Closed Loop Forecasting

Outcome

Closed loop forecasting results in a daily gross forecast.

The forecast is used as a manually entered forecast within material planning in M3 BE.

During this process, the data set file is updated when data is exported back to M3 BE from DMP. The user can decide whether to export all data or new and/or changed data only. If the dataset is transferred to item forecasts in the forecasting (FOR) component group, the forecasting file (MITAFO) is updated.

Before you start

• The company must have a policy for how and when to perform collaborative demand planning using DMP.
• The necessary enabling processes must have been performed. (Refer to the respective enabling processes for further information.)

Purpose

The purpose of using this concept is to refine the forecasting by making it possible to forecast close to the end customers and still maintain control over the extended supply chain. Several forecasting participants at different places can work simultaneously with their respective forecast areas.

When

The frequency of performing closed loop forecasting depends on the company’s time fences and forecasting cycles. For example, a fashion company might perform it once per month, while a food company performs it every week.

How

The data that is used in forecasting is accumulated in data set, which are storage sites for budgets and statistical information in M3 BE. This data is then imported into M3 Demand Planner. An administrator creates DMP data set and forecast packages and distributes these to forecasters that are located near or have further knowledge of the company’s different markets. The forecasters review and, if necessary, change the values or create new ones. The administrator then consolidates these values into an updated sales budget. This budget is exported back to M3 BE, where it can be transferred to item forecasts in the forecasting component group or the master demand schedule and then transferred to the material plan.

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