Overview of KPIs for the Forecast Accuracy application

Forecast Error (MAPE)

Volume weighted Forecast Error (volume weighted MAPE)

Forecast Accuracy (based on MAPE)

Volume weighted Forecast Accuracy (based on Vol. Weighted MAPE)

Forecast Bias (MPE)

Actual Sales
 Forecast Error (MAPE = Mean Absolute Percentage
Error)

Time (t), n=12 - PROD1 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1270 2340 2310 2340 2348 1890 2100 2231 2401 2310 2340 2560
Actual (History) 1130 2410 2210 2500 2432 1980 2045 2340 2460 2350 2345 2650

Error = Forecast - Actual 140 -70 100 -160 -84 -90 55 -109 -59 -40 -5 -90
Absolute Error = abs (Actual - Forecast) 140 70 100 160 84 90 55 109 59 40 5 90
Absolute Percentage Error = Absolute Error / Actual 12,39% 2,90% 4,52% 6,40% 3,45% 4,55% 2,69% 4,66% 2,40% 1,70% 0,21% 3,40%

Forecast Error: MAPE = average ( Absolute Percentage Error ) 4,11%

Time (t), n=12 - PROD2 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 135 240 235 235 250 188,7 245 245 250 235 245 256
Actual (History) 113 241 221 250 243 198 204 234 246 235 234 265

Error = Forecast - Actual 22 -1 14 -15 7 -9,3 41 11 4 0 11 -9

Absolute Error = abs (Actual - Forecast) 22 1 14 15 7 9,3 41 11 4 0 11 9
Absolute Percentage Error = Absolute Error / Actual 19,47% 0,41% 6,33% 6,00% 2,88% 4,70% 20,10% 4,70% 1,63% 0,00% 4,70% 3,40%

Forecast Error: MAPE = average ( Absolute Percentage Error ) 6,19%

Time (t), n=12 - TOTAL (PROD1 + PROD2) 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1405 2580 2545 2575 2598 2078,7 2345 2476 2651 2545 2585 2816
Actual (History) 1243 2651 2431 2750 2675 2178 2249 2574 2706 2585 2579 2915

Error = Forecast - Actual 162 -71 114 -175 -77 -99,3 96 -98 -55 -40 6 -99
Absolute Error = abs (Actual - Forecast) 162 71 114 175 77 99,3 96 98 55 40 6 99
Absolute Percentage Error = Absolute Error / Actual 13,03% 2,68% 4,69% 6,36% 2,88% 4,56% 4,27% 3,81% 2,03% 1,55% 0,23% 3,40%

Forecast Error: MAPE = average ( Absolute Percentage Error ) 4,12%

Interpretation
Higher values mean less accurate forecasting
Divison by zero problem if there is no actual. The practical solution is to set the error percent to a high number such as 999%. Note the error is not Zero in this case!!
The planners should spend less time worrying about how large the error is when the error exceeds a certain threshold say 70-80%.
Mathematically it matters whether the error is 85% or 500%, but from a supply chain perspective a 85% forecast error is already disastrous!
 Volume Weighted Forecast Error (Volume Weighted MAPE)

Time (t), n=12 - PROD1 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1270 2340 2310 2340 2348 1890 2100 2231 2401 2310 2340 2560
History 1130 2410 2210 2500 2432 1980 2045 2340 2460 2350 2345 2650

Error = Forecast - Actual 140 -70 100 -160 -84 -90 55 -109 -59 -40 -5 -90
Absolute Error = abs (Actual - Forecast) 140 70 100 160 84 90 55 109 59 40 5 90

Vol. weighted Forecast Error (vol. weighted MAPE) = SumOf(Absolute Errors) / SumOf(Actuals) 3,73%

Time (t), n=12 - PROD2 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 135 240 235 235 250 188,7 245 245 250 235 245 256
History 113 241 221 250 243 198 204 234 246 235 234 265

Error = Forecast - Actual 22 -1 14 -15 7 -9,3 41 11 4 0 11 -9

Absolute Error = abs (Actual - Forecast) 22 1 14 15 7 9,3 41 11 4 0 11 9

Vol. weighted Forecast Error (vol. weighted MAPE) = SumOf(Absolute Errors) / SumOf(Actuals) 5,38%

Time (t), n=12 - TOTAL (PROD1 + PROD2) 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1405 2580 2545 2575 2598 2078,7 2345 2476 2651 2545 2585 2816
History 1243 2651 2431 2750 2675 2178 2249 2574 2706 2585 2579 2915

Error = Forecast - Actual 162 -71 114 -175 -77 -99,3 96 -98 -55 -40 6 -99
Absolute Error = abs (Actual - Forecast) 162 71 114 175 77 99,3 96 98 55 40 6 99

Vol. weighted Forecast Error (vol. weighted MAPE) = SumOf(Absolute Errors) / SumOf(Actuals) 3,70%

Interpretation
Higher values mean less accurate forecasting
Divison by zero problem if there is no actual (but ONLY if there is no data in all periods!). The practical solution is to set the error percent to a high number such as 999%. Note the error is not Zero in this case!!
The planners should spend less time worrying about how large the error is when the error exceeds a certain threshold say 70-80%.
Mathematically it matters whether the error is 85% or 500%, but from a supply chain perspective a 85% forecast error is already disastrous!
Volume weighted MAPE is also called MAD/mean ratio
 Forecast Accuracy

Time (t), n=12 - PROD1 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1270 2340 2310 2340 2348 1890 2100 2231 2401 2310 2340 2560
History 1130 2410 2210 2500 2432 1980 2045 2340 2460 2350 2345 2650

Error = Forecast - Actual 140 -70 100 -160 -84 -90 55 -109 -59 -40 -5 -90
Absolute Error = Abs (Actual - Forecast) 140 70 100 160 84 90 55 109 59 40 5 90
Absolute Percentage Error 12,39% 2,90% 4,52% 6,40% 3,45% 4,55% 2,69% 4,66% 2,40% 1,70% 0,21% 3,40%

Forecast Error: MAPE 4,11%

Forecast Accuracy = 100%- Forecast Error 95,89%

Time (t), n=12 - PROD2 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 135 240 235 235 250 188,7 245 245 250 235 245 256
History 113 241 221 250 243 198 204 234 246 235 234 265

Error = Forecast - Actual 22 -1 14 -15 7 -9,3 41 11 4 0 11 -9

Absolute Error = Abs (Actual - Forecast) 22 1 14 15 7 9,3 41 11 4 0 11 9
Absolute Percentage Error 19,47% 0,41% 6,33% 6,00% 2,88% 4,70% 20,10% 4,70% 1,63% 0,00% 4,70% 3,40%

Forecast Error: MAPE 6,19%

Forecast Accuracy = 100%- Forecast Error 93,81%

Time (t), n=12 - TOTAL (PROD1 + PROD2) 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1405 2580 2545 2575 2598 2078,7 2345 2476 2651 2545 2585 2816
History 1243 2651 2431 2750 2675 2178 2249 2574 2706 2585 2579 2915

Error = Forecast - Actual 162 -71 114 -175 -77 -99,3 96 -98 -55 -40 6 -99
Absolute Error = Abs (Actual - Forecast) 162 71 114 175 77 99,3 96 98 55 40 6 99
Absolute Percentage Error 13,03% 2,68% 4,69% 6,36% 2,88% 4,56% 4,27% 3,81% 2,03% 1,55% 0,23% 3,40%

Forecast Error: MAPE 4,12%

Forecast Accuracy = 100%- Forecast Error 95,88%

Interpretation
Higher values mean more accurate forecasting
Lowest value 0%, even for cases when Forecast Error is more than 100%.
Highest value 100%, means actuals were equal to forecasted quantities
 Volume Weighted Forecast Accuracy

Time (t), n=12 - PROD1 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1270 2340 2310 2340 2348 1890 2100 2231 2401 2310 2340 2560
History 1130 2410 2210 2500 2432 1980 2045 2340 2460 2350 2345 2650

Error = Forecast - Actual 140 -70 100 -160 -84 -90 55 -109 -59 -40 -5 -90
Absolute Error = abs (Actual - Forecast) 140 70 100 160 84 90 55 109 59 40 5 90

Vol. weighted Forecast Error (vol. weighted MAPE) = SumOf(Absolute Errors) / SumOf(Actuals) 3,73%
Volume weighted Forecast Accuracy = 100% - Vol. Weighted Forecast Error 96,27%

Time (t), n=12 - PROD2 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 135 240 235 235 250 188,7 245 245 250 235 245 256
History 113 241 221 250 243 198 204 234 246 235 234 265

Error = Forecast - Actual 22 -1 14 -15 7 -9,3 41 11 4 0 11 -9

Absolute Error = abs (Actual - Forecast) 22 1 14 15 7 9,3 41 11 4 0 11 9

Vol. weighted Forecast Error (vol. weighted MAPE) = SumOf(Absolute Errors) / SumOf(Actuals) 5,38%
Volume weighted Forecast Accuracy = 100% - Vol. Weighted Forecast Error 94,62%

Time (t), n=12 - TOTAL (PROD1 + PROD2) 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1405 2580 2545 2575 2598 2078,7 2345 2476 2651 2545 2585 2816
History 1243 2651 2431 2750 2675 2178 2249 2574 2706 2585 2579 2915

Error = Forecast - Actual 162 -71 114 -175 -77 -99,3 96 -98 -55 -40 6 -99
Absolute Error = abs (Actual - Forecast) 162 71 114 175 77 99,3 96 98 55 40 6 99

Vol. weighted Forecast Error (vol. weighted MAPE) = SumOf(Absolute Errors) / SumOf(Actuals) 3,70%
Volume weighted Forecast Accuracy = 100% - Vol. Weighted Forecast Error 96,30%

Interpretation
Higher values mean more accurate forecasting
Lowest value 0%, even for cases when Forecast Error is more than 100%.
Highest value 100%, means actuals were equal to forecasted quantities
 Forecast Bias (MPE = Mean Percentage Error)

Time (t), n=12 - PROD1 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1270 2340 2310 2340 2348 1890 2100 2231 2401 2310 2340 2560
History 1130 2410 2210 2500 2432 1980 2045 2340 2460 2350 2345 2650

Error = Forecast - Actual 140 -70 100 -160 -84 -90 55 -109 -59 -40 -5 -90
Percentage Error = Error / Actual 12,39% -2,90% 4,52% -6,40% -3,45% -4,55% 2,69% -4,66% -2,40% -1,70% -0,21% -3,40%

Forecast Bias = Average (Percentage Error) -0,84%

Time (t), n=12 - PROD2 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 135 240 235 235 250 188,7 245 245 250 235 245 256
History 113 241 221 250 243 198 204 234 246 235 234 265

Error = Forecast - Actual 22 -1 14 -15 7 -9,3 41 11 4 0 11 -9

Percentage Error = Error / Actual 19,47% -0,41% 6,33% -6,00% 2,88% -4,70% 20,10% 4,70% 1,63% 0,00% 4,70% -3,40%

Forecast Bias = Average (Percentage Error) 3,78%

Time (t), n=12 - TOTAL (PROD1 + PROD2) 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1405 2580 2545 2575 2598 2078,7 2345 2476 2651 2545 2585 2816
History 1243 2651 2431 2750 2675 2178 2249 2574 2706 2585 2579 2915

Error = Forecast - Actual 162 -71 114 -175 -77 -99,3 96 -98 -55 -40 6 -99
Percentage Error = Error / Actual 13,03% -2,68% 4,69% -6,36% -2,88% -4,56% 4,27% -3,81% -2,03% -1,55% 0,23% -3,40%

Forecast Bias = Average (Percentage Error) -0,42%

Interpretation
Higher values mean less accurate forecasting
Divison by zero problem if there is no actual. The practical solution is to set the error percent to a high number such as 999%. Note the error is not Zero in this case!!
The sign is important. Positive values mean that the actuals were overforecasted, negative values mean that it was underforecasted.
 Actual Sales

Time (t), n=12 - PROD1 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 1270 2340 2310 2340 2348 1890 2100 2231 2401 2310 2340 2560
History 1130 2410 2210 2500 2432 1980 2045 2340 2460 2350 2345 2650

ActualSales = SumOf(
History ) 26852

Time (t), n=12 - PROD2 1 2 3 4 5 6 7 8 9 10 11 12

Forecast 135 240 235 235 250 188,7 245 245 250 235 245 256
History 113 241 221 250 243 198 204 234 246 235 234 265

ActualSales = SumOf(
History ) 2684

Time (t), n=12 - TOTAL

(PROD1 + PROD2) 1 2 3 4 5 6 7 8 9 10 11 12
Forecast 1405 2580 2545 2575 2598 2078,7 2345 2476 2651 2545 2585 2816
History 1243 2651 2431 2750 2675 2178 2249 2574 2706 2585 2579 2915

ActualSales = SumOf(
History ) 29536