What is model fit error in SAP SCM-IBP-DM - Demand?

SAP Term: model fit error

• Component: SCM-IBP-DM

• Component Name: Demand

• Description: A value showing how a forecast model fits the historical data. It is automatically calculated based on the error measures you have chosen for the forecast model.

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• Key Concepts: 
  Model fit error is a measure of how well a statistical model fits the data. It is used in SAP's Demand Planning component of SCM-IBP-DM to measure the accuracy of the demand forecast. The model fit error is calculated by comparing the actual demand with the forecasted demand. The lower the model fit error, the better the forecast accuracy. 
  
  How to use it: 
  The model fit error can be used to evaluate the accuracy of a demand forecast. It is calculated by comparing the actual demand with the forecasted demand. The lower the model fit error, the better the forecast accuracy. The model fit error can be used to identify areas where improvements can be made in order to increase forecast accuracy. 
  
  Tips & Tricks: 
  It is important to monitor the model fit error over time in order to ensure that it remains low and that any changes made to improve forecast accuracy are effective. Additionally, it is important to compare the model fit error with other measures of forecast accuracy such as mean absolute percentage error (MAPE) or mean absolute deviation (MAD). 
  
  Related Information: 
  For more information on model fit error and other measures of forecast accuracy, please refer to SAP's documentation on Demand Planning in SCM-IBP-DM. Additionally, there are many online resources available that provide further information on forecasting techniques and metrics.