Tag Archives: forecast

A Check on Forecast Automation with the Attention Index

The text of a poem by Alec CairncrossA new metric we call the “Attention Index” will help forecasters identify situations where “data behaving badly” can distort automatic statistical forecasts (see adjacent poem). It quickly identifies those items most likely to require forecast overrides—providing a more efficient way to put business experience and other human intelligence to work maximizing the accuracy of forecasts. How does it work?
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Estimating Safety Stock

In my previous post in this series on essential concepts, “What is ‘A Good Forecast’”, I discussed the basic effort to discover the most likely future in a demand planning scenario. I defined a good forecast as one that is unbiased and as accurate as possible. But I also cautioned that, depending on the stability or volatility of the data we have to work with, there may still be some inaccuracy in even a good forecast. The key is to have an understanding of how much.

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