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Author's profile photo Atul Bhandari

Calculation of historical forecast error for inventory optimization

In the recent SAP Integrated Business Planning 6.1 release, the inventory application has added a new and exciting innovation to provide a systematic approach for the calculation of forecast error. Forecast error is one of the key inputs into safety stock planning. We have introduced a new forecast error calculation operator.


  • Enhancements to calculate and report the historical forecast error, which is input for inventory optimization in the calculation of safety stock
  • Provision of a systematic way to calculate historical forecast error for all combinations of product, location, and customer groups with weekly granularity
  • Features including special handling for intermittent items, forecast bias compensation, and outlier detection

Link to innovation:

Make sure that you expand the Product Features section and download the presentation titled “FORECAST ERROR” for fundamentals, details and screenshots.

The inventory applications sample planning area SAP3 has been updated to include the additional key figures and master data. If you have an existing planning area that is not copied from the SAP3 planning area in Release 6.1, please follow the steps in the above presentation.

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      Author's profile photo Former Member
      Former Member

      Hi Atul,

      Deck in innovation link is very useful. Thank you for sharing.

      Would it be possible for you to share more details on forecast error CV calculation with real example in spreadsheet? I tried examples you have in the deck and/or SAP HELP but with the data set you consider and the CV is mentioned in the deck, numbers don't add up. Also when Inventory is setup, CV that is being calculated (Venila, without any adjustments in demand or outlier), I am not able to prove CV calc.



      Harshil Desai