What is coefficient in SAP SCM-APO-FCS - Demand Planning?

SAP Term: coefficient

• Component: SCM-APO-FCS

• Component Name: Demand Planning

• Description: In multiple linear regression, coefficients - or weights - of the independent variables describe the relative importance of the explanatory variables. Coefficients in a causal model indicate how changes in each of the independent variables X's influence the value of the dependent variable Y. For example, you can find out how increasing the product price by $1 would affect the sales quantity, assuming that all of the other variables remain constant.

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• Key Concepts: 
  Coefficient is a term used in SAP's Supply Chain Management-Advanced Planner and Optimizer-Forecasting and Demand Planning (SCM-APO-FCS Demand Planning) component. It is a numerical value that is used to adjust the forecasted demand for a particular item. The coefficient can be used to adjust the forecasted demand for seasonal variations, promotional activities, or other factors that may affect the demand for an item. 
  
  How to use it: 
  In SCM-APO-FCS Demand Planning, coefficients are used to adjust the forecasted demand for an item. The coefficient can be adjusted manually or automatically based on the user's preferences. To manually adjust the coefficient, the user can enter a numerical value in the coefficient field. To automatically adjust the coefficient, the user can select a forecasting method such as exponential smoothing or moving average. 
  
  Tips & Tricks: 
  When adjusting coefficients, it is important to consider the impact of seasonal variations and promotional activities on the forecasted demand for an item. Additionally, it is important to consider any external factors that may affect the demand for an item such as changes in market conditions or customer preferences. 
  
  Related Information: 
  For more information about using coefficients in SCM-APO-FCS Demand Planning, please refer to SAP's official documentation at https://help.sap.com/viewer/product/SCM_APO_FCS/7.5/en-US.