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When do you call Demand Intermittent?
When
ADI >= 1.32 and
CV Squared< 0.49 ADI – Average Demand Interval CV – Coefficient of Variation. (Look those up. I didn’t invent it) When ADI > 1.32 and
CV Squared> 0.49
You cannot really predict anything. (it’s called Lumpy series)
When
ADI < 1.32 and CV Squared> 0.49,
It’s called Erratic demand
When
ADI < 1.32 and
CV Squared < 0.49
You can make some sense of prediction.
How to use it?
(Kya ukhaad lunga jaan kar)
Ask your SAP ‘Expert’ from Elbonia to compute these values using macros (or somehow). This way you can do some sort of Forecast ability Analysis. Create Statistical Forecasting Groups/ Units. Come out of SKU mindset.
In fact, you can do a ton of things on your underlying info providers (data warehouse), to store any dynamic numeric/ranked/cardinal properties of the products whose demand you need to analyze. Use them as filters. Classes, Clusters, Degree of Association, Degree of Correlation, Volume Contri, Value Contri. Beyond ABC/XYZ statics. Because you need to VIEW the data along multiple dimensions before you begin to make any sense out of it. or derive additional insights you didn’t know before.
Don’t make your new cloud data warehouses and new supply chain solutions on this and that cloud another typewriter. Use science where do-able. The software costs a million dollars. Use consultants who KNOW the subject. Not configurators who do as directed.
For business/domain/industry understanding ask ChatGPT.
Don’t be fixated on customer’s stated requirements. Keep design flexible. Esp. when it comes to Analytical pursuits (whatever economics it serves)
And all of this needs no more knowledge than 10th standard Arithmetic. Don’t let PhDs believe otherwise. (I love PhD the degree appendage to name but I have nothing original to contribute. The useful stalwarts died long ago). For everything else there is AI.
Inputs from ARIJIT DUTTA
