Forecasting Performance

Forecasting process improvement begins with process measurement. There are dozens of available forecasting performance metrics. Some, like mean absolute percent error (MAPE), represent error as a percentage. Others, like mean absolute error (MAE), are scale dependent. Relative-error metrics (such as MASE) compare performance versus a benchmark (typically a naïve model). Each metric has its place—a situation where it is suitable to use and informative.