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  Example: Calculation Based on the Arithmetic Mean Average

In this example, the average-demand horizon comprises seven planning periods and the averaging period comprises three planning periods. To specify this data, you have entered the following number of hours in the settings for the SMI Monitor:

  • Number of hours for the average-demand horizon =

    (Number of planning periods in the average-demand horizon)

    ×(Duration of a planning period in days)

    ×(24 hours)

  • Number of hours for the averaging period =

    (Number of planning periods in the averaging period)

    ×(Duration of a planning period in days)

    ×(24 hours)

SAP SNC uses this data to calculate an average demand for the first seven planning periods in the planning grid.

In the following table, the second row contains the actual demands, while the last row contains the final average demands.

Planning Period

1

2

3

4

5

6

7

8

Actual Demand

9

7

13

3

11

5

16

9

Average Demand

10

8

9

6

11

11

16

0

In this example, SAP SNC calculates the average demand values for the planning periods 1-5 by adding the demands in an averaging period and then dividing the total demand by the averaging period itself.

For example, to calculate the average demand value for planning period 1, SAP SNC adds the average demand values for planning periods 1, 2 and 3 and divides the total demand by the number of the periods in the averaging period (3).

(9+7+13)/3 = 9.67

SAP SNC rounds the value up to 10.

Similarly, to calculate the average demand value for planning period 2, SAP SNC adds planning periods 2, 3 and 4 and divides them by the number of the periods in the averaging period (3).

(7+13+3)/3 = 7.66

SAP SNC rounds the value up to 8.

In order to determine the average demand value for periods at the end of the average-demand horizon (where the averaging period exceeds the end of the average-demand horizons), SAP SNC uses the number of remaining planning periods as the averaging period. This is relevant for planning periods 6 to 7 .

So, for planning period 6, SAP SNC adds the demands from planning periods 6 and 7 and divides that value by the number of planning periods left in the average-demand horizon.

(5+16)/2 = 10.5

SAP SNC rounds the value up to 11.

SAP SNC calculates planning period 7 using the same principle.

16/1 = 16

For planning period 8, SAP SNC does not calculate the average demand as it lies outside of the average-demand horizon.