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Demand Forecasting woes

  • 1.  Demand Forecasting woes

    Posted 6 days ago

    We are currently running AX 2012 R3 CU8 and are experiencing some very strange behavior in demand forecasting.

    1. Demand Forecast outliers
      1. We have several items that have an average monthly usage of say, 1,000 per month. The demand forecast will give us several months of roughly 1,000 per month and then we get a demand of 15,000 or even 0.  We've even had an item that averages 400 a month throw a forecast of 370,000 in a single month!  See the attached screenshot.
      2. We use ARIMA as the forecast method and are using {12, 6, 4, 3, 1} as the "Periodicity in the data" setting.
      3. We generate the baseline forecast with a 13-month historical horizon. If running the forecast for 12/1/2019 we use a historical time fence of 11/1/2018 through 11/30/2019.
    Demand Forecast
    1. Forecast Date Range
      1. Our forecast also seems to be off by 1 month. The demand forecast dated 3/1/2020 is actually the demand we needed for Feb 2020.  Shouldn't the demand forecast be dated 2/1/2020 for demand needed in Feb 2020?  Basically, if we have demand for a particular month, we would like the forecast to tell us to have the inventory to cover that demand by the first of that month.

    I'm also interested in hearing from any organization out there that is currently using AX 2012 R3 CU8's ARIMA forecasting to get feedback on their forecasting, if they are seeing these types of issues and what they do about them.



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    Ken Hershberger
    Director - IT Systems
    The Penrod Company
    Virginia Beach VA
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    Conference-AXUG_200x200


  • 2.  RE: Demand Forecasting woes

    SILVER CONTRIBUTOR
    Posted 5 days ago
    Without seeing more data it is difficult to see where your problem exists. I would start at the item coverage group and review the settings as that will have a large part in how the forecast loads the demand. We load our forecast for the end of the month so that any transactions during the month can be applied and then reduce the total forecast.

    If you make any changes make sure Forecast plans and Master plans are regenerated.

    Next I would review your net requirements to see where that forecast is being pulled from.

    Start there and if you need to feel free to reach out.
    #AX2012
    #Admin
    ​​

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    Ted Jillett
    Business Systems Analyst, Manufacturing AX
    Insulet Corporation
    Acton MA
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    Conference-AXUG_200x200


  • 3.  RE: Demand Forecasting woes

    Posted 5 days ago
    Thanks for the response, Ted!

    The forecast seems to be reasonable for most of our items.  We just continue to have these outliers.

    We've had the entire forecast setup reviewed by Functional Consultants at least twice in the past 2 years.  We just can't seem to find out why these outliers occur and we don't have the resources to manually review and update the entire forecast every month.

    We're almost to the point of abandoning the built-in forecasting and just creating a tool to generate our own forecast and import it.

    Let me know what else you'd like to see.

    ------------------------------
    Ken Hershberger
    Director - IT Systems
    The Penrod Company
    Virginia Beach VA
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    Conference-AXUG_200x200


  • 4.  RE: Demand Forecasting woes

    Posted 5 days ago
    I recommend the Farsight Demand Forecasting certified add-on for AX and D365

    It does exactly what you want but much better than standard AX/D365

    It is simple to use, well-designed, shows both numbers and visuals and is reasonably priced & easy to install

    http://farsight.co.nz/DemandForecasting.aspx

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    Ian Deynzer
    CFO
    Jacobsen Creative Surfaces
    Auckland
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    Conference-AXUG_200x200


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