Example: Calculation Based on the Moving 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 Supply Network Collaboration (SAP SNC) uses this data to calculate an average demand for the first seven planning periods in the planning grid. Since the averaging period comprises three planning periods, SAP SNC divides the average-demand horizon into time segments with a maximum length of three planning periods. Since the number of planning periods in the averaging period is smaller than the number of planning periods in the average-demand horizon, SAP SNC calculates three demand sets as interim steps toward the final average demand.

In the following table, the second row contains the actual demands.The following three rows contain the demands from the three demand sets, while the last row contains the final average demands.

 

To calculate the final average demand of the planning periods in the average-demand horizon, SAP SNC proceeds as follows:

SAP SNC calculates the first demand set from the actual demands (see second row in the table):

SAP SNC subdivides the average-demand horizon of seven planning periods into the following time segments:

The first time segment contains planning period 1.

The second and the third time segments contain three planning periods each; the planning periods 2, 3, and 4 or 5, 6, and 7 respectively.

SAP SNC averages the demands in the time segments of the average-demand horizon.

Since the first time segment only contains one planning period, no averaging is required in this case.The demand for the first planning period is 9.

To calculate the average demand in the planning periods of the second time segment, SAP SNC adds up the actual demands and divides the sum by the number of planning periods. This results in a demand of (7 + 13 + 3)/3 = 7.67.

The average demand in the third time segment is (11 + 5 + 16)/3 = 10.67.

SAP SNC calculates the second and third demand set accordingly (see third and fourth row in the table). The only difference to the first demand set is that SAP SNC subdivides the average-demand horizon into other time segments as follows:

In the second demand set, the first time segment contains the planning periods 1 and 2. An average demand of (9 + 7)/2 = 8 is the result for these planning periods. Then there is a time segment with the same duration as the averaging period (planning periods 3, 4, and 5), with the average demand (13 + 3 + 11)/3 = 9. The last time segment contains only two planning periods – planning periods 6 and 7 – with the average demand (5 + 16)/2 = 10.5.

SAP SNC proceeds in the same way for the third demand set, whose first time segment contains three planning periods.

SAP SNC then calculates the final average demand for each planning period (see last row in the table). To do so, SAP SNC adds up the three average demands from the three demand sets and divides the sum by three.

The average demand of the first planning period is calculated as follows: (9 + 8 + 9.67)/3 = 8.89 (see first column in the table). SAP SNC rounds this value up to 9.

The average demand of the second planning period is calculated accordingly as follows: (7.67 + 8 + 9.67)/3 = 8.45 (see second column in the table). SAP SNC rounds this value down to eight.

The average demands of the remaining planning periods in the average-demand horizon are calculated accordingly.