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Difference between Strategy 21(Holt) & Strategy 22( 2nd order exponential smoothing)

Apr 26, 2017 at 12:41 PM

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Hi guys,

Difference between Strategy 21(Holt) & Strategy 22( 2nd order exponential smoothing) as listed in APO DP.

G(t1) = alpha * V(t1) + (1-alpha) G(t1-1)

G(t2)= alpha * G(t1) + (1-alpha) G(t2-1)

Along with assumption used in SAP to calculate 1st ex-post point in the past

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Werner Hansen
Apr 28, 2017 at 04:57 PM
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Hi Bhaskar,

You can find the explanation for each strategy and their differences in the below links:

First-order exponential smoothing (21): https://help.sap.com/saphelp_scm50/helpdata/en/ac/216b83337b11d398290000e8a49608/content.htm

Second-order exponential smoothing (22): https://help.sap.com/saphelp_scm50/helpdata/en/ac/216b86337b11d398290000e8a49608/content.htm

Also, please check the follow link for more details:
https://help.sap.com/saphelp_scm50/helpdata/en/ac/216b6e337b11d398290000e8a49608/content.htm

Best regards,
Werner Hansen

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Please explain the formula below...

G(t)= alpha * V(t) + (1-alpha)* G(t-1)

while calculating G(t), why & how V(t) is involved into it. Please explain with example. No theoretical explanation required.

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