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16 Cards in this Set
- Front
- Back
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Causal relationship forecasting
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Forecasting using independent variables other than time to predict future demand.
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Collaborative Planning, Forecasting, and Replenishment (CPFR)
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An Internet tool to coordinate forecasting, production, and purchasing in a firm’s supply chain.
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Decomposition
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The process of identifying and separating time series data into fundamental components such as trend and seasonality.
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Exponential smoothing
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A time series forecasting technique using weights that decrease exponentially (1 – α) for each past period.
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Forecast error
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The difference between actual demand and what was forecast.
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Linear regression forecasting
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A forecasting technique that fits a straight line to past demand data.
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Mean absolute deviation (MAD)
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The average of the absolute value of the actual forecast error.
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Mean absolute percent error (MAPE)
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The average error measured as a percentage of average demand.
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Moving Average
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A forecast based on average past demand.
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Smoothing constant alpha (α)
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The parameter in the exponential smoothing equation that controls the speed of reaction to differences between forecasts and actual demand.
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Smoothing constant delta (δ)
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An additional parameter used in an exponential smoothing equation that includes an adjustment for trend.
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Strategic forecasts
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Medium and long-term forecasts that are used for decisions related to strategy and aggregate demand.
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Tactical forecasts
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Short-term forecasts used for making day-to-day decisions related to meeting demand.
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Time series analysis
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A forecast in which past demand data is used to predict future demand.
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Tracking signal
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A measure of whether the forecast is keeping pace with any genuine upward or downward changes in demand. This is used to detect forecast bias.
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Weighted moving average
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A forecast made with past data where more recent data is given more significance than older data.
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