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 Example 1 for the Preparation Service for the LI-Based Forecast

 

  • You have assigned the following BOD to product X:

    The entry location Chicago has the following child locations:

    • Stockholding location New York

    • Stockholding location Antwerp

    • Stockholding location Rome

    • Stockholding virtual child location(vCL) Chicago

      The Antwerp location has the non-stockholding location Berlin as a direct child location.

  • In the entry location Chicago you have assigned a leading indicator group, which contains the leading indicators Installed Base and Number of Uses.

  • You have assigned the Installed Base leading indicator to product X.

  • Product X is not part of a supersession.

  • In period 06.2005, the entry location Chicago had an aggregated demand of 9 items of product X.

  • In the service profile for the distribution service for the leading-indicator-based forecast you have set the Read BOM of LI flag.

  • In period 06.2005 you have the following equipment on the market:

    • Equipment A

      The demand for equipment A occurred in the New York location. This equipment has been assigned an equipment BOM with the following items:

      • 4 of product X

      • 4 ofproduct Y

      • 1 of product Z

    • Equipment B

      The demand for equipment B occurred in the Berlin location. This equipment corresponds to product X.

    • Equipment C

      The demand for equipment C occurred in the Rome location. This equipment has been assigned an equipment BOM with the following items:

      • 10 of product X

      • 8 of product Y

    • Equipment D

      The demand for equipment D occurred in the virtual child location Chicago . This equipment has been assigned an equipment BOM with the following items:

      • 7 of product X

      • 4 of product Z

  • You have not defined any selection criteria for your equipment.

Demand History for Leading IndicatorInstalled Basefor ProductX

For product X, the preparation service proceeds to determine the demand history of the assigned leading indicator Installed Base as follows:

  1. The preparation service reads the available equipment BOMs and counts how often product X occurs in each of these:

    • Equipment A : 4 times

    • Equipment C: 10 times

    • Equipment D: 7 times

      The preparation service checks whether there is equipment corresponding to product X and determines equipment B.

    • Equipment B: 1 time

  2. The preparation service determines the first stockholding locations for product X and the history of the leading indicator for the resulting location products as follows:

    • The demand for equipment A occurred in the New York location. This location is stockholding. Hence, a location product of product X is location product NewYork_X . The demand history of the leading indicator Installed Base for location product NewYork_X is 4.

    • The demand for equipment B occurred in the Berlin location. This location is not stockholding. The direct parent location of the Berlin location is the Antwerp location. This location is stockholding. Hence, a location product of product X is location product Antwerp_X . The demand history of the leading indicator Installed Base for location product Antwerp_X is 1.

    • The demand for equipment C occurred in the Rome location. This location is stockholding. Hence, a location product of product X is location product Rome_X . The demand history of the leading indicator Installed Base for location product Rome_X is 10.

    • The demand for equipment D occurred in the virtual child location Chicago . This virtual child location is stockholding. Hence, a location product of product X is location product vCLChicago_X . The demand history of the leading indicator Installed Base for location product vCLChicago_X is 7.

  3. The preparation service aggregates the values of the demand history for the leading indicator Installed Base along the BOD for product X as follows and thus gets the demand history for the leading indicator Installed Base at entry location level:

    LI value NewYork_X + LI value Antwerp_X + LI value Rome_X + LI value vCLChicago_X =4 + 1 + 10 + 7 = 22

  4. The preparation service determines the historical value of the coefficient for period 06.2005 as follows:

    Final demand for spare part X in per. 06.2005 / value of dem. hist. of LI in per. 06.2005 = 9 / 22 = 0.409