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/FRE/DIF_02 - Define Demand Influencing Factors

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Define the Demand Influencing Factors (DIF) that should be used in the demand forecast to calculate future demand.

A Demand Influencing Factor describes the basic properties of certain events or values that influence the demand for a product in a typical way. For example, a DIF may be a particular public holiday such as Easter or Christmas. An occurrence of this type of DIF, therefore, would be the sales period during which the public holiday has a heavy influence on the demand for a product. For public holidays, there is one occurrence each year. Other examples of DIFs are promotions or sales prices. All these DIFs have particular properties and their occurrences may recur over time or may change value. It is essential that the occurrences of a particular DIF have the same causal influence on demand for the product or its sales behavior, so that the demand forecast can calculate/predict the influence of future occurrences based on past occurrences.

Each DIF has unique number (identifier) and a name. You can also define the following:

• In the case of public holidays or promotions, for example, the DIF can either occur or not occur; in other words, it is boolean. A sales price, on the other hand, has a particular value at any given time; in other words, it is metric. You can also combine sporadic occurrences of a DIF with a value (for example, unusual weather incidents of varying intensity, such as hurricanes or heat waves). In addition, existing time series in the system (for example, sales by store) or time-dependent sales prices can also be used as metric DIFs(external DIF data sources). Other special types allow you to ignore historical demand values in the forecast and to correct forecast values by multiplying them by a defined factor.

• When you use an existing time series as a DIF, you must specify the parameter (key figure parameter) that determines the content of this time series.

• With metric DIFs, you have the option of specifying a currency or a unit of measure. These are used when displaying DIF values and for converting values during the import of data, but have no influence on the demand forecast.

• An additional option with metric DIFs is that you can specify a scaling factor, which is applied during transfer of values from external data sources (time series or sales prices) or during the import of data to scale the value range to the value range permitted for DIFs.

• Certain DIF types can be used as reference along with a consumption reference. You can define whether they are used as reference at all and whether the consumption reference multiplier is applied on the DIF value as well.

• At assignment level, you define the level on which DIF occurrences may be assigned to business objects; in other words, the objects for which the occurrences are valid. You can define this so that it always occurs on the location level or, in the case of individual products, within locations.

• During occurrences of a boolean DIF, you can define whether an outlier correction should be carried out in the demand forecast.

• It is possible to protect automatically generated occurrences of a DIF (that is to say, those generated using the inbound interface) against manual changes.

• For certain DIF types, more than one occurrence may be valid at the same time for the same location (and product). You can define a rule to handle such overlapsso that the demand forecast has a unique value for the DIF at any point in time.

• You can define a past time horizon in which the occurrences of a DIF can be changed and changes are taken into account in demand forecast. This is for performance purposes.

• For each DIF, you must define whether internal or external number assignment should be done and, if so, which number range interval should be used.

The use of DIFs must be evaluated during introduction of the project so that the Demand Influencing Factors relevant for the business processes can be determined and the required historical data for analysis in the system can be supplied. You can change the number or properties of the DIFs that are used in live operation, but this may greatly increase workload.

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