New LM4 Demand Forecasting Module

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Minimising inventory investment and increasing customer service by accurately forecasting demand.

One of the key business principles of managing an effective supply chain ( is to always start with customer demand. This should drive many of the decisions to be made regarding how much stock, and when and where to source it to meet the demand on time (or better), and in full to meet your customers' needs.

To achieve this there is a compelling need to be able to accurately forecast customer demand. Examining the business logic further, there needs to be a demand history from which there is sufficient confidence to forecast the future demand. Relying on the salesperson's forecast is not usually reliable enough or using statistical techniques based on exponential smoothing runs the risk of overstating demand and therefore overstocking. Relying on raw sales history to create a forecast may not achieve your goals either as this may include; one off exceptional demand; promotions; alternate products; product introductions and many other external real world events that usually skew what should have been the 'normal' demand. However, the Lakeview ( software product suite, including the Demand Forecasting module, can provide the supply chain professional with the tools and information to help identify exceptional demand, automate the forecasting and planning process whilst allowing for human intervention at each stage.

Demand Forecasting LM Module Overview - What is the Basis for LM Demand Forecasting?

This Lakeview ( module uses a technique known as 'Focus Forecasting' which was devised by Bernard T. Smith, a very well respected Production and Inventory Control pragmatist and consultant based in the USA. His theories are also endorsed by the Oliver Wight Foundation who formulated the concepts of MRP, DRP and MRP2.

The fundamental principles behind this forecasting technique are:
It ensures the demand history is accurate and free of any exceptional demand1.
Uses seven standard, simple and straightforward moving average forecasting methods that are easily understood and not based upon complex statistical 2. algorithms

Lets the system go back in time and simulate the last three months for each stock item as if they have not happened using each of the seven methods. The 3. system then automatically selects and uses the most accurate method to forecast the next 12 months for this stock item.

Simple Yet Flexible Forecasting - The seven forecasting methods delivered as standard within the Lakeview module calculate moving averages for the recent past, e.g. last 3 months. They also allow for similar periods in previous years as up to three years history can be maintained. This enables both trend and seasonality to be taken care of in the forecasting. The power of this module also lies in the ability of the supply chain professional to create his or her own forecast formulae based on moving averages. As a result, you are not restricted to those delivered by Lakeview and have the right to create and use your own formulae that are tailored to the specific needs of your business and marketplace.

Fully Integrated Planning ( - This Demand Forecasting module is integrated within the Lakeview LM4 software product and can easily access sales history and enable the user to review and amend this history and the generated forecasts. The forecasts can also be analysed in more depth using the Lakeview Supply Chain Analytics product or by using spreadsheets Once the forecasts are reviewed they can be transferred directly into MRP to create any purchase, transfer or works orders to meet future demand.

Feature Details - The Demand Forecasting module enables the supply chain professional to extract the sales history from within LM4 ( and summarise it so that it can be reviewed and modified to remove any exceptional demand, e.g. large one-off orders, promotional effects etc.

Once this demand history data is cleansed then the Demand Forecasting module can apply the forecast methods and select the most accurate forecast. This can be achieved by selecting certain products, e.g. by product group, planner, ABC Class, or for the whole product range that requires forecasting.

The resulting demand forecasts can then be reviewed and amended where necessary before transferring them into MRP where a time-phased match of supply to demand is calculated.

To assist the supply chain professional, reports can be provided that will display where the demand appears to be exceptional and also where any forecast error may be significant.

This enables time to be spent reviewing only those products where there are anomalies. Otherwise the system will automatically calculate and transfer the best forecast based on its calculations.

The sales history extract from LM, the demand forecasting calculations and the transfers to MRP and/or Supply Chain Analytics can all be set up as scheduled tasks, typically on a monthly basis.
Demand Forecasting LM Module Overview


A license to use the Demand Forecasting module needs to be purchased from Lakeview. A limited amount of training is required as the product is so intuitive and easy to use. Most users can be proficient within hours.

Complimentary Business Intelligence Solutions from Lakeview

Consider the Lakeview Supply Chain Analytics ( product which enables all of the forecast quantities, values and, forecast errors output from Demand Forecasting to be viewed and analysed in depth using the full drill down and around capabilities within the Analytics product.

The Lakeview MRP module allows the demand forecasts to be imported directly from this module without any rekeying. This means the MRP calculations can be run immediately and the suggested Purchase and Works Orders be reviewed and confirmed.

Why Lakeview? - A fully integrated solution…
Lakeview ( customers benefit from total integration across their entire business, through improved accuracy and integrity of data, and by making consistent and current information available to all company employees in real-time.

A system you can depend on…
A market leading service guarantee - we can provide the hardware as well as the software to ensure a reliable, stable and fully supported solution.

Supported and supplied by Lakeview…
Lakeview upgrade and support the software directly ( Our customers always have direct access to staff that understand the system, are involved in its development, and can offer a modification without referring to a third party.
Our solutions help you reduce costs and better connect with customers and suppliers. They allow you to meet industry-specific requirements, and make more profitable business decisions to unlock the potential of your business.

For more information about Lakeview, ( our products, or services please do not hesitate to contact your Account Manager directly.
Alternatively, please call on 0845 388 3329 or email info @
T: +44(0)845 388 3329 | F:+44(0)20 8303 6099 | E: info @© Lakeview Computers Ltd. Banks House, Banks Lane, Bexleyheath, Kent DA6 7BH

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Mark Greatrex
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