Question: What are the different sales filter methods used by DRP?
Answer: This is the current list. New standard (and custom) sales filter methods may be developed to handle the needs of specific situations.
Note The parameter names must be entered exactly as listed in order for the calculations to work properly. These same parameter names can be used for different sales filter methods.
|
Sales Filter Method / Program Name |
Parameter |
Type |
Default Value |
Description |
|
Mean Avg Deviation |
The Mean Average Deviation sales filter method calculates whether to automatically reduce sales demand based upon the number of mean average deviations. Note This method is typically used for a short lead time product that is being managed on a reorder trigger basis. Currently, this method is only valid when used in conjunction with the ExpSmooth (methfcexph.p) forecast method. For more information on that forecast method, see DRP - Forecast Method FAQ. |
|||
|
|
# of MAD’s |
Decimal |
4 |
The number of MAD’s that will trigger the use of a sales filter. |
|
|
Exclude # of periods |
Integer |
5 |
Don’t calculate the MAD unless there is more than this number of periods. |
|
Example Assuming an alpha level of .3, the April MAD is calculated as follows for the values in the table below: MAD = [Prior Month MAD x (1 - Alpha Level)] + [absolute value of Current Month Forecast Error x Alpha Level] MAD = [56.02 x .7] + [23 x .3] MAD = 39.21 + 6.9 MAD = 46.11 So, when evaluating the next month’s sales (May), and whether to use the sales filter, then 4 x 46.11 (184.44) plus the April average of 148.9 = 333. If May’s sales had exceeded 333, then the sales used for calculations would have been reduced to 333.
|