 Total gt Muffins gt Stuff Mart gt BRA 12 11 Total gt Muffins gt Stuff Mart gt BLU BM Total gt Muffins gt Stuff Mart gt APP 12 1 Total gt oe bore Mart gt OAT 12 HY Total gt Muffins gt gt Sids Cub gt gt BRA 12 11
166. gt Expert Selection no modifier If an item on the Navigator does not contain a modifier then Forecast Pro will use its expert selection algorithm to automatically select the appropriate forecasting method If an item on the Navigator does contain one or more modifiers and you select Model gt Expert Selection the modifiers will be removed and Forecast Pro will use its expert selection algorithm to automatically select the appropriate forecasting method Exponential Smoothing Model gt Exponential Smoothing gt Auto EXSM Use the automatic fitting exponential smoothing model Model gt Exponential Smoothing gt Simple S MPLE Use the simple exponential smoothing model Model gt Exponential Smoothing gt Holt HOLT Use the Holt exponential smoothing model Model gt Exponential Smoothing gt Winters WINTERS Use the Winters exponential smoothing model Exponential Smoothing Model Setti e Cancel Hep Model gt Exponential Smoothing gt Custom EXSM XY Use a custom exponential smoothing model with trend type X N no trend L linear trend D damped trend E exponential Forecast Pro decides seasonality type Y N nonseasonal M multiplicative seasonal A additive seasonal Forecast Pro decides and optimized smoothing weights 176 Using Forecast Modifiers Model gt Exponential Smoothing gt Custom EXSM XY A B C D Use a custom exponential smoothing model with trend type X N no trend L linear trend D damped
167. h a category for promoted months then your model would include an adjustment for promoted months If you ran three different types of promotions you could establish three categories and have a different adjustment for each type of promotion Forecasting by Analogy is a new product forecasting technique that allows you to create a forecast that looks like a different product s demand pattern or a launch profile that you create 14 A Quick Overview of Forecasting Bass Diffusion Model is a new product forecasting technique designed to forecast the spread of a new technology product or method based on the adoption rates of two types of users innovators who are driven by their desire to try new products and imitators who are primarily influenced by the behavior of their peers If you are new to forecasting and these techniques seem a little intimidating don t worry We designed Forecast Pro TRAC to guide you completely through the forecasting process Just follow the program s advice all the way to accurate forecasts Some Forecasting Tips Forecast Pro TRAC uses the history of your data to forecast the future Thus it is extremely important that your data be as accurate and as complete as possible Keep in mind the rule Garbage in garbage out You will also want to give some thought to what data you should forecast If you want to forecast demand for your product you should probably input and forecast incoming orders rather
168. h total to equal 500000 Check the boxes for Launch horizon and Launch date Notice that the default Launch horizon is set to 12 the length of the data plus the forecast horizon and that the default Launch date is July 2010 the first forecast point Click OK to build the model Examine the output Notice that the forecast now reflects the shape of the analog variable 112 New Product Forecasting Now we will use the By Analogy method to prepare forecasts for the same product after we have 3 months worth of history Right click Product 3 on the Navigator to invoke the context menu and then select Model gt By Analogy Select _Profile 1 as the analog variable by clicking on it Select Launch horizon and set the number of periods to 12 The dialog box should now look like the one below Now that we have some historic data Forecast Pro TRAC 1s able to fit the Analog model and calculate the estimated launch total from the historic demand The estimated launch total predicts that at our current rate we will sell 364 960 units during the Launch horizon the first 12 months in our example This is substantially less than the 500 000 units our market research predicted Select Specified launch total and set it to 500000 Click OK to build the model Right click on the Graph view to invoke its context menu Add the fitted values to the graph by selecting Fitted Yj Forecast Pro TRAC Ps File Settings Operations Project View Windo 000605
169. h view to invoke its context menu and select Graph Settings Open the Components tab remove the checkmark for All set Periods to 156 and click OK Note that the display is now scrollable Periods allows you to select how many data points will be shown on screen when the All option is not selected Add the fitted values to the graph using the graph s context menu 96 Building Event Models One noticeable feature of this data set is that sales for the weeks containing the three US summer holidays Memorial Day 4th of July Labor Day are higher than other weeks If you look closely at the data you Il notice that these holidays sometimes change weeks and when this occurs the fit can be poor For instance the 4 of J uly fell in week 27 before 2008 but fell in week 28 in 2008 and thereafter The fitted value for week 27 in 2008 exhibits a strong peak and misses the actual holiday peak that fell in week 28 Forecast Pro TRAC used a standard Winters model to forecast C 6 This model uses 52 seasonal indexes for the data and does not accommodate the holidays changing weeks from year to year Graph the event variable _Holidays _Holidays takes on the value of 1 for the week containing Memorial Day the value of 2 for the week containing the 4th of July the value of 3 for the week containing Labor Day and 0 for all other weeks Including an event index for each holiday allows us t
170. he in place overrides This is due to factors such as the item or group that had an in place override may no longer exist after you change the hierarchy or that changing the units would result in a different forecast allocation across the hierarchy To avoid these problems and to insure that the final forecasts will remain consistent regardless of the hierarchy or units you are viewing Forecast Pro TRAC will move the in place overrides into the Inherited Overrides row prior to performing hierarchy changes and or conversions Override I and Override 2 contain any overrides that you have entered for the current forecasts Proposed overrides are displayed in red committed overrides are displayed in black The Commit button is used to convert proposed overrides to committed overrides The Formula checkbox allows you to enter overrides as either formulas or hard numbers The override view s context menu allows you to rename the override row labels and add or subtract rows on the fly Forecast contains the current committed forecasts These are the values that are displayed on the graph and the values that will be written as forecasts in any output files that you save to disk The Forecast values may differ from the Statistical values if you have committed to overrides for the currently displayed forecasts or any other forecasts in the hierarchy that would impact the currently displayed forecasts There are three steps in the override
171. he groupings directly in the data file using attribute fields This approach was discussed in the Setting Up Your Data chapter The other approach 1s to define the groups on your script Here for example is a script that a beer manufacturer might use Octet O _GROUP Brand 123 Bakery xls _GROUP Retail a rees Acme Cameras xls itine xls eer xis ottles xis Ic Users Public D ocuments F orecast Pro T RAC Input This script defines three aggregate groups named Brand Retail and Commercial These group variables are not in the database they are created internally by aggregating all data files found between a_GROUP statement and its corresponding _END flag Thus the group Retail is defined as the sum of all of the time series found in the data files Cans and Bottles The group Commercial is defined as the sum of all of the time series found in the data file Kegs The group Brand aggregates the two lower level groups Retail and Commercial Notice that each group definition begins with a _GROUP NAME line and ends with an _END The indentation is optional and serves only to make the script easier to read In addition to using the GROUP and _END modifiers on the script you can also define groups within a data file using attribute fields Groups defined within files will appear on the Navigator when the data are read in You can combine script based and within file group definitions if you wish Defining th
172. hem as the default settings for all new projects The Numeric Output Design dialog box contains three pages or tabs We will discuss each tab in turn 10 6G 4 06S4 0 0 MOOS though 2011 E Holdout 0 Units Defaut gt Stat Forecast Unlocked F Lesson 7 Numeric Output fo e lls a an Total Category Customer SKU Record Type Description Unts 2011Jul 2011 Aug 2011 Sep 2011 04 2011 Nov 2011 Dec 2012Jan 2012 Feb 2012 gt L Ni otal t art COR 12 Point forecasts CASE 12 count Corn Muffins D 5 8 458 63 16 5 9 0 D Detaut 544 79 18 317 55 36 745 69 23 071 52 11 233 73 14 14 COR 12 11 BRA 12 11 d 95 96 35 246 22 10 972 77 10 792 16 6 564 12 5 371 00 23 851 00 18 082 00 19 127 00 20 48 BLU 12 11 Output F cman l d omat Time Series Data Model and Statistics 703 24 9 825 67 7 068 69 7 292 36 8 178 OAT 12 oti 7 222 89 39 098 25 20 393 74 4 567 44 1 068 OAT 12 11 0 3 Sids Club 0 F fle Tt D 0 7 050 28 7 050 28 7 050 28 7 050 orecast mode pace COR 12 11 ot ii 58 7 689 58 7 690 36 7 690 58 7 690 BRA 12 11 r Default units only Enter I 16 093 33 10 537 60 5 553 18 5 839 ask of fail Period 56 14 653 59 19 547 83 659081 6 993 E3 12 hierarchy ib Grocencband 0 10 744 28 7 396 66 6 679 80 7 836 include tems without forecasts COR 12 11 Je olacehold n 6 8 017 03 4 007 41 3 981 86 4 060 BLU 12 11 Select fiter attributes to display 80 10 248 27 5 380 30 4 584 89 7 664 APP 12
173. hey match the ones shown above and click OK Customizing the Graph View 31 Overriding the Forecasts There will undoubtedly be times when you want to judgmentally override the statistical forecasts For instance you may know of a large incoming order and need to change a number or two Forecast Pro TRAC allows you to make these changes quickly and easily Click the green Override Forecasts icon or select View gt Overrides from the menu Your display should look like the one below File Settings Operatio nema Project View Window Help 050055003000 Ov aniGO00R8 Stat Forecast Unlocked through 2011 6 Holdout 0 Units Default Total F Project03 Forecast overrides Muff 5 gt KTA COR 12 11 i 993 38 380 89612 101312 64811 144 767 79589 53 013 50435 38975 30 BRA 12 11 BLU 12 11 i APP 12 11 OAT A2 11 993 38380 89612 101 312 64811 144767 79589 53 013 50 435 38975 30 107 42 674 Sids Club Grocery Land Food King Cakes Project03 Graph ol 8 amp 123 Bakery Inc Stuff Mart Customer v2 Serer reer err rrr errr errr errr ieee errr rrr rrr rrr rrr rrr rrr irri rrr rrr rrr rire fererrrrrrr Prrerrrrrr ss DO E E A L A T A AET P AN EA EIER PEE A E E P E T EA ESAI EA EEN EE EORPA A ER a E EEN AE EE E AE PE EA EN EOE EAE E EAEE EE 1 EEES E E EEEE E ETER a T E OEE Wp EE E L E E
174. ialog box appears 230 Command Reference ne ne O O S orecast Origin Hierarchy Units Project Last Updated Oven des Status 2011 May 1 1 2 3 4 Defaut Lesson 3 5 5 2011 10 33 02 6 Archived 2011 May 2 1 2 3 4 Dollars Lesson 3 5 5 2011 10 46 09 2 cast ongin 2 i wwa C The Import Archived Overrides dialog box allows you to select the override sets to load You can load an individual override set by highlighting the set and clicking the Apply button Alternatively you can load all displayed sets using the Apply all sets button The Filter by options allow you to control which override sets to display Selecting Compatible series will eliminate all override sets that do not match the current state 1 e it will eliminate all override sets where the units of measure and or the hierarchy structure does not match the current project s display Project gt Export The Project gt Export menu allows you to save Numeric Output files and all Forecast Pro TRAC report files Consult the appropriate section of the Forecast Pro TRAC Interface chapter for details on designing the content and format of these output files Project gt Set password Project gt Set password is used to password protect your project When you attempt to open a password protected project Forecast Pro TRAC will prompt you for the password and only open the project if the correct password is entered When you password protect a pro
175. ic Output The first tab allows you to specify whether you wish the output to use the currently displayed units and hierarchy or always output the default units and hierarchy It also allows you to specify the file type and control the layout The Time Series Data tab and the Model and Statistics tabs allow you to specify the contents Explore the options on this dialog box If you are unsure of the function of any selection click the Help button for a description The settings you select will be used for your current project If you click the Set as Default button on the displayed tab the current settings will also be saved as the default to use for all new projects Exit the dialog box 38 The Basics Click the purple Save Numeric Output icon A dialog box will appear allowing you to name the file Name the file Test Numeric Output and save it Examine the file and verify that its contents and format matches those specified in the Numeric Output Design dialog box Saving the Project Our final step will be to save our current forecasting session as a project Saving a forecast project allows you to return later and pick up where you left off or to share the session with others Select File gt Save As and save the project using the name fest project Be aware that a forecast project saves the data forecasts and overrides that are currently in memory If you update your input data files after saving a project when you reopen the pro
176. ide rows and override adjustment mode established for the initial component project for will be used for the other component projects 2 Open a new project and use Project gt Team Archive gt Link to to specify that this project will be a component project and to link to team archive database established in step 1 3 Repeat step 2 for any additional component projects 4 Finalize the forecasts for the component projects and save the component projects 5 Use Project gt Team Archive gt Open to open the consolidated project Using a Time Fence Time fences are used to lock forecast values for a specific number of periods so that they can t be changed via user overrides or by the generation of new statistical forecasts as new data become available Time fences can be useful in environments where after forecasts have been finalized and acted upon 1 e production has been scheduled orders have been placed etc there is a window of time where making changes is not feasible Fh Forecast Pro TRAC time Fe File Settings Operations Project View Window Help COGS S56 6G64 9E Gs 04 6 OOO 46 J4 Stat Forecast Unlocked 2006 1 gt through 2011 6 gt Holdout 0 Units Default X Total ast ovemdes Muffins Stuff Mart cor1241 Jui Awg sep mar awr may Jun COR 12 11 4825 6949 14795 17 623 14 994 33 322 19 761 8 742 12
177. ify the flagged item The next two Lower Bound and Upper Bound display the thresholds that trigger an exception The Date column identifies the exception period The next two columns Forecast and Prior Period 12 display the item being monitored in this case the forecast and what it is being monitored against The Deviation column shows the difference and the Deviation column shows the difference as a percentage The final three columns display the Statistical Forecast which in this example equals the final forecast along with the Deviation and Deviation Point to the first item on the report and double click Point to a different item on the report and double click Notice that when you double click an item on the exception report the Navigator jumps directly to that item Thus you can use the exception report as the equivalent of a Hot List to navigate through the listed items All of the global report views yellow icon views support this kind of navigation Right click on the exception report and select Exception Report Settings 76 Exception Reporting The Exception Report Settings dialog box allows you to specify the exception report you d like to view and customize the report The Forecast periods to consider section allows you to set the number of forecast periods to monitor The current setting 1 through 1 will only monitor the first forecast period 1 e July 2011 Select All periods and click the A
178. in 2011 Jun 1 Hierarchy 1 2 3 4 Units Default Last Updated 5 6 2011 10 26 50 AM BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 Cakes eet 26839 6196 35246 VA 20 01 Total gt Muffins gt Grocery Land Percent gt Value 5 611 BRA 12 11 CASE 12 count Bran Muffins XZ Hier 1 2 3 4 Local Notice that there are three override sets displayed The first set s origin is May e the last historic data point was May first forecast was June and the overrides were made in base hierarchy 1 2 3 4 and base units default The Working with Override Sets 53 second set s origin is also May and the overrides were also made in base hierarchy but the units were dollars The third set s origin is June It is currently empty since no overrides have been entered nor have any override sets been loaded Select Project gt Import gt Archived Overrides ne es ke Forecast Origin Hierarchy Units Project Last Updated Overides Status 2011 May 1 1 2 3 4 Defaut Lesson 3 5 5 2011 10 33 02 6 Archived 2011 May 2 1 2 3 4 Dolas Lesson 3 5 5 2011 10 46 09 2 Apply all sets Help The Import Archived Overrides dialog box allows you to load any override set that is in the Forecast Pro TRAC database In our example the two May origin override sets are the only entries in the database The Apply all sets button will apply all override
179. inactive and will not be forecasted If you do not adjust the starting or ending dates Forecast Pro TRAC will prepare forecasts using all available data for each active series For our current example we will not adjust the time span of the data nor will we define a holdout sample Reading in the Data 25 Generating the Forecasts Forecast Pro TRAC ProjectO3 File Settings Operations Pr iew Window Hel 0666 5566 4 086 4 0 44 0 000 06 gt Holdout 0 Units Default X Stat Forecast Unlocked 1 E through 2011 E 3 Total Muffins 3 Sige Stuff Mart Customer COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 H Sids Club 4 Grocery Land Food King H Cakes 2007 Jan 2009 Jan 2011 Jan BB History HB Forecasts HB Forecast Interval Project03 Forecast Report Forecast Report for Stuff Mart jn Customer Total gt Muffins gt Stuff Mart Expert Analysis Jj aaaaaaaaaaaaaaaalaiaiaiaialalalaaaaausssssssi iaIassssst Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins will perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 9 265 and for Box Jenkins was 17 579 The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method Based on the lower MAD wil use Exponential Smoothing Click the red Forecast icon
180. ine the hierarchy by moving the currently selected level up or down one level For example promoting level 3 of a 4 level default hierarchy would change the displayed hierarchy from 1 2 3 4 to 1 2 4 3 Hierarchy gt Move to Top promotes the currently selected level to the highest level Hierarchy gt Move to Bottom demotes the currently selected level to the lowest level and Hierarchy gt Restore Default converts the currently displayed hierarchy back to the default hierarchy The Hot List Placing items on the Hot List allows you to efficiently navigate work with and report on a subset of the items listed on the Navigator Items can be added to the current Hot List by dragging from the Navigator or by using the Add to Hot List option on the Navigator s context menu When you select an item on the Hot List Forecast Pro TRAC will immediately select the item on the Navigator and update the affected views oject File Settings Operations Project View Window Help 0006105664 08S4 0 4 00006 Stat Forecast Unlocked 1 gt through 2011 gt 6 gt Holdout 0 Units Defauk Total a Z Project03 Graph lft Muffins Stuff Mart COR 12 11 CASE 12 count Corn Muffins COR 12 11 gt BRA 12 11 6 BLU 12 11 i APP 12 11 a A a a a a E o paceeennneeee OAT 12 11 Sids Club COR 12 11 o Serer reenter irr er i i rir ott errno trot a R A O bonne Apepey A Oe Deere BRA 12 11 BLU 12 1
181. ing However seasonal forecasts from short data sets are feasible when the short data sets are nested within aggregate product groups with longer histories The seasonality of the aggregate can be borrowed and applied to the short data sets See the section entitled Multiple level Scripts in the next chapter for details Seasonality can be estimated and forecasted from two to three years of data but this amount of data is marginal especially when your data are noisy or intermittent In some cases patterns in the noise are mistaken for seasonality yielding inappropriate seasonal forecasts Robust capture of seasonality requires three or more years of data Four to seven years 1s even better since there 1s more information from which the program can separate seasonality and trend from the noise 136 Setting Up Your Data There is little additional payoff in accuracy beyond about seven years of data and the cost in computer time can be substantial Missing values and zeros Each of the statistical forecasting methods requires an unbroken stream of historic values Unfortunately however missing values are common in business data You therefore need a well formulated approach to missing data There are two parts to the approach You must first decide how to encode missing values in the input data file Then you must decide how these missing values are to be treated by Forecast Pro TRAC The encoding of missing values depen
182. ing secondary file is 123 Bakery_Secondary xls The creation of these files is fully documented in the Reference section of this manual In our current example we defined three alternative units of measure in the secondary file dollars pounds and pallets Fo Forecast Pro TRAC Lesson 2 par 1 M E n nj Sm File Settings Operations Project View Window Help 0065 5566 4 068s 0 4 000188 Stat Forecast Unlocked 2006 1 through 2011 6 gt Holdout 0 Units Defauk 3 Total 3 Muffins Stuff Mart o eara BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 3 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 3 Grocery Land COR 12 11 BLU 12 11 36 746 23072 14143 6545 8459 16457 19715 18318 36 746 23072 11234 14143 12264 6565 8628 76 050 98 289 191 232 229 085 212 850 426 985 268 091 130 536 164 338 142 504 76 281 100 253 46 468 60 056 116 846 139 975 130 055 260 894 163 808 79 759 100 413 87 072 46 609 61 256 726 939 1827 2188 2033 4079 2561 1247 1570 1361 729 958 Formulas C Percent 10 gt increment 1 Value 6 545 Ovemdel 7 Hep APP 12 11 V Converted forecasts 3 Food King COR 12 11 BLU 12 11 APP 12 11 COR 12 11 CASE 12 count Corn Muffins VA 20 01 ST 20 02 s gt Stuff Mart gt Sids Club 2010 Jan 2011 Jan 2012
183. ing the project file and the optional corresponding MDB file formats 2 Drive Forecast Pro TRAC by issuing the command C Program Files Forecast Pro TRAC v2 ForecastProTRAC exe Test FPProj b where we assume that the program is located in the directory C Program Files Forecast Pro TRAC v2 and a project named Test FPProj is located in your current project directory The b parameter is used to indicate that you wish to run in command line batch mode 238 Command Reference You can issue the command in any number of ways including Select Run from the Start menu and issue the command from there Set up a shortcut to issue the command Issue the command from within a different application using a system call The Command Line tab of the Settings gt Options dialog box allows you to specify several key command line forecasting options and the output files to save in command line mode This tab s functionality was fully described in the Menu Items and Dialog Boxes section earlier in this chapter Important Notes 1 If there are spaces in the pathname you must include quotation marks as illustrated in the example above 2 If you do not want the Forecast Pro TRAC menu to appear run the program minimized Command line Operation 239 Chapter 6 Understanding How Forecast Overrides are Allocated The override facility in Forecast Pro TRAC allows you to adjust the statistically generated forecasts Changes ma
184. ins data and forecasts for all three countries which makes it harder to manage and more error prone An alternative approach is to use a team archive This allows you to create a separate forecasting project for each country and link them to a communal Forecast Pro TRAC database 1 e a team archive Using this approach the three demand planners can work on their forecasts simultaneously using a project that only contains their country When all three are done the team archive can then be opened directly to view the consolidated forecast Start Forecast Pro TRAC select File gt Open and open the project Lesson 4 USA Working with Team Archives 61 File Settings Operations Project View COGS S56 2007 1 Stat Forecast Unlocked 1 68 4OOGs 0 H H o 000108 though 2011 211 E Hodon o E Units Defaut x Total F Lesson 4 USA Forecast overrides USA PG1 204 1 o PG1 204 2 Statistical PG1 204 3 PG1 204 5 Forecast 1219 1 794 1 632 1 804 2174 1 492 1 560 PG1 204 4 1 751 1 263 1 098 Petcer t Increment j i j t aHes History Converted forecasts F Lesson 4 USA Forecast Report o loz Forecast Report for PG1 204 2 A Cases GFCI ivory Total gt USA gt PG1 204 2 Raw hierarchy is Total gt USA gt PG1 204 2 Expert Analysis Using rule based logic have narrowed down the choice to exponential smo
185. ions on the dialog box accessible via the tabs The more commonly changed options are found on the Basic tab shown above The Formats tab is used to set details of the data file interface and control the precision in the on screen displays The data file interface defaults have been carefully chosen and should only need to be changed for users using comma delimited data files or who do not follow the US conventions for the decimal separator The Outliers tab allows you to control the settings for outlier detection and correction This will be covered in Lesson 12 The Overrides tab allows you to customize the override facility The Command Line tab allows you to control the settings for command line operation This will be covered in Lesson 7 The Pareto analysis allows you to dictate how to calculate the ABC classifications This will be covered in Lesson 5 The Advanced Controls tab is used to set details of the optimization routines and to control how often Forecast Pro TRAC checks for product updates Let s take a closer look at the Basic tab Forecast Pro TRAC reads in the historical data from the Input Data directory Project files are saved to the Projects directory Forecast files and reports are written to the Output directory The Data Mode specifies the format of the historical data The forecast output can be saved in any supported format You can set the percentiles for the confidence limits the lead time for safety stock calculation
186. ipt dialog box allowing you to edit the current script Read Data Reads in the data listed on the current script from its primary source Forecast Executes the current script file and creates the forecasts This option is only available when a script has been defined and the data have been read View Forecast Report Opens and closes the Forecast Report view View Graph Opens and closes the Graph view Override Forecasts Opens and closes the Override view allowing you to adjust the forecasts for the current selection View Tracking Report and Graph Opens and closes the Tracking Report view and Tracking Report Graph View Item Report Opens and closes the Item Report view 188 Command Reference 2A aa D View Exception Report Opens and closes the Exception Report view View Override Report Opens and closes the Override Report view View Outlier Report Opens and closes the Outlier Report view Preview Numeric Output Opens and closes the Preview Numeric Output view This view previews the contents and format of the Numeric Output file Save Formatted Forecast Report Allows you to save Formatted Forecast Reports to disk The Excel file will contain a report for every item forecasted You can save Formatted Forecast Reports for the items on the current Hot List only using the Hot List s context menu Save Forecast Tracking Report Allows you to save the Tracking Reports to disk The Excel file will con
187. issimatencioatie 50 Step Two Opening Your Forecast Project essessssooeeessssssssoeerrsssssssserssss 31 Step Three Savne Your Wolkermerei ia n A inate eseeaek 52 Workin With Ov erie SetS iesin n E EA 52 Collaborating With Colleagues cccccscssssssssssccssscccccccccccccccscsssssssssees 57 Stand alone Projects vs Team Archives ccccssessssccceecceeeeeeseeeeeeeeeeeeenees 57 Shanne a Stand alone Project esenee a 58 Workine with Team ATC DIVES eccone ous eaaiincceu eoreuabeedeas tes euavdeccees 6l Pareto Analysis and Report Filtering sssssssscecceccccssssccecocossssscceeosssssssseee 65 Defining Pareto Classifications Within Forecast Pro ccceeecceeeeeeeeeeeeeees 65 Sorting and Filtering the Pareto Output eccccccccccceeeeeeeeeeeeeeeeeeeaeeees 67 Defining Pareto Classifications via a Custom Filter cc eecececcceeceeseeeeeeeeees 69 Tracking Forecast ACCUraCy sscccisci cass cecaczesuivcctiscaceccesusvssees detadsesusvestaseeccecesnass 71 Readine be Trackno R poileneann anne ace ten MT cat ator Pret Pe eter re Pn re 71 Customizing the Tracking Report cceccccccccccssssseeseeceeeeeeeeeesseeeceeeeeeeneees 74 Exception REDONE 3505 scaveccvvscsuccbovestencvacscacsscanecaeveceusesavescecdvacsccesscanecacvecscans 75 Momitorins Current POLCCASUS a sctsed action E E E 75 Monitors Archived Forecasts nsien nevileracecee 78 Operating From the Command Line seeeeeeeececccccsccssssssssccccc
188. its terms and conditions This EULA supersedes all prior agreements oral or written communications proposals representations and watranties and prevails over any conflicting or additional terms of any quote order acknowledgment or other communication between the parties relating to its subject matter during the term of this EULA No modification of this EULA will be binding unless made in writing and signed by an authorized representative of each party B In the event that any portion of this EULA is held unenforceable the unenforceable portion shall be construed in accordance with applicable law as nearly as possible to reflect the original intentions of the parties and the remainder of this EULA shall remain in full force and effect C This EULA will be governed by and construed and enforced according to the laws of the Commonwealth of Massachusetts USA excluding its conflict of law provisions Suggested Reading The Forecast Pro Statistical Reference Manual is a pdf document that is copied to the program directory when you install Forecast Pro It is also accessible via the Forecast Pro help system and is the primary suggested reference for all of the forecasting techniques statistics and algorithms found in Forecast Pro 256 Appendixes The Forecast Pro Statistical Reference Manual includes an extensive bibliography A few recommended textbooks include J S Armstrong 2001 Principles of Forecasting A Handbook for Resear
189. ject Forecast Pro TRAC uses Microsoft Access s security functionality to password protect the project s mdb and TRAC files This means that in addition to requiring the password to open the project in Forecast Pro TRAC the password is also required to open the project s mdb or TRAC file in Microsoft Access Menu Items and Dialog Boxes 231 Project gt Team archive The team archive menu is used to create team archives link component projects to a team archive and to open the consolidated project Project gt Team Archive gt Send to is used to create a new team archive This option converts the current project from a stand alone project into a component project and allows you to name the team archive file It is important to note that the settings for forecast horizon confidence limits percentiles number of override rows and override adjustment mode established for this initial component project will be used for all subsequent component projects that link to the team archive Project gt Team Archive gt Link to is used to link a new project to an existing team archive Project gt Team Archive gt Open is used to open a team archive directly This will consolidate all of the component projects and allow you to view and manipulate the consolidated forecasts Project gt Control Panel Project gt Control Panel invokes TRAC Control Panel dialog box which is used to view information about the current project s database and to purge
190. ject you Il have the option of either opening the project as it existed when you saved it or reading in the updated data and revising the forecasts Exit the program This concludes Lesson 1 Saving the Project 39 Lesson 2 Working with Conversions and Alternative Hierarchies In this lesson we will explore how Forecast Pro TRAC allows you to view and work with your forecasts in different units of measure and different hierarchical structures The Default State When you set up your data for Forecast Pro TRAC the units of measure you use for the historic demand and the hierarchy that you define are referred to as the default units of measure and the default hierarchy respectively Together they comprise the default state Let s illustrate this with an example Start Forecast Pro TRAC Select File gt Open and open the project Lesson 2 part 1 41 Forecast Pro TRAC Lesson 2 part 1 rl iim File Settings Operations Project View Window Help 0005506640664 0 4X4 000008 1 through 2011 gt 6 gt Holdout 0 5 Units Defaut Stat Forecast Unlocked 3 Total Lesson 2 part 1 Graph 3 Muffins 3 Stuff Mart gt eevee BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 Grocery Land seen 2010 Jan 2011 Jan ae ME Forecasts MM Forecast Interval Food King f ooz COR 12 11 Lesson 2 part 1 Forecast Report BLU 12 11 Fo
191. ked 2007 1 though 2011 2 Holdout 0 ASAL00_BW ASA100_Color 2008 Jan 2011 Jan Ja BB History HM Forecasts HM Forecast Interval F Project06 Forecast Report Forecast Report for Total Total Total Expert Analysis Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins will perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 36 691 and for Box Jenkins was 44 440 The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method Based on the lower MAD will use Exponential Smoothing Notice that the Navigator tree structure matches the hierarchy shown below vFormat_Film The tree contains three group variables Total Camera and Film The tree also contains six end items vCamera 1Camera vFormat_Film iCamera_Film ASA100_BW and ASA100_Color The demand histories for group variables are not in the database They are created by Forecast Pro TRAC by aggregating the appropriate end items Thus the history for the group Camera is defined as the sum of vCamera 1Camera The history for the group Film is defined as the sum of vFormat_Film 1Camera_Film ASA100_BW ASA100_Color The history for the group Total is defined as the sum of the groups Camera Film When you forecast a multiple level hierarchy Forecast Pro TRAC will automatically
192. kly seasonal data because production and inventory control require it Event adjustment models can help you with some of the problems that you will face Event models allow you to control how many indexes to include in the model To illustrate let s model C 6 using the _P amp H event variable 98 Building Event Models _P amp H maps each week into one of 13 periods i e weeks 1 4 are coded 1 weeks 5 8 are coded 2 etc The summer holiday weeks Memorial Day q of July and Labor Day are coded as 14 15 and 16 respectively You may want to examine the data in the Beer Events xls spreadsheet to see precisely how this is accomplished Turn back on the Forecast Report view and then use the Navigator s context menu to specify that _P amp H be used as the event schedule for C 6 The resulting model uses 16 event indexes 13 to capture the seasonality and three for the summer holidays bp Foes 01 06 O E o U O O S O 5 tt File Settings Operations Project View Window Hel 0000500820032 0 4 600008 Stat Forecast Unlocked 2005 1 through 2011 34 C 6 6 Packs 12 Ounce Cans _Helpers _HOLIDAYS gt P amp H F Project06 Forecast Report Event Code index 1 000 Notice that the forecasts exhibit much smoother seasonality than our previous model That is because there are now more samples of each index to be estimated Adjustment for Outliers Historic data sets often exhibit the effec
193. l Cakes Stuff Mart ST 20 02 CASE 20 oz Strawberry Pound Cake 2006 1 12 12 1 563 1 143 1 767 1 19 Total Cakes Stuff Mart LF 20 02 CASE 20 oz Low Fat Pound Cake 2006 1 12 12 824 2 494 1 767 2 20 Total Cakes Stuff Mart LE 20 02 CASE 20 oz Lemon Pound Cake 2006 1 12 12 1 351 1 975 1 767 3 21 Total Cakes Stuff Mart CO 20 01 CASE 20 oz Coconut Layer Cake 2006 1 12 12 0 0 4 368 E 22 Total Cakes Stuff Mart CH 20 01 CASE 20 oz Chocolate Layer Cake 2006 1 12 12 0 0 9 240 9 23 Total Cakes Stuff Mart CA 20 01 CASE 20 oz Carrot Layer Cake 2006 1 12 12 0 0 14 280 11 24 Total Cakes Stuff Mart BU 20 02 CASE 20 oz Butter Pound Cake 2006 1 12 12 5 715 1 035 2 595 5 25 Total Cakes Sids Club VA 20 01 CASE 20 oz Vanilla Layer Cake 2006 1 12 12 12 061 9 072 10 872 15 26 Total Cakes Sids Club LF 20 02 CASE 20 oz Low Fat Pound Cake 2006 1 12 12 27 Total Cakes Sids Club CO 20 01 CASE 20 oz Coconut Layer Cake 2006 1 12 12 20 196 12 672 18 144 24 28 Total Cakes Sids Club CH 20 01 CASE 20 oz Chocolate Layer Cake 2006 1 12 12 29 Total Cakes Sids Club CA 20 01 CASE 20 oz Carrot Layer Cake 2006 1 12 12 8 964 6 480 7 920 12 30 Total Cakes Sids Club BU 20 02 CASE 20 oz Butter Pound Cake 2006 1 12 12 31 Total Cakes Grocery Land VA 20 01 CASE 20 oz Vanilla Layer Cake 2006 1 12 12 32 Total Cakes Grocerv land_ F 20 02_ CASF 20 oz l ow Fat Pound Cake 2006 K 1 1 1479 2 474 3771 1 MAP Sheeti 23 j4 gt i Ready a Oj 115 In our
194. l conversion factors custom filter fields and exception report thresholds When Forecast Pro TRAC reads in a data file table or query it looks for a corresponding secondary file table or query The convention used to associate a secondary file with a data file is to use the same filename with Secondary appended to it For example if the input filename is Data xls the corresponding secondary file must be named Data_Secondary xls Examine the file 723 Bakery_Secondary xls 152 Setting Up Your Data Page Layout Formulas Data Review View Add ins AbleBits com mrad Bor Dana H ee Lae L To eS 1 Total Category Customer SKU Dollars Pounds Pallets filter Custom Pareto filter Sales Rep FVH_MINP_ FVH_MAXP FVH_MIN FVH_MAX FR_MIN FR_MAX MAPE_MAX MAD MAX FVA _2 Total Muffins Stuff Mart COR 12 11 11 62 7 1 O111A Jack Smith 10 10 8635 8635 0 70 000 25 8635 _3 Total Muffins Stuff Mart BRA 12 11 11 62 7 1 O111A Jack Smith 10 10 17440 17440 0 50 000 25 17440 4 Total Muffins Stuff Mart BLU 12 11 22 52 7 1 O111A Jack Smith 10 10 3608 3608 10 000 40 000 25 3608 5 Total Muffins Stuff Mart APP 12 11 22 52 71 01118 Jack Smith 10 10 1893 1893 4000 12 000 25 1893 6 Total Muffins Stuff Mart OAT 12 11 11 62 7 1 0 1118 Jack Smith 10 10 13659 13659 0 50 000 25 13659 _7 Total Muffins Sids Club COR 12 11 11 62 7 1 01118 Amy Brown 10 10 3765 3765 2 862 10 393 25 3765 8 Total Muffins Sids Club BRA 12 11 11 62 71 011
195. le will speed up processing 10 Optimize Model Selection for Speed Specifying Exclude ARIMA on the Advanced Controls tab of the Settings gt Options dialog box will speed up forecast generation considerably This option will remove Box Jenkins models from consideration when using expert selection If you are forecasting data where the number of periods per cycle is greater than 13 e g weekly data you might consider turning on the Exclude seasonal simplification option in the Advanced Controls tab of the Settings gt Options dialog box If this switch is on Forecast Pro TRAC s expert selection mode will not consider seasonally simplified forms of exponential smoothing models This will speed up forecast generation considerably Specifying the models to use rather than using the expert selection will substantially improve performance This will require some work to determine the best type of model to use for your data The best way to determine the appropriate model for your data set 1s to experiment using the forecast 252 Appendixes evaluation procedures see methodology chapter in the Forecast Pro Statistical Reference Manual for details End User License Agreement This End User License Agreement EULA is a legal agreement between Licensee either an individual or a single entity and Business Forecast Systems Inc BES for the BFS software that accompanies this EULA 1 DEFINITIONS A BFS m
196. lection Lesson 2 teaches you how to work with conversions and alternative hierarchies Lesson 3 teaches you how to update your forecast project as new data become available Lesson 4 teaches you how to collaborate with colleagues to establish the final forecast It covers both sharing stand alone forecast projects and using team archive files to break large forecasting projects into smaller pieces that can be worked on separately and then reassembled into consolidated forecasts Lesson 5 teaches you how to use Pareto analysis to assign ABC classifications to your forecast items and how to sort and filter reports Lesson 6 teaches you how to archive your forecasts and use waterfall reports to track your forecast accuracy Lesson 7 teaches you how to use exception reports to identify poor forecasts and other potential problems in an efficient manner Lesson amp teaches you how to operate the program from the command line 4 Before You Begin Part 3 Tutorial Forecasting Operations Lesson 9 teaches you how to use forecast modifiers to dictate model selection Lesson 10 teaches you how to build event models to capture promotional effects Lesson I teaches you how to set up and forecast a multiple level script Lesson 12 teaches you how to forecast new products prior to historic data being available and also teaches you how to use the forecast by analogy and Bass models Lesson 13 teaches you how to use weights to adjust for tr
197. lier or building an event model for the time series if the cause of the outlier 1s known will often improve the forecast However if the outlier is not truly severe correcting for it may do more harm than good When you correct an outlier you are rewriting the history to be smoother than it actually was and this will change the forecasts and narrow the confidence limits This will result in poor forecasts and unrealistic confidence limits when the correction was not necessary It is the author s opinion that outlier correction should be performed sparingly and that detected outliers should be individually reviewed by the forecaster to determine whether a correction is appropriate 121 Forecast Pro TRAC incorporates an automated algorithm to detect and optionally correct outliers In this lesson we will explore its operation How Outlier Detection and Correction Works Start Forecast Pro TRAC select Settings gt Options and display the Outliers tab coms la Basic Formats Outhers Ovemides Command Line Pareto Analysis Advanced Controls Detection and Correction Logic None Sensitivity std deviations Detection only Maximum iterations Detection and correction Layout There are three modes for outlier detection and correction None turns outlier detection and correction off This is the default and many Forecast Pro TRAC users do not use nor need to use outlier detection Detection only wi
198. ll detect outliers and display the suggested corrected values however the forecasts will be generated using the uncorrected history Detection and correction will detect outliers and will automatically use the corrected values when generating forecasts The detection and correction algorithm works as follows 1 The specified forecasting model is fit to the time series the residuals fitted errors are generated and their standard deviation is calculated 2 If the size of the largest error exceeds the outlier threshold the point is flagged as an outlier and the historic value for the period is replaced with the fitted value 122 Detecting and Correcting Outliers 3 The procedure is then repeated using the corrected history until either no outliers are detected or the specified maximum number of iterations 1s reached In a multiple level problem the detection is only performed on the end items 1 e the nongroup level If the correction option has been selected after all end items are corrected the group level totals are reaggregated to reflect the corrected values You can adjust the Sensitivity setting to make the outlier threshold more or less sensitive The proper setting will depend on the stability of your data set Set the detection and correction mode to Detection only make sure the other settings match the selections shown above and click OK Reviewing the Outliers In this exercise we will perform the following step
199. ll of these models are univariate techniques They forecast the future entirely from statistical patterns in the past Thus you must have historic records preferably for several years of the variable you want to forecast Forecast accuracy depends upon the degree to which statistical data patterns exist and their constancy over time The more regular the series the more accurate the forecasts The simple moving average is widely used in business mostly because it is so easy to implement However it is really only appropriate for very short or very irregular data sets where statistical features like trend and seasonality cannot be meaningfully determined Discrete data models are used for data consisting of small whole numbers These models are characteristically used to model a slow moving item for which most orders are for only one piece at a time Forecasts are nontrended and nonseasonal Croston s intermittent demand model is not a widely known or used technique but in certain circumstances it is extremely useful It 1s usually used to model Forecasting Methodologies 13 data in which a significant number of periods have zero demand but the non zero orders may be substantial This is characteristic of a slow moving item which is ordered to restock a downstream inventory Forecasts are nontrended and nonseasonal Exponential smoothing models are widely applicable They are also widely used because of their simplicity accu
200. ly blank After data have been read in the dialog bar will include the span of the data the specified holdout sample and the currently displayed units The Navigator and Hot List are currently unavailable After data have been read in the Navigator and Hot List can be used to select individual items that you wish to view The Forecast Report window is used to display the forecasting model within sample statistics historic data and forecasts The Forecast Report window is one of four context sensitive views A graph view will become available after data has been read in An override view will become available after forecasts have been generated A forecast tracking view will become available if there are archived forecasts Active views display information for the item currently selected on the Navigator When more than one view is active the program will tile them The views are toggled on or off using the green icons or the View menu Five additional noncontext sensitive views are also available the item report view the exception report view the override report view the outlier report 20 The Basics view and the numeric output view These views display information for all items forecasted and are toggled on or off using the yellow icons or the View menu An Overview Running Forecast Pro TRAC consists of executing the following five steps l Prepare the database This is performed outside of the program and entails selecti
201. me fence for the current project Once you turn a project s time fence on it cannot be turned off Operations gt Time Fence gt Freeze Next Period Operations gt Time Fence gt Freeze Next Period will increase the length of all time fences in the current project by one period for the current forecast origin If you subsequently update your data with the next observation and create a new forecast thus changing the forecast origin the time fence lengths will revert back to their pre Freeze Next Period settings This option provides a way of insuring that after the forecasts are finalized someone doesn t inadvertently alter the frozen periods forecasts prior to the data being updated new forecasts being generated and the frozen periods forecast becoming an officially fenced value Operations gt Convert to SQLite Operations gt Convert to SQLite is only available in the 32 bit version of Forecast Pro TRAC It is used to convert a Forecast Pro TRAC project that was saved using a Microsoft Access database file into a Forecast Pro TRAC project that uses a SQLite database file This option is usually used when one is upgrading from the 32 bit version of Forecast Pro TRAC which allows the Menu Items and Dialog Boxes 229 database file to be either Microsoft Access or SQLite to the 64 bit version of Forecast Pro TRAC which only supports SQLite and wishes to convert their existing projects so they can be read into the 64 bit version Whe
202. mory 1 e caching to your hard drive This is substantially slower than using RAM Increasing the amount of RAM in your computer will improve performance of all of your applications 5 Use the Manual Override Mode If you make overrides to large complex hierarchies the reconciliation can take a little time To minimize the reconciliation time Forecast Pro TRAC supports a manual override mode When this mode is active the override window will include a Retain button as well as a Commit Button The Retain button is used to accept overrides without reconciling the hierarchy In this mode you would typically enter and retain all of the overrides you wish to make 1 e for multiple items and then click Commit to perform the reconciliation The control to turn on manual override mode is found on the Overrides tab of the Settings gt Options dialog box 6 Use the Manual Archive Mode By default Forecast Pro TRAC will automatically save all changes to the TRAC database every time you save your forecast project For large hierarchies this can be time consuming Forecast Pro TRAC allows you turn off the automatic archiving feature using an option of the Advanced Controls tab of the Settings gt Options menu If you turn this option off saving your projects will be much quicker however if you want to archive your forecasts for tracking purposes you will need to do so explicitly using Operations gt Archive forecasts or the blue Archive Forecasts i
203. n you convert projects we recommend that you save your converted projects using a different project name so that you will still have a copy of the old project The Project Menu The project menu is used to import overrides and modifiers from other projects to export 1 e save to disk Numeric Output files and report files to set project passwords to create and open team archives and to perform database maintenance Project gt Import Project gt Import gt Overrides from is used to import overrides and their associated comments from a saved project into the current project In order for a value to be imported the item name ancestry and date all need to match an item in the current project Project gt Import gt Modifiers from is used to import forecast modifiers from a saved project into the current project In order for a modifier to be imported the item name and ancestry must match an item in the current project Project gt Import gt Archived Overrides is used to load override sets from the current Forecast Pro TRAC database Common uses for this facility include loading override sets made last period after updating the statistical forecasts and loading override sets made in a team archive into a linked project In order for an override from the selected override set to be loaded the item name and ancestry must match an item in the current project When you select Project gt Import gt Archived Overrides the Import Archived Overrides d
204. n you open a zipped project Forecast Pro TRAC copies the zipped file from the network drive to a local workspace unzips the project files and opens the project allowing you to work on your project locally even though it was saved to a network drive When you resave your zipped project Forecast Pro TRAC will zip the updated local project files and save the updated FPZip file to the network drive To save and open zipped projects you select FPZip as the file type in the File gt Save as and File gt Open dialog boxes 4 Upgrade Your Hardware Upgrading your hardware will improve performance dramatically Forecast Pro TRAC will run on any Intel processor from the 386 on Since this product deals with large amounts of floating point data it makes sense to run it on as fast a machine as possible As an illustration using expert selection and four years of monthly history per item a Core2 2 2GHz machine forecasted 10 000 items in 39 seconds The same run took 4 minutes on a Pentium III 600MHz machine and 24 minutes on a Pentium 90MHz Having enough RAM is also important we recommend 2 Gigs if you are running a 32 bit operating system and as much RAM as your budget can afford if you are running a 64 bit operating system 250 Appendixes As you use the program Forecast Pro TRAC is storing and retrieving a great deal of information in memory If you do not have an adequate amount of RAM Forecast Pro TRAC will resort to using virtual me
205. ng APP 12 11 A COR 12 11 al es Stuff Mart CH 20 01 A gt BRA 12 11 SEOSTE Feen Stutt Mart APP 12 11 A Stuff Mart OAT 12 11 A Grocery Land COR 12 11 Sids Club COR 12 11 A BLU 12 11 BRA 12 11 A APP 12 11 ota luffins BLU 12 11 A Food King u x APP 12 11 A COR 12 11 uffins Grocery Land COR 12 11 A BLU 12 11 Taini Bhan Ponana Ann an aa a APP 12 11 Cakes Stuff Mart VA20 01 Total Total ST 20 02 LF 20 02 Jan 2009 Jan 2011 Jan E History EE Forecasts EE Forecast Interval Total Total XX Hier 1 2 3 4 _ 9 Local Scroll through the report Notice that the custom filter defined codes for A B C D and E rather than just ABC Using a custom filter for your Pareto codes allows you to specify as many categories as you wish and assign membership in any fashion you desire Experiment with the filtering and sorting options until you are comfortable with their operation When you are finished exit the program without saving changes to the Lesson 5 project This concludes Lesson 5 70 Pareto Analysis and Report Filtering Lesson 6 Tracking Forecast Accuracy When you save a forecast project Forecast Pro TRAC stores both the Statistical forecasts and the final 1 e adjusted forecasts in the project s database This means that if you have been updating your project and forecasts every planning period for example every month that in addition to the current month s forecast your projec
206. ng the type of data format to use and preparing the files Creating your data files is discussed in the first chapter of the Reference section For this lesson you will use sample data files provided with the package Specify the data format and default options This is accomplished by selecting the appropriate entries from the Options dialog box All options set by the user will be used for the current forecast project You can also save your selections as the default for future projects Create the script The script is a list of the data files to be forecasted and any special instructions It is created using the Define Script dialog box Select Operations gt Read Data Forecast Pro TRAC will then read the data from disk into RAM and display the starting and ending dates for the forecast run on the dialog bar Select Operations gt Forecast The software will then execute the current script to prepare the forecasts Once the forecasts have been created you may view them graphically adjust them and save them to disk The remainder of this lesson will guide you through steps 2 5 Setting the Defaults To set the default options click the light blue Options icon 3 which will open the Options dialog box shown below An Overview 21 C Users Public Documents Forecast Pro TRAC Input C Users Public Documents Forecast Pro TRAC Projects C Users Public Documents Forecast Pro TRAC Output There are seven pages of opt
207. nit consists of a size and color of a shoe in a certain style These are the items of importance for production and inventory control The corporation might aggregate these SKU s first into styles and then into style lines for marketing and sales These might be aggregated further into geographical regions for the benefit of top management Forecast Pro TRAC allows you to define product hierarchies and create one set of self consistent forecasts It allows top down or bottom up reconciliation seasonal adjustment based upon aggregate data and model selection at the aggregate level It is not necessary that item histories begin and end at the same time Thus items may consist of SKU s that have been retired or replaced by new SKU s Obsolete SKU s will contribute to the group level history but will not themselves be forecasted You will notice that the starting and ending dates for the overall script consist of the starting date for the oldest item and the ending date for the newest Forecasts will be prepared for all items and groups that are alive at the end of the data set Those whose histories terminate before that time are considered dead they contribute to the historic 168 Working with Scripts and Hierarchies aggregates and therefore influence aggregate forecasts but they are not themselves forecasted Forecast Pro TRAC allows you to organize your data into hierarchies two different ways The most common approach is to define t
208. nitored and what it is being monitored against This is followed by a Deviation column showing the difference and the Deviation column showing the difference as a percent Double clicking an item on an exception report will cause the Navigator to jump directly to that item Thus you can use the exception report as the equivalent of a Hot List to navigate through the listed items All of the global report views yellow icon views support this kind of navigation The content and format of the Exception Report is controlled using the Exception Report Settings dialog box This dialog box is invoked by selecting Settings gt Exception Report Settings or by selecting Exception Report Settings from the Exception Report view s context menu There are six exception report types each of which has a tab on the Exception Report Settings dialog box The Exception Report View 205 The Forecasts vs History report compares the current forecasts to previous historic values The Forecast periods to consider section allows you to set the number of forecast periods to monitor The Allowable deviation from history section allows you to set the sensitivity of the exception thresholds Item level thresholds allow you to assign different sensitivities to different items The item level thresholds must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section of this manual
209. nt forecast period the historic data begins in January 2006 and ends in June 2011 and that the first forecast period is July 2011 Forecast Pro TRAC refers to the most recent historic data period used to generate a forecast as the forecast origin Thus for the current forecast the forecast origin is June 2011 In addition to the current period s forecast this forecast project contains archived forecasts for the last 12 months Turn off the Graph view Click on the green View Tracking Report and Graph icon to open the tracking report and tracking graph Your display should now look like the one below 72 Tracking Forecast Accuracy Fj Forecast Pro TRAC Lesson File Settings Operations Project View Window Help GO6G5 55 6S54 OSGGBOC 4H OOOBS Stat Forecast Unlocked 2006 gt through 2011 6 Holdout 0 Units Default X s Total FJ Lesson6 Tracking Report Graph Muffins gt Stuff Mart Adjusted Forecast Tracking for Total gt Muffins gt Stuff Mart gt COR 12 11 COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 3 Sids Club COR 12 11 BRA 12 11 hy i BLU 12 11 F APP 12 11 Grocery Land k p COR 12 11 2011 Mar 2011 Apr 2011 May 2011 Jun BLU 12 11 ane APP 12 41 Lead time 1 Lead time 3 Lead time 6 Food King COR 12 11 BLU 12 11 Waterfall Report for Total gt Muffins gt Stuff Mart gt COR 12 11 APP 12 11 Cakes Adj
210. ntain comments Click on the June override cell to display the comment The comment informs us that John increased the forecast for the summer months by 20 in anticipation of a planned promotion Let s say that we feel that a 20 lift is overly optimistic for August the final month of the promotion and we want to lower it to 15 Set the target row box located to the immediate left of the Commit button which currently reads John to Override 2 Highlight the cell for August on the Statistical forecast row Set the percent box to 15 and click the Percent button Let s now add a comment Highlight the cell for the override you just made click the comment field and type John I lowered the promotional lift for summer madness to 15 and click the Commit button to accept the overrides and comment Now let s edit the row label Override 2 Click on the row label Override 2 and right mouse click to call up the context menu Select Edit Row Label Enter Management and click OK Notice that the row label has changed At this point we have several options on how we might save our work For instance we could Use File gt Save as to save a new forecast project to send back to John Click the purple Save Numeric Output icon to save an output file to submit to production management or some other destination Click the purple Save Forecast Report icon to save formatted reports to Excel Exit Forecast Pro TRAC without saving ch
211. o model the holidays that move around the calendar If we were to model this data as a monthly series the holidays would not change periods and an event model would not be necessary Build the model by clicking C 6 on the Navigator and using the context menu to add the event variable _ Holidays Modeling Weekly Data 97 gt Forecast Pro TRAC Project 5 A a o MM File Settings Operations Project View Window Hi 0666 55 66 4 08S4 0 4 0 000 06 Stat Forecast Unlocked 2005 1 though 2011 Holdout C 6 6 Packs 12 Ounce Cans C 6 6 Packs 12 Ounce Cans The model now includes 52 seasonal indexes to capture seasonality and three event indexes to capture the summer holidays Examine the fit to the holiday weeks and notice that the event model is not missing the holidays when they move around the calendar Although we would like the seasonal indexes to capture a smooth seasonal pattern in this case they do not This is because of the low level of temporal aggregation and other problems peculiar to weekly data The year usually begins and ends with a partial week Holidays such as Easter and Independence Day do not occur in the same week each year Some years may contain 53 weeks depending upon how a week is defined Different corporations address this differently Generally speaking monthly models will more accurately capture seasonality Nevertheless many corporations must deal with wee
212. o Classifications via a Custom Filter Forecast Pro TRAC allows you to define custom filter fields in the secondary data file This can be very useful when you wish to filter reports based on attributes that are not part of your forecasting hierarchy In this exercise we will display custom Pareto codes that were defined as a custom filter in the secondary file Start Forecast Pro TRAC select File gt Open and open the project Lesson 5 Right click on the Item Report view to display its context menu and select Item Report Design Open the Select filter attributes to display dropdown Notice that there are two custom filters available tfilter Custom Pareto and filter Sales Rep Click the checkboxes for both custom filters and click OK Notice that the Item report now includes the two filter fields Click the light blue Filter icon to activate the filtering and sorting mode Click on the filter dropdown for filter Custom Pareto select Sort A to Z and click OK Your screen should now look like the one below Defining Pareto Classifications via a Custom Filter 69 File Settings eee Project View Window FIE 002 0002 Ole ww OO GOS Stat Forecast Unlocked through 2011 Holdout 0 Units Detar v Stuff Mart COR 12 11 COR 12 11 a BRA 12 11 Stuff Mat BRA 12 11 A BLU 12 11 tal u Stuff Mart BLU 12 11 A APP 12 11 lu Food King COR 12 11 A OAT 12 11 i u Food King BLU 12 11 A Sids Club u Food Ki
213. of data points to be withheld from the end of your data set If you withhold 2 or more points Forecast Pro TRAC automatically generates out of sample evaluation statistics for any models that you build If you do not want to perform out of sample testing set the holdout sample to zero Changing Units The Units drop down box is used to change the display units This box will only be available if you have defined conversion factors for your current data set The Navigator The Navigator is the primary way to select an item to view in the forecast report graph and override windows After the data have been read the Navigator displays the available time series in a tree structure Selecting an item on the Navigator will automatically display all relevant information in the open views The Navigator also features color coded icons to allow you to spot items that contain overrides and or comments A red icon indicates that the item contains an override and or comment A green icon indicates that the item does not contain an override or comment A yellow icon on a group indicates that at least one item further down that branch of the tree contains an override and or comment 190 Command Reference File Settings Operations Project View Window Help 0666 565 664 01I6G5 0 4G OOO 8G J4 Stat Forecast Unlocked 2006 1 through 2011 6 gt Holdout 0 gt Units Default X 3 Total Project03 Graph 2 518 Muffins 3 Stuff
214. om an analogous product s model There is also a considerable body of literature on the Bass model including published coefficients for different types of technology Consult the Forecast Pro Statistical Reference Manual for details ten Coefficient of Innovation p 06 The example we are working with is a home electronic device Our market research suggests the total market is 1 million units A similar product had coefficients of innovation and imitation of 0 05 and 0 41 respectively Edit the settings to match the ones above and click OK to build the model The graph shows the forecasts growing for the first eight years and then starting to decline If you were to graph the forecasts on a cumulative basis for example in Excel the cumulative forecasts will resemble an elongated S This characteristic shape is why the Bass model is often referred to as an S curve model Right click HE 6 years on the Navigator to invoke the context menu and then select Model gt Bass Diffusion Bass Diffusion Model Settings E C jon q Initial Total m Cancel Help Notice that now that we have more than 5 data points Forecast Pro TRAC can automatically fit the coefficients and estimate the potential market from the Using the Bass Model 115 data The estimated coefficients are pretty similar to the ones we used prior to having data however the estimate of the potential market is a good bit lower Forecasting sales fo
215. on The data point is rather unusual and you can see that the forecast has a small spike in December which is being driven by the outlier Right click the item on the Navigator not the outlier report to bring up the Navigator s context menu Select Outliers gt Correct Notice that the status in the outlier report has changed to Corrected and that correcting for this outlier has changed the shape of the forecasts Double click on the next item on the outlier report Here too we have a fairly significant outlier and will want to correct for it Examine the remaining items on the Hot List and experiment with the Outlier options on the Navigator s context menu When you are comfortable with their operation exit the program This concludes Lesson 14 Correcting the Outliers 125 Lesson 15 Out of sample Testing A good deal of the empirical knowledge about forecasting has come from comparisons of different methodologies The M Competition Makridakis et al 1982 and M 3 Competition Makridakis and Hibon 2000 are the largest and most famous of these comparisons Forecast Pro participated in the M 3 competition and outperformed all other software entrants and 16 out of 17 academic teams The rather simple comparison methodology for the original M Competition was as follows The researchers assembled a collection of 1001 time series of yearly quarterly and monthly data The data were obtained from microeconomic industry level
216. on you may wish to investigate some of the following options 1 Use the 64 bit Version Forecast Pro TRAC can be installed as either a 32 bit or 64 bit application If you are currently running the 32 bit version migrating to the 64 bit version will speed up various operations such as opening and saving projects and will also allow you to work with larger data sets 2 Work Locally Working with projects stored on a network drive can be substantially slower than working on a project stored locally Reading input data over the network and saving output files to network drives can also be substantially slower than reading and writing from a local drive If you are currently saving your projects to a network drive saving them to a local drive will improve performance considerably If you are currently 249 reading your input data from a network drive and or saving output files to a network drive moving them to a local drive will speed up read write operations considerably 3 Use Zipped Projects As we mentioned above in some networked environments working with projects stored on a network drive can be substantially slower than working on a project stored locally To improve performance in these cases Forecast Pro TRAC supports zipped projects When you save a zipped project Forecast Pro TRAC zips the four standard project files described in a previous section of this manual into a single file with the extension FPZip Whe
217. onditional Formatting Insert ON BH E x Format as Tabie 3 Delete g A Paste bids 3 ANS Sot amp Find amp sey B 7 UB o A7 E E ae E H e o 5 Cell Styles lFormat lt 27 Filter Select Clipboard Font fa Alignment ail Number M Styles Celis Editing AE14 an fx wi A B n D E ula F G l H _ Jj K Lii 1 Variable Name Description Starting Year Starting Period Periods Per Year Periods Per Cycle Nov 02 Dec 02 Jan 03 Feb 03 Mar 03 Apr 03 2 PG1 204 1 2 Bolt Anchors 2002 11 12 12 24 18 39 23 25 24 d 3 PG1 204 2 4 Bolt Anchors 2002 11 12 12 74 77 102 71 bed 4 PG1 204 3 2 Staple Anchors 2002 11 12 12 103 157 114 5 PG1 203 4 3 Staple Anchors 2002 11 12 12 101 90 88 54 52 44 6 PG1 203 5 4 Staple Anchors 2002 11 12 12 109 90 75 109 199 129 7 8 44 gt gt Sheet1 AEJ The above example does not use attribute fields to define product groupings This is often desirable and is discussed in the Using attribute fields to define a hierarchy section In our example each data record consists of six header items in columns A through F followed by the historic data in the remainder of the row beginning in column G Each item is placed in a separate cell Columns A through F contain the following six items required items Variable name Up to 256 characters Variable description Up to 256 characters Starting year Must be an integer Starting period Must be an integer Period
218. option and are outputting more than one numeric output component Item Name Include a field listing the name of the variable as it appears on the Navigator If the Include ancestry option 1s active the ancestry will be shown as part of the item name The variable names used for all numeric output components other than Forecasts will include a suffix indicating the record type Description Units First historic date and First forecast date Include fields for the selected options The Numeric Output section of the tab allows you to select the Numeric Output components you would like to include SOOO Output Format Time Series Data Model and Statistics Wihin Sample Statistics Sample size Number of parameters Standard deviation The Model and Statistics tab is used to define the within sample statistics and model details that you wish to include and to set their precision If you are outputting a fixed width text file then you may also set the column widths Most of the options are self explanatory However we have noted some details below Model specification The model specification is a concise description of the model used The notation that is used here is also used on the Forecast Report Consult the Forecast Pro Statistical Reference Manual for further details The Numeric Output View 215 Transform The Box Cox transformation power 1 indicates no transform 5 the square root and 0 the natural log
219. or different lead times along with the demand during lead time and reorder point Out of Sample Rolling Evaluation and Out of Sample Static Evaluation not currently active list the out of sample statistics that are generated when a holdout analysis is performed Outliers not currently active lists any detected and or corrected outliers Overrides displays any overrides and or comments that were entered E im include Report Styles Components Forecast Only Basic Standard Complete Right click on the Forecast Report view to invoke its context menu Select Forecast Report Design Notice that this dialog box allows you to select a 28 The Basics standardized report style or create a custom one Select Forecast Only and click OK Notice that this report is much simpler that the standard one Return to the Forecast Report Design dialog box and experiment with the settings After you are comfortable with their operation edit the settings to display the Standard report style and click OK Customizing the Graph View Let s now explore some of the graphical options Display the Graph view by clicking its green icon Y Turn off the Forecast Report view by clicking its green icon Your display should now match the one shown below File Settings Operations Project View Window Help OGoGEe oo Saez rat CAA CAEN EA 2e a Zok TM s Def Stat Forecast Unlocked 2006 S the LUER H 5 Unit Defauk
220. orking With a Hot List The Hot List is the currently empty box located in the bottom left hand corner of the screen below the Navigator Placing items on the Hot List allows you to efficiently navigate and work with a subset of your items Working With a Hot List 33 Right click on the Navigator to invoke the Navigator s context menu Select Expand All to fully expand the Navigator Drag Total gt Muffins gt Stuff Mart from the Navigator into the Hot List area Your display should now look like the one below opectO0s File Settings Operations Project View Window Help 0646 556564 O6S4 0 4 6 OOO 8G Stat Forecast Unlocked 2006 1 S though 2011 6 Holdout 0 S Unts Defauk S A Total a Project03 Graph 3 gt TAE COR 12 11 123 Bakery Inc BRA 12 11 Stuff Mart Customer BLU 12 11 APP 12 11 OAT 12 11 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 Grocery Land COR 12 11 BLU 12 11 APP 12 11 Food Kin COR 12 11 BLU 12 11 APP 12 11 3 Cakes Stuff Mart VA 20 01 ST 20 02 Total gt Muffins gt Stuff Mart Total gt Muffins gt Stuff Mart gt COR 12 11 Total gt Muffins gt Stuff Mart gt BRA 12 11 Total gt Muffins gt Stuff Mart gt BLU 12 11 ee aca 2007 Jan 2009 Jan 2011 Jan BB History MM Forecasts MMM Forecast Interval Click on the different items in the Hot List and notice that as you do so the Navigator sel
221. other dialog boxes which allow you to customize the various Forecast Pro TRAC views With the exception of Settings gt Options which is described below all of the other menu options lead to dialog boxes that are described in detail in the Forecast Pro TRAC Interface chapter Settings gt Options Selecting Settings gt Options opens the Options dialog box which is used to change various Forecast Pro TRAC settings The Settings dialog box contains both a Set as Default button and an OK button Clicking the OK button will save your current settings for use with the current project Clicking the Set as Default button will save your current settings for use with the current project and also save them as the default settings for all new projects The Settings dialog box contains seven pages or tabs We will discuss each in turn oso _ a Basic Formats Outliers Ovenides Command Line Advanced Controls Pareto Analysis Input Data C Users Public Documents Forecast Pro TRAC Input Browse Projects C Users Public Documents Forecast Pro TRAC Projects Browse Output C Users Public Documents Forecast Pro TRAC Output Browse Allow negative forecasts Upper confidence ima 97 5 Forecast horizon 12 2 Lower confidence ima 25 Safety stock lead time 3 ox cnca Hep The Basic tab contains frequently accessed settings that every user should understand Input Data Specify the complete path name of the directory whe
222. othing or Box Jenkins will perform an out of sample test to select between these two approaches The cumulative MAD for Exponential smoothing was 150 and for Box Jenkins was 241 The rolling out of sample test used a maximum horizon of 6 and generated 21 forecasts for each method This is component project containing data for the United States Notice that the bottom right corner of the status bar indicates that this project is associated with a team archive If you hover over the team archive indicator a tool tip appears identifying the team archive as Lesson 4 Team Archive Teamdb Select File gt Open and open the project Lesson 4 Canada This is also a component file connected to Lesson 4 Team Archive Teamdb Open the project Lesson 4 Mexico to view the third component project As you have observed the component projects have all been forecasted and include some overrides Close the current project by selecting File gt Close Open the team archive directly by selecting Project gt Team Archive gt Open and selecting Lesson 4 Team Archive Teamdb Open the Override view and fully expand the Navigator 62 Collaborating With Colleagues AALI Units Default Forecast 7 733 9 876 9 256 t 10 631 10 639 8 744 11 886 8 762 8 123 8 269 7 059 9 550 PG1 204 5 109 977 110 528 9 211 7 059 11 886 Value is a direct override or adjustment Notice that opening
223. ould fall at or below the upper confidence limit about 95 of the time You can set the percentiles of both the upper and lower confidence limits Let s illustrate this idea with an example Suppose you were in charge of forecasting widget sales for your company If you wanted to determine expected revenues for next month you would be most interested in the point forecast since it is the mean value of the distribution The point forecast gives you the minimum expected forecast error 12 A Quick Overview of Forecasting On the other hand suppose you wanted to know how many widgets to produce If you overproduce warehousing costs will be excessive But if you underproduce you will probably lose sales Since the cost of lost sales is usually greater than the cost of overstocking you will be most interested in the upper confidence limit The upper confidence limit tells you how many widgets to produce to limit the chance of stocking out to less than 5 Forecasting Methodologies A wide variety of statistical forecasting techniques are available ranging from very simple to very sophisticated All of them try to capture the statistical distribution that we have just discussed Forecast Pro TRAC offers the five methodologies that are most appropriate for automated business forecasting simple moving averages discrete data models Poisson or negative binomial Croston s intermittent data model exponential smoothing and Box Jenkins A
224. output file Output a single Numeric Output file containing information for all forecasted items will be written If Single output file is not selected then a separate Numeric Output file will be written for each input file Break record up into lines If selected then each Numeric Output component specified on the Time Series Data tab see below will appear on a separate line of the Numeric Output file The Text Format section of this tab allows you to specify the conventions to use when outputting a text file You will only be able to edit these settings when the data mode is set to Txt text or Mit text input file format CS OOOO O O O Output Format Time Series Data Model and Statistics The Time Series Data tab is used to define the data label fields to select the forecast components to include and to set their precision If you are outputting a fixed width text file then you may also set the column widths 214 Command Reference Attributes Include separate attribute fields for each level of the hierarchy If you used attribute fields in your input data files to define groups then you will most likely want to select this option so that your output file will match your input file Consult the Setting Up Your Data chapter for a discussion of attribute fields Include record type Include a record type field that identifies which forecast component is being output This is useful if you use the Break record up into lines
225. oxes for the four Pareto fields List Percent of Total Rank Cumul Percent and click OK Notice that the Item report now includes the four fields associated with the Pareto analysis before we discuss these fields let s sort the report to make it easier to read Click the light blue Filter icon to activate the filtering and sorting mode Click on the filter dropdown for Ranking select Sort Smallest to Largest and click OK Your screen should now look like the one below Sorting and Filtering the Pareto Output 67 vp Forecast Pro TRAC Lesson 5 iii 7 TS i lt i a oo File Settings Operations Project View Wi 0665 0666 4 0662 0x o 000 Ms Stat Forecast Unlocked 2006 1 through 2011 gt 6 gt Holdout 0 Units Defaukt 3 Total 3 Muffins Stuff Mart COR 12 11 Stuff Mart BLU 12 11 COR 12 11 BRA 12 11 BLU 12 11 z ota uffins Food King BLU 12 11 APP 12 11 o uffins Food King APP 12 11 OAT 12 11 ota Muffins Stuff Mart COR 12 11 3 Sids Club o Sids Club BU 20 02 COR 12 11 ota akes Stuff Mart CH 20 01 BRA 12 11 o uffns Stuff Mart BRA 12 11 oes Sids Club LF 20 02 APP 12 11 Food King CH 20 01 3 Grocery Land COR 12 11 Food King CO 20 01 BLU 12 11 ol lu Stuff Mart OAT 12 11 APP 12 11 otal akes Stuff Mart CA 20 01 Food King Sids Club APP 12 11 COR 12 11 Daaa stna ssa an na BLU 12 11 APP 12 11 3 Cakes Total Total 3 Stuff Mart VA 20 01
226. pens the project allowing you to work on your project locally even though it was saved to a network drive When you resave your zipped project Forecast Pro TRAC will zip the updated local project files and save the updated FPZip file to the network drive To save and open zipped projects you select FPZip as the file type in the File gt Save as and File gt Open dialog boxes 162 Saving Your Work Numeric Output Files Numeric Output Files can contain time series output such as history forecasts fitted values and confidence limits as well as statistical output such as the forecasting model specification and summary statistics These files can be saved in text spreadsheet ODBC or XML formats You can include output for either all items forecasted or just for the Hot List Generally speaking if you will be importing the forecasts into another application these are the files you will want to use You can specify the format and content of Numeric Output File using Settings gt Numeric Output Design The operation of the Numeric Output Design dialog box is described in the Command Reference section of this manual You can preview the contents of the current Numeric Output File using the Numeric Output view You can open this view using View gt Numeric Output or using the yellow Preview Numeric Output icon 9 To save a Numeric Output file for all items forecasted select Project gt Export gt Full Numeric Output or click the purple Save N
227. pply button Notice the updated report now displays exceptions found during all forecast periods The next section Allowable deviation from history allows you to set the sensitivity of the exception thresholds Currently we are using global thresholds that will flag any deviation of more than 50 Change the global thresholds to minus 25 and plus 25 and click the apply button Notice that the updated report reflects the new thresholds In addition to the global thresholds Forecast Pro TRAC allows you to use item level thresholds so that you can assign different sensitivities to different items The item level thresholds must be defined in the secondary file and must follow specific naming conventions The details are found in the Setting Up Your Data section of this manual The next section of the display Comparison Basis allows you to set whether you want the thresholds to use percentages or units to set which historic point to compare the forecast with to base the comparison on either the final forecast which potentially includes user adjustments or the statistical forecast and to use either individual forecast points or the cumulative total for the specified range Our current settings which include a History periods prior setting of 12 will compare the forecast with the historic period 12 months prior 1 e the same period last year Monitoring Current Forecasts 77 The last section of the display Layout allows you to sho
228. process selecting the point or points to override entering the override s and committing to the override s Points can be selected in the override window or in the graph window The sum of the values for the points selected will be displayed in the Value edit box If you want to adjust the selected points by a certain percentage enter the percentage in the Percent edit box and press the button If you want to adjust each selected point by a certain increment enter the increment in the Increment edit box and press the button If you want to change the sum of the selected points to a defined value enter the value in the Value edit box and The Override Forecasts View 199 press the button Adjustments made using the edit boxes will appear in the target override row specified to the left of the Commit button You can also enter overrides for a single point by typing a new value into one of the override row cells or by using the right mouse button to drag it to the desired new value on the graph After you have entered the desired overrides and comments click the Commit button to accept the changes and reconcile the hierarchy For large complex hierarchies the reconciliation can take a little time To minimize the reconciliation time Forecast Pro TRAC supports a manual override mode When this mode 1s active the override window will include a Retain button as well as a Commit Button The Retain button is used to accept overrides without
229. project was saved allowing you to continue your work If you open a project and the data files are not available the project will restore the conditions present when the project was saved thus you can review projects make adjustments etc even if you do not have access to the data files This will often be the case when sharing projects with colleagues Project Options NN em Your data appear to have been modified since you last saved your project Would you like to reforecast using the updated data Do not recalculate the forecast Recalculate the forecast and apply V Project Settings v Modifiers Hot List v Overrides Cancel If you open a project and data files have changed a dialog box will appear allowing you to either generate new forecasts using the updated data or restore the conditions present when the project was saved 1 e do not recalculate the forecasts using the new data Project Files The project consists of either three or four separate data files The Project Settings File FPProj is an XML file containing the project settings and script definition The TRAC Database File db or TRAC is either a SQLite or Microsoft Access database file that contains information pertaining to the current forecast period and all previously archived forecasts The 64 bit version of Forecast Projects 161 Forecast Pro TRAC will always use SQLite database files The 32 bit version can use ei
230. r a new to world product prior to launch is extremely difficult Regardless of the forecasting method used you should be constantly revisiting your model assumptions as data becomes available and adjusting the model when appropriate This concludes Lesson 12 116 New Product Forecasting Lesson 13 Using Weighting Transformations Forecast Pro TRAC includes a weighting transformation which will divide your historical data by user defined weights forecast the resultant deweighted series and then multiply reweight the forecasts This procedure can be useful in a variety of situations including adjusting for the number of working days in a month defining a seasonal pattern and supplying a growth curve for a new product In this section we will use the weights procedure to adjust for the number of weeks in each month The section will conclude with a discussion of how to apply weights in other situations Adjusting for 4 vs 5 Week Periods It is not uncommon for companies to divide the year into twelve periods each consisting of either four or five complete weeks This is often referred to as a 4 4 5 calendar In situations where the forecasts ultimately need to be broken down by week this method may be preferable to using actual calendar months which include partial weeks 117 If the number of weeks in each period is consistent from year to year 1 e period always has 4 weeks period 2 always has 4 weeks period 3 always ha
231. r example columns E through G contain conversion factors columns H and I contain custom filter fields and the remaining columns contain item specific exception report thresholds If you will be using a table or query to hold the secondary information you ll want to examine the 23Bakery_Secondary table in the file 123 Bakery mdb COR 12 11 Stuf Mart BRA 12 11 Dollars Stuf Mart BLU 12 11 Dollars Muffins Stuf Mart APP 12 11_ Dollars Muffins Stuff Mart OAT 12 11_ Dollars Muffins _Sids Club COR 12 11_ Dollars Muffins Sids Club BRA 12 11 Dollars Muffins Sids Club BLU 12 11 Dollars Muffins Sids Club APP 12 11 Dollars Muffins Grocery Land COR 12 11 Dollars Muffins Grocery Land BLU 12 11 Dollars Muffins Grocery Land APP 12 11 Dollars Muffins Food King COR 12 11 Dollars Muffins Food King BLU 12 11 Dollars Muffins Food King APP 12 11 Dollars Cakes Stuff Mart VA 20 01 Dollars Cakes Stuff Mart _ST 20 02 Dollars Cakes Stuff Mart LF 20 02 Dollars Cakes Stuff Mart LE 20 02 Dollars Cakes Stuff Mart CO 20 01 Dollars Cakes Stuff Mart CH 20 01 Dollars Cakes Stuff Mart CA 20 01 Dollars Cakes Stuff Mart BU 20 02 Dollars Cakes Sids Club VA 20 01 Dollars Cakes Sids Club LF 20 02 Dollars Cakes Sids Club CO 20 01 Dollars Cakes Sids Club CH 20 01 Dollars Cakes Sids Club CA 20 01 Dollars Cakes Sids Club BU 20 02 Dollars Cakes Grocery Land VA 20 01 Dollars Cakes Grocery Land LF 20 02 Dollar
232. racy and ease of use Their robustness makes them ideal even when the data are short and or volatile Exponential smoothing works by identifying and extracting trend and seasonality and extrapolating them forward Box Jenkins is a more elaborate statistical method than exponential smoothing Box Jenkins works by capturing the historic correlations of the data and extrapolating them forward It often outperforms exponential smoothing in cases when the data are fairly long and nonvolatile However it doesn t usually perform as well when the data are statistically messy You can use Forecast Pro TRAC s expert selection to automatically choose the appropriate forecasting technique for each item forecasted Alternatively you can dictate that a specific method be used If you are already familiar with statistical forecasting you can use Forecast Pro TRAC to customize your models It provides extensive diagnostics and statistical tests to help you make informed decisions Forecast Pro TRAC includes three additional forecasting techniques that are not considered in expert selection event models forecasting by analogy and the Bass diffusion model Event Models are extensions of exponential smoothing models that allow you to capture responses promotions business interruption and other aperiodic events These models allow you to assign each period into logical categories and incorporate an adjustment for each category For example 1f you establis
233. rd MISSING instead of a number to indicate a missing value If you use zeroes to pad the data prior to an item s availability make sure that Ignore leading zeros is selected on the Formats tab of the Settings Options dialog box Using ODBC ODBC provides direct data communications between Forecast Pro TRAC and a wide variety of databases This is accomplished through intermediary ODBC drivers that lie between Forecast Pro TRAC and your database You must obtain the driver from the database manufacturer or a third party and install it according to the directions provided ODBC drivers are available for many database products including Access Oracle DB2 SQL Server FoxPro Paradox and Btrieve Database structure Forecast Pro TRAC reads data from structured tables or views defined in the database Ordinarily the tables created for the Forecast Pro TRAC interface are just a subset of the entire database Here is an example of a of a data table formatted for Forecast Pro TRAC Using ODBC 147 Table Tools 123 Bakery ODBC Copy Database Access 2002 Home Create External Data Database Tools Datasheet Security Warning Certain content in the database has been disabled Options Description Hist_Year Hist_Period Ppy Ppc Hist_Value a a CASE 12 count Corn Muffins 2005 6 12 12 1944 i COR 12 11 CASE 12 count Corn Muffins 2005 7 12 12 3888 COR 12 11 CASE 12 count Corn Muffins 2005 8 12
234. re the program should read data Projects Specify the complete path name of the directory where the program should write the project files Menu Items and Dialog Boxes 217 Output Specify the complete path name of the directory where the program should write all output files e g Numeric Output files forecast reports etc Data mode Select the type of data file that you will be using from the list of supported types Allow negative forecasts Most business data are inherently positive although there are exceptions like telephone connection gain or sales data that include returns as negatives Users with positive data are understandably disturbed when their forecasts turn negative This can occur when Forecast Pro TRAC captures a downward trend at the end of your historic data If Allow negative forecasts is turned off Forecast Pro TRAC will clip forecasts to zero that would otherwise be negative If Allow negative forecasts is turned on then Forecast Pro TRAC takes no special actions to avoid negative forecasts Forecast horizon Specify how many periods ahead you want Forecast Pro TRAC to forecast Upper confidence limit Specify the percentile for the upper confidence limits The upper confidence limit for a specific item can also be specified using the Upper modifier Lower confidence limit Specity the percentile for lower confidence limits The lower confidence limit for a specific item can also be specified using the
235. recast Report for COR 12 11 zs COR 12 11 CASE 12 count Corn Muffins APP 12 11 Cakes CASE 12 count Corn Muffins oy ee Total gt Muffins gt Stuff Mart gt COR 12 11 VA 20 01 ST 20 02 Raw hierarchy is Total gt Muffins gt Stuff Mart gt COR 12 11 Total gt Muffins gt Stuff Mart Expert Analysis s gt Sids Club Total gt Muffin Total gt Muffins gt Grocery Land Te s gt Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins Total Horne 4 Peston will perform an out of sample test to select between these two approaches Total gt Cakes gt Food King The cumulative MAD for Exponential smoothing was 3 037 and for Box Jenkins was 3 097 The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method This project uses the 123 Bakery data that we explored in Lesson 1 As you may recall the data were read in from an Excel file called 723 Bakery xls The spreadsheet contains sales for the different products measured in cases Thus cases is our default unit of measure The spreadsheet also defines the default hierarchy which in this example has four levels a total level a category level consisting of Muffins and Cakes a customer level and a SKU level The combination of our default units of measure displayed in our default hierarchy is referred to as our default state Notice that Default
236. reconciling the hierarchy In this mode you would typically enter and retain all of the overrides you wish to make 1 e for multiple items and then click Commit to perform the reconciliation The control to turn on manual override mode is found on the Overrides tab of the Settings gt Options dialog box The Tracking Report and Tracking Report Graph Views The Tracking Report view and its associated Tracking Report Graph view allow you to compare previously generated forecasts with what actually happened To view the Tracking Report your Forecast Pro TRAC database must contain archived forecasts To open the Tracking Report and Tracking Report Graph click the green Tracking Report and Graph icon 9 Alternatively you can open the individual views using View gt Tracking Report and View gt Tracking Report Graph 200 Command Reference p Forecast Pro TRAC Lesson 6 S rr o E o MiM File Settings Operations Project View Window Help F A Fr i i GOOGS SCO 6S4 eh Stat Forecast Unlocked 2006 1 through 2011 6 Holdout 0 gt Units Default X J e To F Lesson6 Tracking Report Waterfall Report for Total gt Muffins gt Stuff Mart 3 Stuff Mart COR 12 11 BRA 12 11 Adj forecast BLU 12 11 z Showing forecasts APP 12 11 OAT 12 11 e 2011 Jan 2011 Feb 2011 Mar 2011 Apr 2011 May 2011 Jun 3 Sids Club COR 12 11 een Dec 06 296 57 442 Bag 2 lt 26 30 006 yond S72 4 773 29
237. ric Mean of Relative Absolute Error This statistic 1s calculated using the relative error between the naive model and the currently selected model A GMRAE of 0 55 indicates that the size of the current model s error is only 55 of the size of the error generated using the naive model for the same data set In our example the GMRAEs for expert selection are lower than the GMRAESs for the moving averages further evidence that expert selection outperforms the moving averages This concludes Lesson 15 Comparing an Alternative Model 131 REFERENCE Chapter 1 Setting Up Your Data Forecast Pro TRAC requires historic data to be input in a specific format For many users the data format is an initial stumbling block on the way to success in forecasting their own data This usually happens when a user misunderstands some of the details of the data format This chapter explains the data formats supported by Forecast Pro TRAC advises you how to select a format and describes how to create the files If you read the material carefully and examine the sample data files that are shipped with Forecast Pro TRAC you will be up and running quickly The first two sections describe data requirements and the different data file formats After you have selected your file format consult the appropriate section for instructions on how to create the files Overview Forecast Pro TRAC works with historic time series 1 e sequences of values of a v
238. rigins to display The Outlier Report View The outlier report view lists items where outliers have been detected and or corrected To open the outlier report view select View gt Outlier Report or click the yellow View Outlier Report icon A The content and format of the report is controlled using the outlier report s context menu The context menu also allows you to print the currently displayed report and save it to Excel The Outliers tab of the Settings gt Options dialog box includes an Jnclude iteration statistics in reports option If this option is active the outlier report will include detailed statistics describing the outlier detection Consult the Forecast Pro Statistical Reference Manual for details The Numeric Output View The Numeric Output view displays the contents and format of the currently specified Numeric Output file When designing the Numeric Output file it is useful to have the Numeric Output view open 212 Command Reference Selecting Settings gt Numeric Output Design opens the Numeric Output Design dialog box which is used to specify the format and content of the Numeric Output file and the Numeric Output view The Numeric Output Design dialog box contains both a Set as Default button and an OK button Clicking the OK button will save your current settings for use with the current project Clicking the Set as Default button will save your current settings for use with the current project and also save t
239. rmalize the data for trading day effects e g 4 4 5 calendars number of working days per month etc To use the weighting transformation you must create a helper variable containing the weights Helper variables names must start or end with an underbar Helper variables are not forecasted and their values are not included in group totals Helper variables are used in conjunction with event models by analogy models and weighting transformations The following modifier is used to specify the weighting transformation The Weighting Transformation Modifier 181 Weights gt Select WG7 _X Use an weighting transformation _X is the name of the time series containing the weights The procedure divides each value of the specified time series by the corresponding value weight in _X It then forecasts the deweighted variable and multiplies the forecasts by their corresponding weights The weighting variable _X must span the entire history and forecast period for each variable to be forecasted Outlier Detection Correction Modifiers When you generate forecasts Forecast Pro TRAC uses the current settings in the Outliers tab to determine the default behavior for detection and correction or outliers There are three choices None Do not detect nor correct for outliers Detection only Detect and report outliers but do not correct for them 1 e base the forecasts on the uncorrected values Detection and correction Detect and correct o
240. s 1 Use the Detection only mode to identify the outliers 2 Use the Outlier Report view and the Graph view to review the detected outliers and determine whether a correction 1s warranted 3 Use the OUTLIER CORRECT modifier to correct the outliers that we feel should be corrected Make sure that the data mode 1s set to XLS and that the forecast horizon 1s set to 12 Create a script containing the single line 123 Bakery Read in the data and click the red Forecast icon to build the models When the calculations are complete click the yellow View Outlier Report icon A to open the outlier report view and turn off any other open views Reviewing the Outliers 123 File Settings omen Project View Window Help 0090058 6 6 EII IEO Stat Forecast Unlocked Ei Ewuh 2011 Ee E Hook OS Muffins amp Stuff Mart COR 12 11 COR 12 11 2009 Dec BRA 12 11 APP 12 11 2010 Sep BLU 12 11 Stuff Mart LF 20 02 2011 Jan APP 12 11 Grocery Land VA 20 01 2011 May OAT 12 11 Grocery Land CH 20 01 2008 Nov pot Sisk Grocery Land CA 20 01 2011 May COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 B Grocery Land COR 12 11 BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 Cakes Stuff Mart VA 20 01 se m XX Hier 1 2 3 4 Local Rea Notice that a total of 6 outliers have been detected and their current Status 1s Detected Correcting the Outliers
241. s Cakes Grocery Land LE 20 02 Dollars Cakes Grocery Land CO 20 01 Dollars Cakes Grocery Land CH 20 01 Dollars Cakes Grocery Land CA 20 01 Dollars Record Id O r of 1161 Datasheet View NUM Defining the Secondary File 153 Notice that the attribute fields are present Description 1s a text field containing either the conversion factor s name or the item specific exception report threshold s keyword see below ConvFactor is a number field with field size double containing either the conversion factor or the item specific exception report threshold Conversion factors The unit of measure used in the historic data file 1s used as the default unit of measure Forecast Pro TRAC allows you to define item level conversion factors 1 e multipliers which can be used to display the history and forecasts in alternative units e g dollars pounds etc You can name your conversion factors whatever you wish with two exceptions they cannot begin with the word filter and you cannot use the exception report threshold names described below Custom filter fields You can define custom filter fields in the secondary file These fields can be included in the report views and filtered like any other fields They can also be included in the numeric output file The custom filter field names must begin with the word filter You can include filter values for both end items and groups Item level exception report thresholds
242. s the length of the forecasts forecast horizon and can tell Forecast Pro TRAC whether or not to allow negative forecasts The data for this lesson were copied into your Forecast Pro TRAC input folder when you installed the program normally Forecast Pro TRAC Input in your Shared Documents folder Make sure that the Input Data directory is set correctly and that the other options match those shown above Click the OK button to accept the defaults and return to the main menu 22 The Basics If you are using a Forecaster license proceed to the next section Defining the Script If you are using a Collaborator license the next three sections Defining the Script Reading in the Data and Generating the Forecasts describe operations that are not supported The first step in a Collaborator session is to open a forecast project that was created by someone using a Forecaster license Select File gt Open and open the forecast project Lesson 1 then skip the next three sections and proceed to the Viewing the Forecast Report section Defining the Script The next step is to define the script The script lists the data file s you wish to forecast In this example we will prepare sales forecasts for 123 Bakery The data consist of monthly sales of Muffins and Cakes Click the red Script icon 9 to call up the Define Script dialog box shown below C Users Public Documents Forecast Pro TRAC Input You can t
243. s 5 weeks etc then the variation due to the number of weeks in each period will be captured as part of the seasonality and no special action is required In cases where the number of weeks in each period varies from year to year 1 e some years period has 4 weeks other years it has 5 a weighting transformation can be used to capture the variation due to how many weeks are in each period The procedure is very straightforward You construct a weighting variable that classifies each period of the historical data and forecast period as containing either 4 or 5 weeks Forecast Pro TRAC divides the historical data by the weights This converts sales per period into sales per week per period This deweighted series is forecasted The forecasts are then reweighted by multiplying by the corresponding weights The data for this exercise are contained in two Excel files 4 4 5 Data xls contains five time series that were collected using twelve 4 or 5 week periods per year The number of weeks per period is not consistent from year to year 4 4 5 Helper xls contains the helper variable _Weeks Helper variables are either weighting variables or event variables They are identified by the use of a preceding or trailing underbar They can either be placed in the same data file as the series they are helping or placed in their own separate file In this example the helper variable _Weeks contains the number of weeks in each period It covers the his
244. s per year Must be an integer TM OA w gt Periods per seasonal cycle Must be an integer See the Overview section at the beginning of this chapter for more details on these items The time series data begin in column G The starting year column C and starting period column D refer to the year and period for column G whether or not that cell actually contains data Thus in the example spreadsheet the first value for PG 204 2 is for January 2003 in column I even though the header defines the starting period as 11 and the starting year as 2002 142 Setting Up Your Data Column format If your data are already stored by columns you will want to consider the column format first You can probably alter your spreadsheet to the Forecast Pro TRAC row layout in just a few minutes In column format each time series occupies a single column on the spreadsheet The data are assumed to reside in the topmost first spreadsheet in the workbook unless an alternate sheet has been specified by naming it BFSDATA Column A of the spreadsheet is devoted to row headings The keyword description must be used as the row heading for the description row The other cells in column A are ignored by Forecast Pro TRAC You can use them for titles calendar information etc Here is an example of a column format spreadsheet T EE ne e gt A SKUs manual V XLS Compatibility Mode Microsoft Excel Home Insert Page Layout
245. s tab is fully documented in the Menu Items and Dialog Boxes section of this Command Reference chapter p Forecast Pro TRAC Prop CS T File Settings Operations Project View Window Help 000655664 oB H OOOO BS orecast Locked Units Defaut 3 Total 3 Muffins 3 Stuff Mart COR 12 11 sep Oct Nov Dec Mar Awr may 16 457 ar 19 715 18318 36746 23072 11 234 14143 12264 6565 i f BRA 12 11 Inherited overrides BLU 12 11 z APP 12 11 OAT 12 11 Ovemide3 b Sids Club 545 8459 16457 19 715 18318 36 746 23072 11234 14143 12264 6565 8 628 COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 s Value 6 545 x Help J Grocery Land History Converted forecasts COR 12 11 BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 COR 12 11 CASE 12 count Com Muffins 2010 Jan 2011 Jan E Forecasts EE Forecast Interval Total gt Muffins gt Sids Ciub gt APP 12 11 Rea There are five rows in the example shown above Statistical contains the statistically based forecasts generated by Forecast Pro TRAC prior to any overrides being applied 198 Command Reference The Inherited Overrides row 1s only present if your project has changed states i e you have either switched units of measure or have rearranged the hierarchy When you change states it 1s not always possible to maintain t
246. s to color code The selected color coding is used on both the numeric and graphical displays The Tracking Report and Tracking Report Graph Views 203 The Item Report View The item report can contain Pareto information statistical output such as the forecasting model specification and summary statistics as well as time series output such as history forecasts fitted values and confidence limits To open the Item Report view select View gt Item Report or click the yellow View Item Report icon 0 If you double click an item on the Item Report the Navigator will jump directly to that item Thus you can use the Item Report as the equivalent of a Hot List to navigate through the listed items All of the global report views yellow icon views support this kind of navigation The content and format of the report is controlled using the Item Report Design dialog box This dialog box is invoked by selecting Settings gt Item Report Design or by selecting Item Report Design from the Item Report view s context menu The Exception Report View The Exception Report view enables you to quickly find cases where your forecast error or some other performance metric has fallen outside of an acceptable range Exception reporting reduces the need for manual review of your forecasts and allows you to focus on the items where human attention is most needed Forecast Pro TRAC provides a wide array of exception reports some of which monitor the
247. s to define a hierarchy section below The header consists of the first six items Variable name Up to 256 characters enclosed in quotes Variable description Up to 256 characters enclosed in quotes Starting year Must be an integer Starting period Must be an integer Periods per year Must be an integer Periods per seasonal cycle Must be an integer See the Overview section at the beginning of this chapter for more details on these items The remaining fields contain historic data Each time series is terminated with a semicolon and the file 1s terminated with two semicolons The one time series per line format illustrated above is easy to read however keep in mind you can use any combination of rows and columns Formatting rules Keep the following points in mind when you are creating your MLT files The record headers variable name field and variable description field must always appear in quotes If you are not using attribute fields each variable name must be unique If you are using attribute fields each variable name within a given group must be unique If you plan to use commas to separate items or as place holders for large numbers you will need to set a few options on the format tab of the Settings Options dialog box to insure that they are interpreted correctly 146 Setting Up Your Data Be careful not to use dollar signs page breaks or other symbols that may confuse Forecast Pro TRAC Use the wo
248. se Essentially this is a form of simulation that allows you to initialize the forecast archive with statistical forecasts Initialize archive J entins s jakiz When you select Operations gt Initialize Archive the Initialize Archive dialog box appears allowing you to specify how many periods you wish to initialize Forecasts will be generated for the specified period and all subsequent periods up to the current origin In the example above the periods to initialize is set to 12 which corresponds with a forecast origin of June 2008 Thus the initialization would begin by generating forecasts using data up to and including June 2008 and inserting 228 Command Reference them into the database It would then generate forecasts using data up to and including July 2008 and insert them into the database It would continue this process until all 12 forecasts sets had been generated and inserted into the database Operations gt Archive Forecasts Operations gt Archive Forecasts writes the forecasts and other information to the Forecast Pro TRAC database By default Forecast Pro TRAC will automatically archive the forecasts when you save the project This option is usually used by individuals who have elected to turn off the Archive forecasts automatically option This task can also be accomplished using the blue Archive Forecasts icon Operations gt Time Fence gt Enable Operations gt Time Fence gt Enable turns on the ti
249. splayed forecasts represent bottom up adjusted values not actual forecasts using the model shown Expert selection Exponential smoothing No trend Multiplicative seasonality NM 0 125 0 327 Confidence limits proportional to indexes and level Final Value 0 1249 5 690 0 8837 0 8960 0 5235 0 7180 0 6982 1 661 1 157 2 682 Within Sample Statistics Read XZ Hier 1 2 3 4 Local You are currently looking at a standard format Forecast Report The Forecast Report can be customized and can include up to ten sections They are Viewing the Forecast Report 27 Expert Analysis documents the logic behind the expert selection s decision This section will be omitted if a user specified forecasting model is used Model Details documents the specific forecasting model that was used to generate the forecasts Within Sample Statistics provides a set of standardized model statistics that can be used to diagnose the current model as well as to compare and contrast alternative forecasting approaches Historic Data not currently active lists the history and fitted values along with some aggregated totals and summary statistics Forecast Data lists the forecasts and confidence limits along with some aggregated totals and summary statistics Converted Forecasts not currently active lists the forecasts in all the display units that are defined in the secondary file Safety stocks not currently active lists the safety stocks f
250. st Pro TRAC s default model selection procedure In this lesson you will use forecast modifiers to dictate the forecasting models to be used for specific items Specifying Forecast Modifiers for Individual Items Start up the program and click the red Script icon 9 to call up the Define Script dialog box Double click on ACME Hardware to place it on the first line of the script Click OK to accept the script Click the red Read Data icon B to read in the data and then the red Forecast icon to generate the forecasts Fully expand the Navigator using the Expand All option on its context menu and open the Graph view by clicking its green icon Select Total gt USA gt PG1 204 2 Your display should now match the one shown below 87 oject04 _ File Settings Operations Project View Window Help 060000064 086 Ow GOOO JA Stat Forecast Unlocked 11 Soh 2011 gt 1 Holdout 0 Units Defaut 3 Total 3 USA PG1 204 1 PG1 204 2 Cases GFCI Ivory o PG1 204 2 PG1 204 3 PG1 204 4 PG1 204 5 2010 Jan 2011 Jan PG1 204 3 E History E Forecasts MMM Forecast Interval PG1 204 5 Project04 Forecast Report oles Forecast Report for PG1 204 2 a Cases GFCI ory Total gt USA gt PG1 204 2 Raw hierarchy is Total gt USA gt PG1 204 2 Expert Analysis Using rule based logic I have narrowed down the choice to exponential smoothing or Box Jenkins wil perform an out of sample
251. st origin was May 2011 and the first forecast period was June 2011 The waterfall report allows you to color code lead times A lead time refers to the number of periods ahead of the forecast origin the forecast was made for Thus a one month ahead forecast would have lead time equals 1 a two month ahead forecast would have lead time equals 2 etc The Tracking Report and Tracking Report Graph Views 201 In our example the forecasts for lead time equals 1 are all shaded in blue the forecasts for lead time equals 3 are all shaded in maroon the forecasts for lead time equals 6 are all shaded in yellow The color coding is used on both the tracking report and the tracking report graph You can control the lead times to color code using the Tracking Report Settings dialog box The bottom portion of the report displays cumulative statistics for different lead times Forecast Pro TRAC Lesson File Settings Operations Project View Window Help 0666 55 65 4 OG6GG 04 6 OOO BG Stat Forecast Unlocked gt through 2011 6 gt Holdout 0 gt Units Default 3 Total A F Lesson 6 Tracking Report Stuff Mart Origin K setae 2010 Dec 200 710 149 578 113 560 99 499 123 451 BLU 12 11 z 2011 Jan Mezas i 149 113 385 97 720 122 623 APP 12 11 2011 Feb WAEZISI 109 156 32270 119 410 OAT 12 11 2011 Mar 104 432 90 475 misas 3 Sids Club 2011 Apr 1021225 122 658 COR 12 11 2011 May 118 715 BRA 12
252. t s database will contain forecasts that were generated in previous months This record of previously generated forecasts is referred to as a forecast archive Maintaining a forecast archive allows you to track your forecast accuracy by comparing the forecasts that you generated previously to what actually happened In this lesson we will explore Forecast Pro TRAC s tracking report and tracking graph views which are the primary vehicles for making this comparison Reading the Tracking Report Start Forecast Pro TRAC select File gt Open and open the project Lesson 6 This project contains forecasts for the muffins and cakes data that we worked with in previous lessons 71 Fh Forecast Pro TRAC Lesson File Settings Operations Project View Window Help 99921900940008 czer 7000A Stat Forecast Unlocked gt though 2011 gt 6 gt Holdout 0 Units Defaut 3 Total Muffin SN La COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 OAT 12 11 3 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 Grocery Land COR 12 11 BLU 12 11 APP 12 11 Food King COR 12 11 BLU 12 11 APP 12 11 COR 12 11 CASE 12 count Corn Muffins Stuff Mart VA 20 01 ST 20 02 Joi gt Cakes rahe 2008 Jan Jan 2010 Jan 2011 Jan Total gt Cakes gt Grocery Land Total gt Cakes gt Food King BE History HM Forecasts MM Forecast Interval Rea Notice that for the curre
253. t for the program to reconcile after each item that you override Number of adjustment rows This setting controls the number of adjustment rows displayed in the Override view Allow disaggregation If this switch is on the Override window will include a Disaggregate to drop down box allowing you to disaggregate 1 e push down any overrides made at a group level to a lower level of the hierarchy The disaggregation 1s based on a proportional allocation Number of periods This option allows you to set the default length for the time fence This setting can be overridden on an item by item basis using the YTIMEFENCE modifier ono I Basic Formats Outiers Overrides Command Line Pareto Analysis Advanced Controls Project Components to Apply V Modifiers V Settings V Overides 222 Command Reference Forecast Pro TRAC supports command line operation allowing you to create forecasts in a hands off mode For a complete description of how to run the product from the command line consult the Operating From the Command Line lesson in the tutorial and the Command line Operation section of this chapter The Command Line tab allows you to dictate the options to apply if the current project 1s run via the command line The first three options control how the forecasts are generated when the project is run from the command line Modifiers If this option is selected the project s forecast modifiers if an
254. t Stuff Mart on the Navigator and right click to bring up the Navigator s context menu and select Add to Hot List Notice that there is a full range of options to add items to the Hot List Children Parents and Siblings refer to one level down on the current branch one level up on the current branch and the same level on the current branch respectively In the Analysis menu selection Overrides refer to items with direct overrides and Affected refers to items with indirect overrides 1 e items where a direct override elsewhere in the hierarchy changed the items forecast Experiment with adding and removing items from the Hot List until you are comfortable with its operation Clear the Hot List select Total gt Muffins gt Stuff Mart on the Navigator invoke the Navigator s context menu and select Add to Hot List gt This Level Your screen should now match the display below Working With a Hot List 35 File Settings Operations Project View Window Hel 0006 06 66 4 06864 00 Jt Stat Forecast Unlocked 2006 1 H through 2011 6 H Holdout 0 AERA CAA Unts Defaut 3 Total FJ Project03 Graph 3 gt TASEN COR 12 11 123 Bakery Inc BRA 12 11 Stuff Mart Customer BLU 12 11 APP 12 11 OAT 12 11 ee EE NNE EEA O E EE E EEEE EEEE CE COENE 3 Sids Club COR 12 11 BRA 12 11 BLU 12 11 APP 12 11 3 Grocery Land COR 12 11 BLU 12 11 APP 12 11 3 Food King COR 12 11
255. t we ll open up a project that is included with Forecast Pro TRAC Start Forecast Pro TRAC select File gt Open and open the project Lesson 4 part 1 The data in this project represent sales of different types of cameras and film p Forecast Pro TRAC Lesson 4 part File Settings Operations Project View Window Help OCSGSSS SSG Oea 0 24 46 OOO 4G Stat Forecast Unlocked 2007 1 through 2011 gt 2 gt Holdout 0 Acme Cameras Fj Lesson 4 part 1 Forecast overrides ASA100 BW 7 970 6648 11936 7 655 6585 11 291 10918 11 956 7 664 ASA100 Color Lesson 4 part 1 Graph X Notice that we did not define a script read the data or click the forecast button When we opened the forecast project Forecast Pro TRAC restored the script forecasts overrides and Hot List that were present when the forecast Sharing a Stand alone Project 59 project was saved The person restoring the forecast project does not even need to have access to the files containing the historical data that were used to generate the forecasts the only thing he or she needs is the forecast project files Notice that the person who created the forecasts entered some overrides in June July and August For convenience let s refer to the person who created this file as John Notice also that the background color for these cells is yellow This indicates that the cells co
256. tain a report for every item for which at least one archived forecast is available You can save Tracking Reports for the items on the current Hot List only using the Hot List s context menu Save Numeric Output Allows you to save a Numeric Output file to disk The file will contain output for every item forecasted You can save a Numeric Output file for the items on the current Hot List only using the Hot List s context menu Apply Filters Turns on and off report filtering mode Filtering mode allows you to filter and sort the item exception override and outlier reports Options Opens the Options dialog box allowing you to change the settings for the current forecast project The Dialog bar The dialog bar is used to display the current script line to set the span of the data to define a holdout sample and to change the display units Defining the fit set All time series methods begin by fitting the coefficients of a model to historic data You can alter the beginning year and beginning The Forecast Pro TRAC Interface 189 period to specify the first point of the fitting sample and or the ending year and ending period to specify the last point The dialog bar automatically selects the largest fit set for which data exists Normally you will want to accept the defaults However you may want to ignore earlier data if you distrust their relevance Defining a holdout sample Edit the holdout sample box to specify a number
257. tatistical analyst It performs a series of statistical tests interprets the results performs more tests if necessary and finally makes recommendations based upon the results Expert selection works well for most applications However Forecast Pro TRAC also allows you to customize your script by adding modifiers to the Navigator A modifier on a particular item gives Forecast Pro TRAC instructions on how to create the forecasts for that item We will explore the use of modifiers in Lesson 9 Viewing the Forecast Report Let s take a closer look at Forecast Report view Turn off the Graph view by clicking its green icon Forecast Pro TRAC Project03 File Settings Operations Project View Window Help COGS SS alegava 8B OOO 86 J4 Stat Forecast Unlocked 2006 1 gt though 2011 6 Holdout 0 Units Default X Total Fh Project03 Forecast Report Expert Analysis gt ETAN COR 12 11 BRA 12 11 BLU 12 11 will perform an out of sample test to select between these two approaches Using rule based logic have narrowed down the choice to exponential smoothing or Box Jenkins APP 12 11 OAT 12 11 The cumulative MAD for Exponential smoothing was 9 265 and for Box Jenkins was 17 579 Sids Club The rolling out of sample test used a maximum horizon of 12 and generated 78 forecasts for each method Food King Based on the lower MAD will use Exponential Smoothing Model Details Warning di
258. terfall report allows you to highlight different lead times A lead time refers to the number of periods ahead of the forecast origin the forecast was made for Thus a one month ahead forecast would have lead time equals 1 a two month ahead forecast would have lead time equals 2 etc Notice that the forecasts for lead time equals 1 are all shaded in blue the forecasts for lead time equals 3 are all shaded in maroon the forecasts for lead time equals 6 are all shaded in yellow and that the same color coding is used on the tracking report graph You can control the lead times to color code using the Tracking Report Settings dialog box Reading the Tracking Report 73 The bottom portion of the report displays cumulative statistics for different lead times Customizing the Tracking Report Right click on the tracking report to invoke the context menu and select Tracking Report Settings Notice that you can choose to view either the statistical or adjusted forecasts This allows you to determine if your adjustments are adding value You can also opt to view the forecasts themselves or the errors or the percent errors Select Percent error and click the Apply button Notice that the display is updated accordingly Click the Include preceding forecasts option and click Apply This will display all archived forecasts that go into the cumulative statistics rather than just the subset in the triangular display The Analysis
259. test to select between these two approaches The cumulative MAD for Exponential smoothing was 150 and for Box Jenkins was 241 al H z The rolling out of sample test used a maximum horizon of 6 and generated 21 forecasts for each method If you do not instruct Forecast Pro TRAC to use a specific forecasting technique it will use expert selection to select the appropriate technique for each item forecasted If you examine Total gt USA gt PG1 204 2 s forecast report you Il notice that it includes an Expert Analysis section and that expert selection chose to forecast this item using a nontrended seasonal exponential smoothing model Let s say that we wish to dictate that a Winters exponential smoothing model be used for this item Winters is a form of exponential smoothing which includes both a trend and seasonal component To specify the model right click on Total gt USA gt PG1 204 2 to bring up the Navigator s context menu and then select Model gt Exponential Smoothing gt Winters 88 Using Forecast Modifiers o Forecast Pro TRAC Projet 4 E e Sm File Settings Operations Project View Window Hel 00060566464 60664 0 4 00008 Stat Forecast Unlocked 2007 11 Units Default PG1 204 2 Cases GFCI Ivory Notice that WINTERS now appears next to Total gt USA gt PG1 204 2 on the Navigator WINTERS is a forecast modifier In this instance it is used to indicate that you have opted
260. th July s sales open last month s project and generate new statistical forecasts Our 3 month time fence will now cover August through October August and Septembers time fenced values will be retained from last month s time fenced values and October s time fenced value will equal last month s final forecast for October Time Fence Settings and Options Turning on the time fence When you first create a project the time fence will be turned off You turn the time fence on by selecting Operations gt Time Fence gt Enable Once you turn a project s time fence on it cannot be turned off Basic Formats Outliers Overides Command Line Advanced Controls Pareto Analysis Settings Adjustment mode Overide incremental Manual reconciliation mode Number of adjustment rows 3 Setting the length of the time fence The default length for the time fence can be specified on the Override tab of the Options dialog box shown above You can override the global setting on an item by item basis using the custom modifier 7TIMEFENCE n where n is the number of periods you wish to use Be aware that if you use the V7JMEFENCE modifier to create a time fence shorter than the global time fence it will shorten the time fence for all associated parent groups of the item Using a Time Fence 237 Freezing the next period Selecting Operations gt Time Fence gt Freeze Next Period will increase the length
261. than shipments which are subject to production delays warehousing effects labor scheduling etc Many corporations are making large investments to obtain data as close to true demand as possible The more data you can supply the program the better Statistical forecasts generated from very short series are simplistic and usually not very accurate Although collecting additional data may require some effort it is usually worth it If your data are seasonal it is particularly important that you have adequate data length The automatic model selection algorithms in Forecast Pro TRAC will not consider seasonal models unless you have at least two years worth of data This is because you need at least two samples for each month or quarter to distinguish seasonality from one time irregular patterns Ideally you should use three or more years of data to build a seasonal model Finally remember that forecasts are never perfect Forecast Pro TRAC bases its forecasts solely on the past history of your data If you know something that Forecast Pro TRAC did not then you may want to adjust the forecasts Some Forecasting Tips 15 judgmentally For instance you may know of future events like a large upcoming sale or the introduction of a new product You can use the quantitative forecasts as a starting point and apply your own insight and knowledge of future events to improve them 16 A Quick Overview of Forecasting TUTORIAL General Operations
262. the Toolbar which includes buttons for some of the most common commands in Forecast Pro TRAC A check mark appears next to the menu item when the Toolbar is displayed View gt Status Bar View gt Status Bar displays and hides the Status Bar which describes the progress of the currently running forecast job or the action to be executed by Menu Items and Dialog Boxes 233 the selected menu item or depressed toolbar button A check mark appears next to the menu item when the Status Bar is displayed View gt Modifiers View gt Modifiers displays and hides the currently selected forecast modifiers on the Navigator View gt Apply Filters View gt Apply Filters toggles on or off the report filters This can also be accomplished using the blue Filter icon The Window Menu The Window menu enables you to arrange your open windows in various ways Window gt Cascade Window gt Cascade arranges all nonminimized windows in an overlapped fashion Windows Tile Window gt Tile arranges all nonminimized windows in a tiled nonoverlapped fashion The Help Menu Forecast Pro TRAC includes extensive on line help Help gt Help Topics Help gt Help Topics displays an index of all of the help topics available Clicking on an entry will jump to the selected topic 234 Command Reference Help gt User Guide PDF Help gt User Guide PDF accesses a pdf version of the Forecast Pro TRAC User s Guide Help gt User Guide PDF H
263. the team archive allows you to review and manipulate the consolidated project This exercise was designed to provide an introduction to team archives Setting up and maintaining team archives is reasonably complex so if you are planning on using team archives you should read the Working with Team Archives chapter of the Reference section of this manual carefully Business Forecast Systems and Forecast Pro distributors also offer consulting services to help you establish your forecasting process Exit Forecast Pro TRAC without saving changes to the Lesson 4 Team Archive Teamab This concludes Lesson 4 Working with Team Archives 63 Lesson 5 Pareto Analysis and Report Filtering Pareto analysis is used to assign ABC classifications to your forecast items Typically important high volume items are categorized as type A medium volume items are categorized as type B and slow moving items are categorized as type C Thus the code indicates the relative importance of an item and many organizations adopt different procedures for creating reviewing and monitoring their forecasts based upon the codes Forecast Pro TRAC can automatically assign items into ABC categories based upon their volume Alternatively you can create a custom filter to define the classifications In this lesson we will explore both approaches and also illustrate how sorting and filtering reports on the Pareto output can be extremely useful Defining
264. ther SQLite or Microsoft Access and you can specify which database file type to use on the Advanced tab of the Options dialog box The setting can only be changed on a new project prior to reading in the data The Project Tables File mdb is a Microsoft Access database file containing separate tables for the in place overrides comments forecast modifiers and Hot List This file is only created when using Access database files The Project Snapshot File cb is a binary file that saves the forecast components that are currently in memory e g the forecasts summary Statistics etc so that the session can be restored without having to read in the data recalculate the forecasts etc This allows you to return to your session where you left off and to share the session with others When sharing projects with others you need to provide all the project files Using Zipped Projects to Improve Performance In some networked environments working with projects stored on a network drive can be substantially slower than working on a project stored locally To improve performance in these cases Forecast Pro TRAC supports zipped projects When you save a zipped project Forecast Pro TRAC zips the project files described in the previous section into a single file with the extension FPZip When you open a zipped project Forecast Pro TRAC copies the zipped file from the network drive to a local workspace unzips the project files and o
265. this works The project we will use is very similar to the project we looked at previously the only difference is that it contains overrides both in the base state and after converting to dollars Thus the project was saved when the statistical forecasts were locked Start Forecast Pro TRAC select File gt Open and select the project Lesson 3 part 2 The dialog box below appears ee Ki u last saved your 52 Updating a Forecast Project Select Recalculate the forecast and apply Notice that the option to automatically load the overrides is greyed out This is because the project was saved in a state where the statistical forecasts were locked Click OK Forecast Pro TRAC will read in the revised data and generate new forecasts Click on the yellow View Override Report icon PA to open the override report view Right click the override report view to bring up its context menu and select Override Report Design Report Style Tabular isplay In place nehu de Pareto statistic Current origin amp current project Last origin amp current origin Custom Sasa Gea ob Select Last origin amp current origin and click OK This will display the override sets associated with the current forecast period and the previous forecast period This is a useful display to view when you are loading override sets Forecast Pro TRAC Lesson File Settings Operations Project View Window Help 0606556664066
266. tify BFS in writing that You have removed the Software from your Computer and destroyed all copies If You do not End User License Agreement 253 comply with these return and notification requirements within thirty days 30 of your receipt of the Software You will not be entitled to a refund of any license fees You paid 2 OWNERSHIP BFS retains title ownership and all rights and interests in and to the Software documentation and all other materials supplied by BFS BFS does not sell the Software or any copies thereof but only grants limited licenses to use the Software in accordance with the terms of this EULA 3 GRANT OF LICENSE Upon acceptance of this EULA BFS grants You a non transferable non exclusive limited right to use this copy of the Software You may use the Software and the associated documentation only in connection with one Computer You may physically move the Software from one Computer to another provided that the Software is used on only one Computer at a time You may not move the Software electronically from one Computer to another over a network This license is granted for use by an individual Authorized User and in no event shall there be more than one Authorized User on the Computer where the Software is installed e g there shall be no common sharing of a Forecast Pro computer Each Authorized User must have a separate license to use the Software on his or her Computer 4 LICENSE RESTRICTIONS
267. tion of the groups Retail and Commercial Note the assumptions behind this approach We have assumed that the nested items are statistically similar so that we can obtain better forecasts of the groups Retail and Commercial by forecasting them as a unit However the forecast models for these two groups are judged as distinct compared to the irregularity Thus the best forecasts of Brand are obtained by direct aggregation of the two member groups It would be illegal to add the modifier YTOPDOWN to the line defining BRAND unless we remove the TOPDOWN modifiers from the two member groups In this case the entire hierarchy would be reconciled using top down aggregation Usually in a hierarchy involving three or more levels of aggregation you will want to place the TOPDOWN modifiers somewhere near the middle Reconciling the Hierarchy 171 Two things happen as we move from item level data upwards through the hierarchy The effects of irregularity decrease through aggregation Statistical models become more complex and distinct from each other Thus the signal to noise ratio increases as we move upwards through the hierarchy Now consider the case where both the TOPDOWN and INDEXES keywords are used for Retail and Commercial In this case Forecast Pro TRAC extracts seasonal indexes for these groups at the group level It then deseasonalizes each item level history by using the indexes from the parent group forecasts the resulting nonse
268. tistical output such as the forecasting model specification and summary statistics These files can be saved in text spreadsheet ODBC or XML formats You can include output for either all items forecasted or just for the Hot List Generally speaking if you will be importing the forecasts into another application these are the files you will want to use Formatted Forecast Reports can be saved to Excel You can save these reports for the currently displayed item all items on the Hot List or all items forecasted The Excel workbook will include a separate worksheet for each 159 item containing a graph optional and the on screen Forecast Report These reports are convenient if you wish to present the forecasts and or models used to colleagues Tracking Reports can be saved to Excel You can save these reports for the currently displayed item all items on the Hot List or all items forecasted The Excel workbook will include a separate worksheet for each item containing a graph optional and the on screen Tracking Report These reports are only available if the database includes at least one archived forecast for the given item The tem Report can be viewed on screen and saved to Excel This report can contain Pareto information statistical output such as the forecasting model specification and summary statistics as well as time series output such as history forecasts fitted values and confidence limits The Override Report can be vie
269. tive MAD for all horizons up to and including the current horizon Examining the Analytic Output 129 MAPE is the Mean Absolute Percentage Error for the horizon over all series on the current script line Cumulative MAPE is the cumulative MAPE for all horizons up to and including the current horizon GMRAE is the Geometric Mean of Relative Absolute Error for this horizon Below Upper Limit is the fraction of times that the actual was at or below the upper confidence limit as set in Settings Options This allows you to calibrate the empirical upper limit to the theoretical upper limit This is useful when you are using the upper limit to set stocking levels Figures listed in the row below the last forecast horizon refer to all horizons Each group on the Navigator will produce such a report Comparing an Alternative Model Right click Monthly on the Navigator to display the context menu Select Model gt Very Simple Models gt Simple Moving Average and set the number of terms to 3 Then right click Monthly a second time and select Apply Modifier s to gt All items We have now forecasted all items using a 3 month simple moving average Select the group Monthly on the Navigator and view the Out of Sample Rolling Evaluation for Items in Group section of the Forecast Report view 130 Out of sample Testing P3 Forecast Pro TRAC Proj CS Sl File Settings Operations Project View Window Hel 00900500820802 0044 O 000106 Stat Forec
270. tive adjustment of 172 Working with Scripts and Hierarchies negative values may have a different effect than one expects a seasonal index of 1 5 to a sales figure 100 yields the value 150 Top down adjustment is also problematic when negative forecast values are involved Therefore Forecast Pro TRAC clips negative forecasts to zero if you have specified top down disaggregation regardless of how you have set Allow negative forecasts in the Options dialog box in the Settings menu Reconciling the Hierarchy 173 Chapter 4 Using Forecast Modifiers By default Forecast Pro TRAC will automatically select a forecasting model for each item on the Navigator using expert selection The expert selection option works extremely well and is the method of choice for the majority of Forecast Pro TRAC users The expert selection algorithm is described in the Forecast Pro Statistical Reference Manual Alternatively you can dictate the models and or forecasting options using forecast modifiers Forecast modifiers are added to items on the Navigator using the Navigator s context menu This chapter documents the available modifiers A complete listing of the available modifiers is also found in the on line help system Model Specification Modifiers Model specification modifiers are used to dictate that a specific model be used for the time series Supported modifiers are listed below grouped by model type 175 Expert Selection Model
271. to use a Winters exponential smoothing model for this item rather than expert selection Examine the forecast report to verify that the Winters model was used You ll notice that the Expert Analysis section is no longer present and that the Model Details section indicates that a User Defined WINTERS model was built Select Total gt USA gt PG1 204 4 on the Navigator Right click to call up the context menu and select Model gt Very Simple Models gt Same as Last Year gt Plus Percent Specify the percentage as 10 and click OK Notice that SALYP 10 now appears next to Total gt USA gt PG1 204 4 on the Navigator This model will set the forecasts to equal the same values as the preceding year plus 10 Specifying Forecast Modifiers for Multiple Items Select the group Total gt Canada on the Navigator Right click to call up the context menu and select Model gt Box Jenkins gt Auto Notice that BJ now appears to the right of the group Total gt Canada Specifying Forecast Modifiers for Multiple Items 89 Let s say that we wish to dictate that a Box Jenkins model be used for every item in the group Canada To accomplish this select Apply Modifier s To gt Children on the Navigator s context menu Notice that the BJ modifier now appears on all of Total gt Canada s children 1 e all items one level down in the group Total gt Canada Specifying Custom Forecast Modifiers In addition to the commonly used forecasting
272. torical span as well as the forecast period Select Settings gt Options and make sure that the data mode is set to XIs and that the forecast horizon is set to 12 Create a script containing the two lines 4 4 5 Data 4 4 5 Helper Read in the data and click the red Forecast icon to build the models When the calculations are complete make sure that the Graph and Forecast Report views are open the fitted values are included on the graph and view the results for Product 1 shown below Notice that a seasonal model is selected and that the adjusted R square is 0 50 118 Using Weighting Transformations File Settings Centon re View Window Help 0088o 15 9 AO I ALLE 000S Stat Forecast Unlocked i1 gt though 2011 10 Holo 0 Product 1 Sales in thousands Mhag MMM Forecast Interval 9 445 18 0 50 81 3 P 1 00 1 161 49 1 071 53 SZ Hierl Local Right click on Product 1 to call up the Navigator s context menu Select Weights and then select _Weeks File Settings ee Project View Window Help 0090000020002 0vaA ACETAS Stat Forecast Unlocked a1 Ewuh 2011 2310 Hao E Product 1 Sales in thousands 2006 Jan an 2008 Jan 2010 Jan 2011 Jan 2012 Jan BE History E Fitted Values i Forecasts MMM Forecast Interval Z Hier 1 Local The second model s superior fit and narrower confidence limits are easily discernible from a visual inspection of the graph Notice that a seasonal model
273. ts of one time events that cause outliers The event that causes the outlier may be known or unknown Although exponential smoothing is a remarkably robust procedure these outliers may decrease the quality of the forecasts and especially the confidence limits Adjustment for Outliers 99 You can eliminate the effect of an outlier by coding it as a special event that occurs only once If you have several outliers each must be coded as a distinct event type Forecast Pro TRAC will explain each outlier as the result of its associated event The impact of outliers on the forecasts and the confidence limits will be greatly reduced Beware however if outliers continue to occur in the forecast period then the confidence limits are likely to be unrealistically narrow More Adjustments for Promotions The event adjustment model provides a very flexible framework to treat promotional effects of many kinds This section briefly notes some of them Its purpose is to indicate some directions you may want to take with your own business data The examples that are given require coding additional event types in your event variable Each new event type provides additional ability for Forecast Pro TRAC to explain your historic data by making the event variable more complex Keep in mind that if your event description is overly complex the out of sample performance of your model may deteriorate You must strike the right trade off between goodness o
274. ttent data model Very Simple Models Several of the menu options available under Model gt Very Simple Models invoke the dialog box below Very Simple Models a e san Simple Moving Average 3 gt Number of Terms Automatic Same as last year plus Fixed forecast value ETE Model gt Very Simple Models gt Simple Moving Average SMA n Use an n term simple moving average If the Automatic option is selected Forecast Pro TRAC will choose the number of terms to use and the forecast modifier will be displayed as SMA Model gt Very Simple Models gt Same as Last Year gt No Change SALY Set each forecasted value to equal the value for the same period last year either history or forecast as the case may be Model gt Very Simple Models gt Same as Last Year gt Plus Percent SALYP n Set each forecasted value to equal the value for the same period last year plus the specified percentage n Model gt Very Simple Models gt Same as Last Year gt Plus Increment SALY n Set each forecasted value to equal the value for the same period last year plus the specified increment 7 178 Using Forecast Modifiers Model gt Very Simple Models gt Same as Last Year gt Plus Delta Percent SALYDP Set each forecasted value to equal the value for the same period last year adjusted by the percentage change between the value for the same period last year and the same period two years ago Model gt Very Simple Models gt Same as Last Y
275. umeric Output icon 6 To save a Numeric Output file for the current Hot List you select Project gt Export gt Hot List Numeric Output or use the Save Numeric Output option on the Hot List s context menu Formatted Forecast Reports Formatted Forecast Reports can be saved to Excel You can save these reports for the currently displayed item all items on the Hot List or all items forecasted The Excel workbook will include a separate worksheet for each item These reports are convenient if you wish to present the forecasts and or models used to colleagues Each report contains the information found in the current Forecast Report view and optionally the graph found in the current graph view Numeric Output Files 163 You can specify the format and content of Formatted Forecast Report using Settings gt Forecast Report Design and Settings gt Graph Settings The operation of the Forecast Report Design and Graph Settings dialog boxes are described in the Command Reference section of this manual To save a Forecast Report file for all items forecasted you select Project gt Export gt Full Forecast Report or click the purple Save Formatted Forecast Report icon To save a Forecast Report file for the current Hot List you select Project gt Export gt Hot List Forecast Report or use the Save Forecast Reports option on the Hot List s context menu You can print a forecast report for the currently displayed item using File gt Print the
276. unwanted e g obsolete forecasts and overrides Important To reduce the size of the Forecast Pro TRAC database file you must use the Compact button after purging forecasts and overrides Purging without compacting results in the records being deleted from the database but does not change the file size 1 et O O O O O OOO OOO O Contents of Lesson 3 part 2 TRAC ACCESS 04 00 0000 Table TRAC_Stats 4 Purge Forecasts Prior to PPA Page Ovens Purge Al Forecast L 232 Command Reference The grid displays the contents of the database The Purge Forecasts button will delete all forecasts prior to the specified date The Purge Overrides button will delete all overrides prior to the specified date The Purge All button will delete all forecasts and overrides that are currently in the database The Drop All button will delete all the tables in the database and all information therein The Compact button consolidates the Forecast Pro TRAC database file Use this button to reduce the size of the database file after purging forecasts and or overrides The View Menu The View menu allows you to view reports display graphs and customize your display View gt All available views The first nine options on the View menu will toggle the selected view window on and off This can also be accomplished using the appropriate green or yellow icon View gt Toolbar View gt Toolbar displays and hides
277. ur project Exit Forecast Pro TRAC without saving changes to the Lesson 2 part 2 project This concludes Lesson 2 48 Working with Conversions and Alternative Hierarchies Lesson 3 Updating a Forecast Project For most organizations updating the forecast is a routine operation that occurs every planning period For instance if the forecasts are prepared using monthly data then each month the data are updated to include the latest observation and the forecasts are regenerated Forecast projects enable you to quickly update last period s forecast and give you the option of loading or not loading your previously specified forecasting models Hot List and forecast overrides In this lesson we will explore how this is accomplished Defining the Forecasting Process An important key to implementing a successful forecasting process using Forecast Pro TRAC is to define the process upfront and make sure that everyone involved understands their role in establishing the final numbers Some of the more important questions to answer before you start include What output is required and what format should it be in 49 What naming conventions should be used for data files output files and forecast projects where should these files be kept and how will they be backed up Who is authorized to enter forecast overrides at what level s are they entered and in what units are they entered What are the steps required to update our for
278. users innovators and imitators Innovators are early adopters of new products and are driven by their desire to try new technology Imitators are more wary of new technology they tend to adopt only after receiving feedback from others The Bass model uses two coefficients to quantify the adoption rates The Coefficient of Innovation referred to in the literature as p controls the rate for the innovators The Coefficient of Imitation referred to in the literature as 66 99 q controls the rate for the imitators If you have 5 or more historic data points these coefficients can be fit to the data To build a Bass model with fewer than 5 data points you must set the values for these coefficients along with the total number of potential adopters In this exercise we will look at two examples one where no data are available for the new product and the other where the initial 6 years of adoptions are known 114 New Product Forecasting Start the program click the red Script icon and select Home Electronic Product Accept the script read in the data forecast the data open the graph view and fully expand the Navigator Right click HE No data on the Navigator to invoke the context menu and then select Model gt Bass Diffusion In this example we have no historic data so we will need to specify the Coefficient of Innovation the Coefficient of Imitation and the Potential Market The coefficients could be set using values fr
279. utliers 1 e base the forecasts on the corrected values You can override this project level setting for individual items using the forecast modifiers listed below Forecast Pro TRAC only detects outliers for end items 1 e non group level data so the modifiers cannot be used for groups Outliers gt Default no modifier Revert back to the default project level setting for the specified item This option is used to remove any of the outlier modifiers listed below from the Navigator Outliers gt Off OUTLIER OFF Do not detect nor correct outliers for the specified item Outliers gt Detect OUTLIER DETECT Detect and report outliers for the specified item but do not correct for them 1 e base the forecasts on the uncorrected values 182 Using Forecast Modifiers Outliers gt Correct OUTLIER CORRECT Detect and correct outliers for the specified item 1 e base the forecasts on the corrected values Reconciliation Modifiers If no group level reconciliation modifiers have been specified a bottom up approach will be used to reconcile the forecasts The procedure operates as follows First Forecast Pro TRAC prepares forecasts for each and every group and item Then it recomputes the group level forecasts by aggregating the constituent forecast bottom up The original group level forecasts are replaced but their confidence limits are retained and proportionately adjusted Two group level modifiers can be used to
280. variable Variable descriptions must not exceed 256 characters in length Variable descriptions are displayed within Forecast Pro TRAC and can be included in Numeric Output Files and Forecast Report Files Starting year and period The year and period corresponding to the first available data point If the first available observation for a monthly series was April 2001 then the starting year would be 2001 and the starting period would 138 Setting Up Your Data be 4 The starting year must be 100 or later For data that are not calendar oriented enter 100 for the starting year and 1 for the starting period Periods per year 12 for monthly data 4 for quarterly data etc For data that is not calendar oriented use 1 Note that most weekly corporate calendars involve occasional years of 53 weeks these occurrences will cause the forecast date tags to be off by a week Periods per cycle The number of periods per seasonal cycle usually equal to the number of periods per year An exception might be daily data where periods per cycle could be set to 7 to capture weekly patterns and periods per year set to 365 Or if weekend days are excluded periods per cycle might be 5 and periods per year 260 For nonseasonal data periods per cycle should be 1 This is a critical entry because Forecast Pro TRAC uses it for seasonal adjustments Selecting a Data Format The program accepts three different data formats Text MLT Spreadsheet XLS XL
281. verview 137 Truncate directs Forecast Pro TRAC to use only the most recent unbroken stream of data All data up to and including the last missing value are discarded Impute directs Forecast Pro TRAC to discard leading and trailing missing values but to impute embedded missing values via linear interpolation Zero directs Forecast Pro TRAC to reset missing values to zeroes and to treat them as numerical values This setting is appropriate when the data file is written from a database in which only the non zero records are stored In other cases it might lead to badly biased forecasts Header information You will need to collect not only the time series data but also certain header information The header information includes the following Variable name The name by which the program refers to an individual item often an SKU An item name is limited to 256 of the following characters 0 9 A Za z amp _ lt gt However you may also be limited by restrictions imposed by the software to which you export your data SQL databases for instance sometimes require that the first character in a name is a letter and do not regard upper and lower cases as distinct If the variable name begins or ends with an underbar _ Forecast Pro TRAC tags it as a potential helper variable and will not forecast it Helper variables are used for event modeling and weighting transformations Variable description A short description of the
282. w Statistical Formula Override Comment Last Updated ar se Stuff Mart COR 12 11 2011 Aug Demand Piannin 3 8 459 10 459 10 459 increased forecast to accomodate a planned promotion 5 5 2011 10 1 BRA 12 11 2011 Sep Demand Plannin 3 16 457 18 457 18 457 increased forecast to accomodate a planned promotion 5 5 2011 10 1 BLU 12 11 2011 Oct Demand Piannin 3 19 715 21 715 21 718 increased forecast to accomodate a planned promotion 5 5 2011 10 1 APP 12 11 E APP 12 11 2011 Aug Demand Plannin 3 5 1624 7 624 7 624 forecast adjusted per customer s request 5 5 2011 10 1 OAT 12 11 2011 Sep Demand Pianning 3 7 476 9 476 9 476 forecast adjusted per customer s request 5 5 2011 10 12 Sids Club 2011 Oct Demand Planning 3 7 314 9 314 9 314 forecast adjusted per customer s request 5 5 2011 10 12 COR 12 11 Sids Club BRA 12 11 2011 Aug Demand Pianning 3 7 512 9 512 9 512 increased forecast to accomodate a planned promotion 5 5 2011 10 12 gt BRA 12 11 2011 Sep Demand Planning 3 7 641 9 641 9 641 Increased forecast to accomodate a planned promotion 5 5 2011 10 17 ss rors 2011 Oct Demand Planning 3 7 677 9 677 9 677 increased forecast to accomodate a planned promotion 5 5 2011 10 12 Grocery Land COR 12 11 BLU 12 11 APP 12 11 3 Food King COR 12 11 F Lesson 2 part 2 Forecast overrides o lez BLU 12 11 i lt 5 Jj ji ji COR 12 11 s Aw sep oct nov Sar Statistical 6545 8459 16457 19715 18 318 36746 23072 11234
283. w all items on the Navigator on the report rather than only the ones that exceed the thresholds to include columns for the Pareto output and to include columns for custom filters if there are any defined Select the Forecast Range tab and click Apply This report compares the forecast to defined upper and lower bounds and flags any forecasts that fall outside of the defined range Notice that we are currently using Item level thresholds this is very common with the Forecast Range report Select the Fitted Error tab and click Apply This report will flag as an exception any forecast model where the within sample MAPE or MAD exceeds the current threshold Select the Forecasts vs Archive tab and click Apply This report compares the current forecast to an archived forecast for the same period and flags any cases where the change exceeds the thresholds Our current example is monitoring the current July and August forecasts Forecast periods to consider is set to 1 through 2 against the forecasts we generated for July and August in the prior forecasting period Archive period is set to one Monitoring Archived Forecasts The final two exception reports monitor your archived forecasts rather than your current period s forecast Select the Archive vs Actual tab and click Apply This report compares an archived forecast 1 e a forecast you prepared in the past to what actually happened The Periods to monitor s
284. wed on screen and saved to Excel This report lists items where overrides and or comments have been made The Exception Report can be viewed on screen and saved to Excel This report lists all items that have been flagged as exceptions using the currently defined exception logic settings The Outlier Report can be viewed on screen and saved to Excel This reports lists items where outliers have been detected and or corrected The following sections discuss these output files in more detail Forecast Projects Forecast Projects allow you to save your forecasting session so that you can return later and pick up where you left off or to share the session with others The forecast project saves the data forecasts overrides Hot List modifiers etc as they currently exist in memory If you update your input data files after saving a project when you reopen the project you ll have the option of either generating new forecasts using the updated data or restoring the conditions present when the project was saved 1 e not recalculating the forecasts using the new data 160 Saving Your Work Opening Projects To save a forecast project you select File gt Save or click the blue Save Project icon To open a forecast project you select File gt Open or click the blue Open Project icon 6 If you open a project and data files have not changed 1 e the time and date stamps match the project will restore the conditions present when the
285. will remain consistent regardless of the hierarchy or units you are viewing Forecast Pro TRAC will move the in place overrides into a special override row labeled Inherited overrides prior to performing hierarchy changes and or conversions Select the Units drop down box on the dialog bar and select Dollars 46 Working with Conversions and Alternative Hierarchies A warning message informs you that this action will lock the statistical forecasts move all current overrides into the inherited override row and discard all current comments Click OK to continue Notice that the in place overrides have disappeared the Override Report is now empty and that there is now a display row labeled Inherited overrides that contains the changes Right click on the Override Report to invoke its context menu and select Override Report Design Tabular Formatted Display In place only Include Pareto statistics Select filter attributes to display Current origin amp current project Last origin amp current origin Custom Set as Default Notice that the Override Report is currently set to display in place overrides only Since there are no current in place overrides the display is empty Select Current origin amp current project and click OK This will display all overrides associated with the current project during the current forecast period RAC Lesson 2 part 2 File Settings Operations Project View Window Help
286. y are present will be used to generate the forecasts in command line mode If this option is not selected all forecast modifiers in the project will be ignored when running from the command line Overrides If this option is selected the command line run will begin by reading in the data generating the statistical forecasts and then it will apply any matching overrides comments in the project to the new forecasts If this option is not selected all overrides in the project will be ignored when running from the command line Settings If this option is selected the command line run will use all of the settings associated with the project e g all settings in the Settings dialog box numeric output formatting etc If this option is not selected the default settings 1 e the settings that have been saved as the defaults for use with new projects will be used when running from the command line Project settings are saved in the project file FPProj Default settings are stored in the ForecastProTRAC ini file The remaining options specify the output files to generate when the project is run from the command line Numeric output If this option is selected the command line run will save the numeric output You have the option of saving this file for all items forecasted or if you select Hot List only just for the items listed on the Hot List Forecast Report If this option is selected the command line run will save a formatted
287. y the weighting variable you may want to restrict the model selection to nonseasonal models perhaps using a custom exponential smoothing model Product phase outs and other forecast adjustments There may be times where you wish to alter the statistical forecasts using a weighting variable rather than the forecast adjustment facility For example let s say that you plan on discontinuing a product and wish to use the statistical forecast until the product is discontinued You could create a weighting variable that consists of all ones during the history and the forecast periods prior to the discontinuation date and equals zero for all periods thereafter If the product would be phased out over a three month period rather than ending abruptly then you could use weights like 75 5 25 during the phase out period This concludes Lesson 13 120 Using Weighting Transformations Lesson 14 Detecting and Correcting Outliers An outlier is a data point that falls outside of the expected range of the data 1 e it is an unusually large or small data point If you are forecasting a time series that contains an outlier there is a danger that the outlier could have a significant impact on the forecast One solution to this problem is to screen the historical data for outliers and replace them with more typical values prior to generating the forecasts This process is referred to as outlier detection and correction Correcting for a severe out
288. ype the filenames on the script one to a line or you can double click the filename displayed in the list box to insert the filename onto the script If you are in ODBC mode the tables and queries in your database replace filenames Double click the filename 23 Bakery to insert it on the first line of the script When you list a data file on a line of the script the program will forecast every series in the data file with the exception of helper variables whose names Defining the Script 23 must begin or end with an underbar Thus our first line instructs the program to forecast all series found in 23 Bakery xls r Define Script 123 Bakery Your script should look like the one above Accept the script and return to the main menu by clicking the OK button Reading in the Data You may have noticed that the red Read Data icon which had been grayed out is now activated Click this icon to read the data into memory When you read data any existing data in memory is replaced Click the green View Graph icon to open the graph view and display a graph for 123 Bakery Double click Total on the Navigator to expand the Navigator s tree You ll see that the total sales breakdown into Muffins and Cakes Select Total gt Muffins on the Navigator to display its graph If you expand Total gt Muffins on the Navigator you Il discover a customer level breakdown and finally an SKU level Experiment with the N

Forecast Pro TRAC V2 User`s Guide

Contents

Download Pdf Manuals

Related Search

Related Contents