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THE OUTSIDE-IN PLANNING HANDBOOK | 2023
systems to ensure better outputs. In the class, we measured forecastability using the Coefficient of Variation (COV) and segmented demand by stream. The results in Figure 3 are typical for the average manufacturer in the class. Only 54% of
items are forecastable using item/location forecasting based on order history. Fewer items became forecastable throughout the pandemic using history as a proxy for demand.
Figure 3. Forecastability from a Class Participant
25% of Items High Fill Rate
15% of Items Moderate Fill Rate
29% of Items High Fill Rate
31% of Items Lowest Case Fill Rate
Forecastability (Coefficient of Variability)
In an outside-in process, forecastability is tested. The model flags items not forecastable by the model and recommends changes to the model to improve forecastability.
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