Published on: Jan, 19, 2011
The difference between actual demand and forecast demand, stated as an absolute value or as a percentage. E.g., average forecast error, forecast accuracy, mean absolute deviation, tracking signal. There are three ways to accommodate forecasting errors: One is to try to reduce the error through better forecasting. The second is to build more visibility and flexibility into the supply chain. And the third is to reduce the lead time over which forecasts are required.
Source: http://www.apics.org/ (10th ed.)
Read the Supply Chain Management Professional Newsletter
Read the latest supply chain research, articles, and news as soon as we post them.