MAD values not matching as per the formula.

[Former Member]

Hi,

Has anybody have an idea how does SAP calculates MAD . We are comparing MAD as per the formula- MAD@t= smoothing factor alpha( demand@t- forecast@t)+ mad@(t-1)

But SAP values dont seem to match. How is the initial value calculated here?

Regards,

[srinivas_krishnamoorthy · Accepted solution]

The formula SAP uses is in

http://help.sap.com/saphelp_scm41/helpdata/en/ac/216ba1337b11d398290000e8a49608/frameset.htm

The factor of (1-alpha) seems to be missing in your formula.

The initial value is calculated using ex-post forecast instead of forecast. So MAD calculations start happening from the time ex-post is calculated.

[Former Member · Accepted solution]

Hi,

Actually i had used the right formula only. Missed 1- aplha in last mail.

Still it does not match. and here MAD values are calculated before the expost forecast

Could it be some other issue.

[srinivas_krishnamoorthy · Accepted solution]

Is the formula matching after the ex-post starts and particularly in the immediate past bucket? Am not sure on how MAD is calculated before the ex-post period.

[Former Member · Accepted solution]

It is not matched even when expost forecast starts..By the way , this is happening for SAP SPP module