A forecast is the expected consumption of a part or group of parts as expressed in quantity or monetary value. The forecast is often based on historical results, known market activities, knowledge about new products, local market variations, and experience. Different business areas can store their own forecasts. Master scheduling (MS) and project master scheduling are based on the forecast you enter and the actual backlog of orders; they create a master schedule or a project master schedule, i.e. a manufacturing plan or a purchasing plan, from this information. MS means matching your company's sales forecast to the company's available resources and capacity in order to balance supply and demand.
Forecast consumption is the process of decrementing forecast based on the receipt of actual orders. The essence of forecast consumption is that forecast, together with actual demand, forms a blended picture of the total demand over the planning horizon. The actual demand consumes forecast in the forecast consumption process.
When an actual order is received, the system subtracts it from the forecast in the period the order is scheduled to ship. You can choose to relieve forecast in the period corresponding to the customer need date or in the original quoted shipment date. If there is no forecast remaining for the period, the system can consume forecast in earlier time periods. When a customer order line is booked or changed, a check is made toward the unconsumed forecast to determine whether the order line can be fulfilled.
Forecast consumption for Master Scheduled (MS) parts take place either when you run the MS Level 1 calculation, or when you enter or change a customer order line/sales quotation line. Forecast consumption for Material Requirement Planned (MRP) spare parts takes place when you enter or change a customer order line or a sales quotation line.
This section only describes the forecast consumption that takes place when you enter or change a customer order line or a sales quotation line. This is called online consumption. And it only describes online consumption for MS handled parts.
The essence of online consumption is that the forecast, together with actual demand, forms a composite picture of the total demand over the planning horizon. The actual demand consumes forecast real time in the online consumption process, provided that the demand is not marked as an Abnormal Demand or the parameter Use Abnormal Demands in Forecast Consumption is OFF.
The online consumption process works, when you enable the Online Consumption option for the inventory part, and the part you select should be a MS handled part with a forecast. In addition, for a sales quotation line, you must enable the Release for Planning option, on the sales quotation line.
The online consumption happens:
The online consumption functionality is dependent on the Promised Method in the MS Level 1 Part page. The promised method can be either Available to Promise or Unconsumed Forecast. The process consumes forecast within consumption window, for both the methods. Forward consumption will only consume forecasts within the forward forecast consumption and is only allowed in combination with the promise method Available to Promise (the details are given below). The process validates towards the MS plan for both the methods. The entry or the change you make can be either accepted or refused.
This is a range of days, defined for each part, in which forecast could be consumed for a customer order or a sales quotation. The default value for backward forecast consumption is 30 days, and the default value for forward consumption is 0 days, meaning no forward consumption at all.
If for example a value of 5 is entered in backward forecast consumption field, then when demand is entered for this part, forecasts are consumed going back up to 5 days from the due date of that demand. If further forecast/supply needs to be consumed to satisfy the demand order, then system tries to consume forward. Action message(s) are written for the part to inform the user about the forecast consumption, like for example “Insufficient unconsumed Forecast to satisfy Actual Demand”. The messages are connected to the forecast date.
You can choose what the system should do with any unconsumed forecasts that cross the demand time fence. There are two main principals, unconsumed forecasts can either roll out or can be dropped.
To roll out the unconsumed forecasts, the system rolls out or front loads any unconsumed forecasts crossing the demand time fence into the first period outside the demand time fence.
To drop unconsumed forecasts, the system does not roll out or front load any unconsumed forecasts crossing the demand time fence. The remaining forecasts are discarded.
In addition to the roll out of unconsumed forecast, you can also control the process in terms of time and quantity of unconsumed forecast to roll.
Max Unconsumed Forecast: Determines the upper limit of the total volume of unconsumed forecasts that can be rolled out.
Roll by Percentage: Controls how much of unconsumed forecast is allowed to roll out expressed as a percentage. The percentage factor is applied against single records and only the first time a record is being rolled out.
Roll Window: Defines how many calendar days a single record of unconsumed forecast will remain until being dropped by running MS calculation.
Forecast/Unconsumed Forecast within the demand time fence are ignored when the projected balance is calculated. The projected balance is calculated as follows:
Projected Balance (PB) = Current period PB + Current period supply - (Unconsumed forecast + Actual Demand)
The unconsumed forecast is calculated as follows:
Unconsumed Forecast = Current period forecast - Current period consumed forecast