On the bias of intermittent demand estimates

Management Science

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On the bias of intermittent demand estimates. / Syntetos, A. A.; Boylan, John.
In: International Journal of Production Economics, Vol. 71, No. 1-3, 01.05.2001, p. 457-466.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Syntetos, AA & Boylan, J 2001, 'On the bias of intermittent demand estimates', International Journal of Production Economics, vol. 71, no. 1-3, pp. 457-466. https://doi.org/10.1016/S0925-5273(00)00143-2

APA

Syntetos, A. A., & Boylan, J. (2001). On the bias of intermittent demand estimates. International Journal of Production Economics, 71(1-3), 457-466. https://doi.org/10.1016/S0925-5273(00)00143-2

Vancouver

Syntetos AA, Boylan J. On the bias of intermittent demand estimates. International Journal of Production Economics. 2001 May 1;71(1-3):457-466. doi: 10.1016/S0925-5273(00)00143-2

Author

Syntetos, A. A. ; Boylan, John. / On the bias of intermittent demand estimates. In: International Journal of Production Economics. 2001 ; Vol. 71, No. 1-3. pp. 457-466.

Bibtex

@article{a4802157c85041a2849c8cb0ef74cec7,

title = "On the bias of intermittent demand estimates",

abstract = "Forecasting and inventory control for intermittent demand items has been a major problem in the manufacturing and supply environment. Croston (Operational Research Quarterly 23 (1972) 289), proposed a method according to which intermittent demand estimates can be built from constituent events. Croston's method has been reported to be a robust method but has shown more modest benefits in forecasting accuracy than expected. In this research, one of the causes of this unexpected performance has been identified, as a first step towards improving Croston's method. Certain limitations are identified in Croston's approach and a correction in his derivation of the expected estimate of demand per time period is presented. In addition, a modification to his method that gives approximately unbiased demand per period estimates is introduced. All the conclusions are confirmed by means of an extended simulation experiment where Croston's and Revised Croston's methods are compared. The forecasting accuracy comparison corresponds to a situation of an inventory control system employing a re-order interval or product group review.",

keywords = "Forecasting, Inventory, Intermittent demand",

author = "Syntetos, {A. A.} and John Boylan",

year = "2001",

month = may,

day = "1",

doi = "10.1016/S0925-5273(00)00143-2",

language = "English",

volume = "71",

pages = "457--466",

journal = "International Journal of Production Economics",

issn = "0925-5273",

publisher = "Elsevier Science B.V.",

number = "1-3",

}

RIS

TY - JOUR

T1 - On the bias of intermittent demand estimates

AU - Syntetos, A. A.

AU - Boylan, John

PY - 2001/5/1

Y1 - 2001/5/1

N2 - Forecasting and inventory control for intermittent demand items has been a major problem in the manufacturing and supply environment. Croston (Operational Research Quarterly 23 (1972) 289), proposed a method according to which intermittent demand estimates can be built from constituent events. Croston's method has been reported to be a robust method but has shown more modest benefits in forecasting accuracy than expected. In this research, one of the causes of this unexpected performance has been identified, as a first step towards improving Croston's method. Certain limitations are identified in Croston's approach and a correction in his derivation of the expected estimate of demand per time period is presented. In addition, a modification to his method that gives approximately unbiased demand per period estimates is introduced. All the conclusions are confirmed by means of an extended simulation experiment where Croston's and Revised Croston's methods are compared. The forecasting accuracy comparison corresponds to a situation of an inventory control system employing a re-order interval or product group review.

AB - Forecasting and inventory control for intermittent demand items has been a major problem in the manufacturing and supply environment. Croston (Operational Research Quarterly 23 (1972) 289), proposed a method according to which intermittent demand estimates can be built from constituent events. Croston's method has been reported to be a robust method but has shown more modest benefits in forecasting accuracy than expected. In this research, one of the causes of this unexpected performance has been identified, as a first step towards improving Croston's method. Certain limitations are identified in Croston's approach and a correction in his derivation of the expected estimate of demand per time period is presented. In addition, a modification to his method that gives approximately unbiased demand per period estimates is introduced. All the conclusions are confirmed by means of an extended simulation experiment where Croston's and Revised Croston's methods are compared. The forecasting accuracy comparison corresponds to a situation of an inventory control system employing a re-order interval or product group review.

KW - Forecasting

KW - Inventory

KW - Intermittent demand

U2 - 10.1016/S0925-5273(00)00143-2

DO - 10.1016/S0925-5273(00)00143-2

M3 - Journal article

VL - 71

SP - 457

EP - 466

JO - International Journal of Production Economics

JF - International Journal of Production Economics

SN - 0925-5273

IS - 1-3

ER -

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