Utilizing Time Fences in Forecast Pro TRACSometimes making changes to near-term forecasts can be an expensive proposition. Last minute changes often significantly increase production and procurement costs, decrease profitability, and negatively impact other aspects of the business. To protect against these effects, many companies establish “time fences” to prohibit changes to the forecast over a defined short-term horizon. This edition of Tips & Tricks details how to set time fences in Forecast Pro TRAC to prevent new statistical forecasts from being generated and/or new forecast overrides from being applied within the fenced horizon.

Establishing a Time Fence

For most Forecast Pro TRAC users, the three basic steps of each forecast cycle are:

  1. Import the most current historical data
  2. Generate a new statistical forecast from the updated data
  3. Add judgmental input by adjusting/overriding the statistical forecast

The Forecast Pro TRAC screenshot below displays a forecast graph along with the Forecast overrides grid. In the example, the forecast period (or horizon) runs from October 2016 through September 2017. Note that the final forecast for item COR-12-11 (shown in the row labeled “Forecast”) matches the Statistical row for both the October forecast (25,710) and the November forecast (24,286), while the final forecast for December (55,000) is based on an override.

Utilizing Time Fences in Forecast Pro TRAC

If you want to enforce a policy that the forecast cannot be changed in the first two months of the forecast horizon—in the example above, October and November—Forecast Pro TRAC allows you to define and apply a time fence. To do so, you need to:

  1. Define the length of the time fence (i.e., the number of forecast periods to lock)
  2. Apply the time fence

Defining the length of the time fence

The default length for the time fence is specified via the Override tab of the Options dialog box. To access the Overrides tab select Settings>Options from the main menu and then click on the Overrides tab (shown in the screenshot below). Note that the Number of periods field, located in the Time Fence section of the dialog box, is set to “2.” This means that when the time fence is applied, the first two periods in the horizon will be locked or “fenced.”

Utilizing Time Fences in Forecast Pro TRAC

Applying the time fence

When you first create a project, the time fence will be turned off. You can turn on the time fence by selecting Operations>Time Fence>Enable.
Note: Once you turn a project’s time fence on, it cannot be turned off!

Utilizing Time Fences in Forecast Pro TRAC

The screenshot below displays the result of applying a two-period time fence in our example. Notice that the first two forecast periods in the Forecast overrides grid (October and November) are shaded in red, indicating that those two periods are fenced. The overrides grid also contains an additional row labeled “Time Fence.” Since neither October nor November has any overrides, the Time Fence row contains the same values as the Statistical row. If there were any overrides, then the Time Fence row would contain the override values.

Utilizing Time Fences in Forecast Pro TRAC

Moving to the Next Forecast Cycle When Time Fences Have Been Applied

When you open your forecast project at the next forecast cycle (next month in this example), update your historical data and generate a new statistical forecast, the first two forecast periods will still be fenced (see screenshot below). In this example, the updated 12-month forecast horizon now spans from November 2016 to October 2017. Notice that the fenced forecast periods are now November 2016 and December 2016 (the first two periods of the updated forecast horizon).

Utilizing Time Fences in Forecast Pro TRAC

Although the statistical forecasts for item COR-12-11 for November and December have been recalculated based on the updated historical data (i.e., we added a month of history), the final forecast shown in the Forecast row still reflects the time fenced values that were established in the previous forecast cycle.

Global Time Fences vs. Item-Specific Time Fences

When the length of the time fence is set via the Overrides tab (as shown previously), the time fence length is applied globally. This means that all items and groups will have the same time fence length.

If you need to have item-specific time fences, you can override the global setting on an item-by-item basis using the custom modifier \TIMEFENCE=n, where n is the number of periods you wish to fence. Be aware that if you use the \TIMEFENCE=n modifier to create a time fence shorter than the global time fence, it will shorten the time fence for all associated parent groups of the item. In the screenshot below, the time fence for the item BRA-12-11 has been set to four periods via the \TIMEFENCE=4 modifier. Note that the first four periods in the forecast horizon for this item are shaded, indicating that this is a fenced period.

Utilizing Time Fences in Forecast Pro TRAC


Extended Use of Time Fence Logic to Lock the Current Forecast

Selecting Operations>Time Fence>Freeze Next Period will increase the length of all time fences in the current project by one period for the current forecast origin. If you subsequently update your data with the next observation and create a new forecast (thus changing the forecast origin), the time fence lengths will revert back to their pre-Freeze-Next-Period settings. This option provides a way of ensuring that after the forecasts are finalized someone doesn’t inadvertently alter the frozen periods’ forecasts prior to: the data being updated; new forecasts being generated; and the frozen periods’ forecasts becoming officially fenced values.

Time fences are just one of the useful features in Forecast Pro TRAC that help to improve your forecasting.

To learn more you can: