Measuring Forecast Error – Constrained or Unconstrained Forecast?
Is it better to correct the actual sales for supply constraints and come up with a version of the actual demand that is unconstrained?
Measurement is an ex-post event that should not affect the actual forecasting process. If the Sales force is encouraged to think about a constrained forecast, the organization will lose visibility to the true unconstrained demand.
One option will be to use a disciplined process to measure true demand every month and evaluat the unconstrained forecast with this version of true demand.