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Another Look at Forecast Accuracy Metrics for Intermittent Demand

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  • Rob J. Hyndman

Abstract

Some traditional measurements of forecast accuracy are unsuitable for intermittent demand data because they can give infinite or undefined values. Rob Hyndman summarizes these forecast accuracy metrics and explains their potential failings. He also introduces a new metric-the mean absolute scaled error (MASE)-which is more appropriate for intermittent-demand data. More generally, he believes that the MASE should become the standard metric for comparing forecast accuracy across multiple time series. Copyright International Institute of Forecasters, 2006

Suggested Citation

  • Rob J. Hyndman, 2006. "Another Look at Forecast Accuracy Metrics for Intermittent Demand," Foresight: The International Journal of Applied Forecasting, International Institute of Forecasters, issue 4, pages 43-46, June.
  • Handle: RePEc:for:ijafaa:y:2006:i:4:p:43-46
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    Cited by:

    1. Victor Richmond R. Jose, 2017. "Percentage and Relative Error Measures in Forecast Evaluation," Operations Research, INFORMS, vol. 65(1), pages 200-211, February.
    2. Hill, Arthur V. & Zhang, Weiyong & Burch, Gerald F., 2015. "Forecasting the forecastability quotient for inventory management," International Journal of Forecasting, Elsevier, vol. 31(3), pages 651-663.
    3. Altay, Nezih & Rudisill, Frank & Litteral, Lewis A., 2008. "Adapting Wright's modification of Holt's method to forecasting intermittent demand," International Journal of Production Economics, Elsevier, vol. 111(2), pages 389-408, February.
    4. repec:lrk:eeaart:35_2_5 is not listed on IDEAS
    5. repec:eee:ejores:v:266:y:2018:i:2:p:395-414 is not listed on IDEAS
    6. Kim, Sungil & Kim, Heeyoung, 2016. "A new metric of absolute percentage error for intermittent demand forecasts," International Journal of Forecasting, Elsevier, vol. 32(3), pages 669-679.
    7. Emilian Dobrescu, 2014. "Attempting to Quantify the Accuracy of Complex Macroeconomic Forecasts," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 5-21, December.
    8. Jussim, Maxim, 2014. "Entwicklung eines Simulationstools zur Analyse von Prognose- und Dispositionsentscheidungen im Krankenhausbereich," Bayreuth Reports on Information Systems Management 57, University of Bayreuth, Chair of Information Systems Management.
    9. Heinecke, G. & Syntetos, A.A. & Wang, W., 2013. "Forecasting-based SKU classification," International Journal of Production Economics, Elsevier, vol. 143(2), pages 455-462.
    10. Altay, Nezih & Litteral, Lewis A. & Rudisill, Frank, 2012. "Effects of correlation on intermittent demand forecasting and stock control," International Journal of Production Economics, Elsevier, vol. 135(1), pages 275-283.
    11. Andrawis, Robert R. & Atiya, Amir F. & El-Shishiny, Hisham, 2011. "Combination of long term and short term forecasts, with application to tourism demand forecasting," International Journal of Forecasting, Elsevier, vol. 27(3), pages 870-886, July.
    12. Theodosiou, Marina, 2011. "Forecasting monthly and quarterly time series using STL decomposition," International Journal of Forecasting, Elsevier, vol. 27(4), pages 1178-1195, October.
    13. Syntetos, Aris A. & Nikolopoulos, Konstantinos & Boylan, John E. & Fildes, Robert & Goodwin, Paul, 2009. "The effects of integrating management judgement into intermittent demand forecasts," International Journal of Production Economics, Elsevier, vol. 118(1), pages 72-81, March.
    14. Michel Fliess & C├ędric Join & Cyril Voyant, 2018. "Prediction bands for solar energy: New short-term time series forecasting techniques," Post-Print hal-01736518, HAL.
    15. Kolassa, Stephan, 2016. "Evaluating predictive count data distributions in retail sales forecasting," International Journal of Forecasting, Elsevier, vol. 32(3), pages 788-803.
    16. Davydenko, Andrey & Fildes, Robert, 2013. "Measuring forecasting accuracy: The case of judgmental adjustments to SKU-level demand forecasts," International Journal of Forecasting, Elsevier, vol. 29(3), pages 510-522.
    17. repec:pal:jorsoc:v:60:y:2009:i:3:d:10.1057_palgrave.jors.2602569 is not listed on IDEAS
    18. repec:gam:jeners:v:10:y:2017:i:10:p:1534-:d:114003 is not listed on IDEAS

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