A summary of tested principles I composed on improving forecast accuracy for a more reliable and efficient supply chain operation. These tips can be useful for Demand Managers and forecasters especially in a market involving wholesalers and distributors.

1. Improving
Forecast
Accuracy
ONUR SEZGIN
DEMAND AND PROCESS MANAGER
ABBOTT LABORATORIES - EPD TURKEY

2. BIGGEST
CONTRIBUTORS
TO ERROR
FOCUS
ON

3. Find out
WHAT
to improve

4. Repeat your
analysis
every month!
Findoutwhat
toimprove

5. Do you see
a pattern?

6. DO NOT SETTLE EASILY
ANALYZE
MORE

7. Always keep
an eye on
TRENDS

8. Is the error coming from a
particular forecaster?

9. Let
them
know
over a
coffee
Photo Credit: juliuskoroll
https://www.flickr.com/photos/67975868@N07/

10. Build a Forecast
Waterfall!
Photo Credit: philippe leroyer
https://www.flickr.com/photos/philippeleroyer/3871752748/

11. WITH YOUR POSITIVE
PERSISTENCE
OVERCOME
RESISTANCE
Photo Credit: John Pedersen
https://www.flickr.com/photos/slipperytiger/143789456

12. PEOPLE TEND TO MAKE
EXCUSES
But my in market
sales forecast
accuracy is good.
My product is sold more to
compensate for other
product, it is not my fault.
But we have to deliver the
plan, so we have to input
this forecast.
I do not have time
to compile a better
forecast.

13. Communicate
more frequently
Photo Credit: aquopshilton
https://www.flickr.com/photos/76804652@N02/7158670888

14. Create
Accountability
Photo Credit: Nguyen Hung Vu
https://www.flickr.com/photos/vuhung/8095592977

15. FORECAST ACCURACY
MEASURE
IN MARKET
Photo Credit: John Pedersen
https://www.flickr.com/photos/slipperytiger/143789456

17. MAKE TIME FOR THEM
RCA & CAP
Photo Credit: MTSOfan
https://www.flickr.com/photos/mtsofan/16341418531

18. CAP should
be Almost Always
Related to a
Change in
the Forecast
Photo Credit: Arthur John Picton
https://www.flickr.com/photos/arthurjohnpicton/4383221264/

19. BALANCE
IM & TM
IN MARKET AND TO MARKET
Photo Credit: Christopher A. Dominic
https://www.flickr.com/photos/kestereverts/14333646903/in/photostream/

20. Reconcile More Frequently
with Customers
Photo Credit: Chris Beckett
https://www.flickr.com/photos/chrisjohnbeckett/16917511337/

21. have
targets
for
in market
inventory
levels
Photo Credit: Chris Beckett
https://www.flickr.com/photos/chrisjohnbeckett/16917511337/

22. Sales and
Marketing
forecasts
in market
Channel
Mngment
forecasts
to market
Photo Credit: Alexander Rentsch
https://www.flickr.com/photos/captain_die/8599206193/

23. DEVELOP
ENABLING
TOOLS
AND KEEP IMPROVING
Photo Credit: Alan
https://www.flickr.com/photos/kaptainkobold/5359290323

24. Photo Credit: Lucas Lin
https://www.flickr.com/photos/lucaslin/6546996873/
Do not try to do
improvements
on your own

25. What do forecasters do
every month to update
their forecast?

26. PREVIOUS SITUATION
• 6 Product Managers, 6 Different Forecasting
Files
• No single data source:
To MKT
Sales from a
PDF BPCS
Report
In MKT
Sales from
an SFE
Report
FOC
realization
from a CS
Report
Previous
forecast from
previous
forecasting file
PLAN and LBE
data from a
Finance File

27. PREVIOUS SITUATION
• Unreliable In Market inventory
• Complicated FOC Realization Tracking
• No systematical archiving
• Too Long Preparation and Setup needed
before Demand Review
• Previous Forecast overwritten

28. CURRENT SITUATION
• Frequently Reconciled In Market inventory
• Speeded up FOC process
• Archiving standardized in the shared folder
• Most of the necessary data for forecasting is
consolidated by DM and circulated
• All 8 Line ADS Elements are incooperated with
Plan, LBE, Previous ADS and ADS Dimensions
• Demand Manager File and PM File
Communication is achieved

29. SOME KEY POINTS
• Keep Lag 3 visible
• Simulate KPI realization in the forecasting tool
• Make Frozen Period visible and known
• Use graphs to analyze trends and variances
versus plan and previous forecast
• Create easy comparison vs. benchmarks
• Automated Summary Reports for fast reviews

30. FOLLOW UP
FINE TUNE
WITHIN THE MONTH
Photo Credit: Christopher A. Dominic
https://www.flickr.com/photos/kestereverts/14333646903/in/photostream/

31. Estimate Month End
In MKT Sales Within the
Month

32. Track
Forecast
Accuracy
Within the
Month
Photo Credit: Matt MacGillivray
https://www.flickr.com/photos/qmnonic/5549035548/

33. So...
Results?
Photo Credit: Zoe Guerrini
https://www.flickr.com/photos/zoeorangejuice/5520846494/

34. Forecast Accuracy

35. SP&E

36. Photo Credit: Jesse Scott
https://www.flickr.com/photos/75628938@N00/6940356708
Onur Sezgin
ABBOTT LABORATORIES
EPD TURKEY
DEMAND AND PROCESS
MANAGER
Thank you