Why moving averages in APO DP rarely move?
September 7th, 2011 by Dr. Chockalingam
When I was a beginning student of Statistics in High School, I was fascinated by moving averages. This is pretty cool stuff to get an average that moves over time rather than the plain vanilla “sum it up and divide by the count” routines.
The question that we hear often from SAP APO users is about the “mysterious” behavior of the moving average model. Many pronounce SAP APO Demand Planning module as weak the moment they see a constant straight line as the forecast after “trying very hard” with countless hours of model iterations!!
To some, APO DP often declares the constant as the “best” forecast. And of course, the planners are frustrated. Management is frustrated to see a constant forecast coming from a million-dollar package most of the time.
There are many factors that may be driving this frustrating challenge- Continue reading
| 
