Creating and maintaining forecasts lets a company plan production activities sufficiently. A forecasted quantity represents estimated demand for an item (typically based on criteria such as historical demand or seasonal requirements. By scheduling production activities according to a forecast, users are not dependent on the entry of sales orders to drive production.
The Quick Planner Worksheet uses several different factors to determine demand requirements for an item, including forecast quantities. You can set a days view that instructs the system how far into the future to look when determining item demand. Anywhere Mobility Solutions forecast quantities or transactions requiring an item that are scheduled to occur within the defined days view are summed together to calculate the item's total demand. The Quick Planner then compares this to supply data from within the same days view to determine whether production activity is necessary.
Although a forecasted quantity is helpful when planning production activity further into the future, its usefulness decreases as the forecast date approaches the actual date. For example, if the production planner is looking at anticipated production requirements over the next four weeks, a forecast quantity with a date two weeks away may be useful. Thirteen days later, that same forecast quantity now exists for the following day. At this point, the production planner probably does not want to include this forecast quantity when determining demand.
To discount the impact of entered production forecasts when they are too close to the current date to be of value, you can establish a forecast time fence.
Defining the forecast time fence
Define the forecast time fence on the Process Setup page. Enter it as a time interval (for example, 1W. The program calculates a forecast time fence date by applying this interval to the work date. For example, if you define a forecast time fence interval of four days, on 07/15/06 the program calculates a forecast time fence date of 07/19/06.
The various supply and demand quantities on the Quick Planner are determined by the days view. If the forecast time fence interval exceeds the days view, the Quick Planner does not include Anywhere Mobility Solutions forecast quantities in its demand calculations. If you want to factor production forecasts into production planning, make sure the forecast time fence interval is not greater than the days view intervals you typically use with the Quick Planner.
Demand calculations
When demand is calculated for an item on the Quick Planner, different criteria apply for the periods before and after the forecast time fence. Forecast quantities on dates that fall before the time fence are ignored by the system. Only demand requirements from transactions such as sales orders are factored into an item's demand.
Beginning with the forecast time fence date, the program takes forecast quantities into consideration. An item's forecast quantity is compared to the post-time-fence sales order quantity, and the greater value is added to the pre-time-fence demand quantity to determine the item's total demand.
For example, between the work date and the forecast time fence date, an item has a production forecast quantity of five units and a sales order quantity of 10 units. Between the forecast time fence date and the defined days view, the item has a production forecast quantity of 10 units and a sales order quantity of 15 units. In the first period, the forecast quantity is discounted, so item demand is based solely on the entered sales order quantity of 10 units. In the second period, the forecast and sales order quantities are compared and the larger of the two) in this case the sales order quantity of 15 units) is added to the amount from the first period. In this scenario, item demand is calculated as 25 units.
If the days view is adjusted so that new demand requirements are included or excluded, this may change the values used to calculate demand. If the days view is adjusted to include a few more days so that the item's post-time-fence forecast and sales order quantities become 30 and 20 units respectively, it is now the forecast quantity that is added to the pre-time-fence demand, resulting in a total demand of 40 units.