3 Preprocessing Analysis Workbook

Preprocessing is performed to account for stock out situations and short lifecycle items in regards to item start and exit periods. Since sales history during stock-out situations and the launch and exit of an item is not a true indicator of demand, SPO has sophisticated preprocessing techniques to identify and flag these situations so that such data points are not taken into account while computing size profiles.

Introduction

The Preprocessing Analysis workbook contains the following tabs:

Preprocessing Administration Tab
Preprocessing Results Tab
Preprocessing Summary Statistics Tab

The Preprocessing Analysis workbook allows users to tune, override, and review the impact of updating preprocessing parameters before committing their updates to the preprocessing parameters. These updated parameters will then be utilized by the next SPO batch run.

Note:

The results of preprocessing viewed within the Preprocessing workbook are not committed back to database; only the parameters themselves can be committed back to database.

Preprocessing is executed prior to actual size profile generation in the SPO batch. Preprocessed or filtered sales history is used to generate size profiles.Preprocessing has a nested approach to evaluating eligibility (or valid data points for consideration for size profile generation). The system first tries to identify start and end dates for all SKU/stores, then it looks at historic sales and inventory data and eliminates data points with insufficient history and inventory at the start and end of an item lifecycle.

Note:

The default setting for preprocessing filtering in SPO is only executed for fashion items. It ignores all basic items. If you want to use preprocessing for basic items, see the SPO Implementation Guide for instructions.

Note:

The start and end date of an item lifecycle are identified by season start and end dates for fashion SKUs.

After the item start and end date of a SKU/store is identified, its season length is calculated as

(end_dt - start_dt) / 7 + 1.

Next, the SKU/store/week, SKU/store, SKU parent/store, and SKU parent/store/week level data points are evaluated for eligibility.

Note that if a SKU/store or SKU parent/store is considered ineligible, all corresponding data points (down to the SKU/store/week level) are considered ineligible for size profile calculation.

The following points outline the preprocessing process:

SKU/store/week level eligibility is determined based on:
- The SKU/store/week lying within the start and end dates determined above.
- No out of stock situation was observed for that SKU/store/week.
  - Criteria for stock out situation is again based on user specified thresholds for inventory levels (Inventory Units and Max Inventory Percentage threshold) and observed sales was above a certain user specified threshold (Sales Unit threshold - SKU/store/week eligibility).
- If it belongs to an eligible SKU/store (criteria described below).
SKU/store level eligibility is determined based on:
- Season length for the SKU/store is long enough (season length threshold).
- Total sales for the SKU/store are not below a certain user-defined threshold (total sales threshold).
- The SKU/store has significant eligible sales periods within its season length.
  - This is determined by taking the ratio of total eligible season weeks of the SKU/store to its season length and checking to see if it is above a user-defined threshold (eligible weeks percentage).
SKU parent/store/week eligibility is determined by:
- For each given store, for the given week, if the SKU parent has significant enough SKUs (based on a user-defined threshold) that are eligible for that store/week, then the SKU parent is eligible for that store/week. Also, the number of SKUs should be greater or equal to certain percentage of the total number of sizes in the corresponding size range (the percentage is set by user).
- If it belongs to an eligible SKU parent/store (criteria determined as below).
SKU parent/store eligibility:
- Start and end dates calculated as median of the start and end dates of SKU/stores.
- Number of eligible weeks for the SKU parent is greater than a user-defined threshold.
- Number of eligible SKUs for the SKU parent is greater than a user-defined threshold.
- The total sales units are greater or equal to certain threshold (set by user) for given SKU parent/store.

Preprocessing for Normalized Size and Optimized Size Profile

The following table provides a comparison of preprocessing.

Table 3-1 Comparison of Preprocessing

Concepts	Normalized Size Profile	Optimized Size Profile
Definition	Preprocessing for Normalized Size Profiles considers the number of eligible SKU/store/weeks to determine if a style-color/store/week is eligible.	Preprocessing for Optimized Size Profiles tries to utilize more data, by not rejecting non-stocked out SKU/store/weeks even if other sizes in the style-color had stocked out. This is because Optimized Size Profiles tries to estimate demand for the style-color/week/store first, and then calculates size profile distributions for the style-color.
Stocks Included for Size Profile	In the event of a stock out in certain sizes for a given week, if the number of stocked out SKUs for the week exceeds a certain fraction (user defined threshold) of the total number of sizes in the size range, then the entire style-color/store/week is considered ineligible (or discarded by preprocessing).	A sku/store/week is considered eligible if it belongs to an eligible sku-parent/store/week.
Mask Measures	Normalized Sales Profile Elig Flag.	Eligible Optimized Size Profile Mask.

Using the Preprocessing Analysis Workbook

The following diagram outlines how to use the Preprocessing Analysis workbook:

Figure 3-1 How to Use the Preprocessing Analysis Workbook

Planning Action

The following planning action is available for the Preprocessing Analysis workbook:

Preprocessing

The Preprocessing planning action is used to initiate Preprocessing. The Preprocessing planning action is a batch process. This planning action cleanses historic data based on user set parameters, and thresholds.

Figure 3-2 Planning Action for the Preprocessing Analysis Workbook

Preprocessing Analysis Wizard

To open the Preprocessing Analysis workbook:

From the File menu, select New or click the New button.
On the SizeOpt tab, select Preprocessing Analysis and click OK.

Figure 3-3 Creating a Preprocessing Analysis Workbook
The Available Product screen is displayed. Select the products you want to analyze and for which you want to update parameters, and click Next.

Figure 3-4 Preprocessing Analysis Wizard - Available Product Screen
The Available Location screen is displayed. Select the locations you want to examine, and click Next.

Figure 3-5 Preprocessing Analysis Wizard - Available Location Screen
The Available Weeks screen is displayed. Select the weeks of history you want to examine and click Finish. Note that all weeks selected are considered for preprocessing.

Figure 3-6 Preprocessing Analysis Wizard - Available Weeks Screen

The Preprocessing Analysis workbook is built.

Preprocessing Administration Tab

On the Preprocessing Administration tab, you can review default settings and specify item/location specific overrides if necessary. If certain special overrides need to be specified, SPO allows users to do so at the SKU/location or SKU parent/location level, depending on the override measure.

The following sections describe the worksheets available on the Preprocessing Administration tab:

Default Season Start/End Dates for Preprocessing Worksheet
Default Parameters for Preprocessing Worksheet
Overrides Worksheet

Default Season Start/End Dates for Preprocessing Worksheet

The season start/end dates for preprocessing are displayed in this worksheet. These represent the range of dates for which size profiles are being determined.

Figure 3-7 Default Season Start/End Dates for Preprocessing Worksheet

Table 3-2 Default Season Start/End Dates for Preprocessing Worksheet Measure

Measure	Description
Default Season Start Date	Used for fashion items, this is the date that indicates the season start date. Used for preprocessing.
Default Season End Date	Used for fashion items, this is the date that indicates the season end date. Used for preprocessing.

Default Parameters for Preprocessing Worksheet

Figure 3-8 Default Parameters for Preprocessing Worksheet

Note:

Worksheet cells are hatched if they are scalar measures. To see the value, roll up the product hierarchy to All [Product].

The following table describes the measures available on this worksheet.

Table 3-3 Default Parameters for Preprocessing Worksheet Measures

Measure	Description
Default History Start Date	Used to determine the history start date for the preprocessing window.
Default History End Date	Used to determine the history end date for the preprocessing window.
Sales Unit Threshold (Start/End Date)	The first and last date of history where sales units exceed this measure are used in the season length calculation.
Sales Plus Inventory Unit Threshold (Start/End Date)	The first and last date of history where the sum of sales and inventory exceed this measure are used in the season length calculation.
Maximum Inventory Percentage Threshold (Start/End Date)	The first and last date of history where ratio of sales plus inventory to maximum inventory for the SKU/Store exceed this threshold are used in the Season length calculation.
Max Inventory Percentage Threshold (SKU/Store/Week Eligibility)	The SKU/store/week is considered eligible only if its inventory expressed as a percentage of the maximum inventory for the SKU/store is greater than the max inventory percentage threshold specified.
Sales Unit Threshold (SKU/Store/Week Eligibility)	The SKU/store/week is considered eligible for size profile generation only if, the sales units for a given week, for that SKU/store need to exceed this sales unit threshold value.
Sales Plus Inventory Unit Threshold (Sku/Store/Week Eligibility)	The SKU/store/week is considered eligible for size profile generation only if, the value of the sum of sales and inventory of a given week, for that SKU/store need to exceed this Sales plus Inventory Unit Threshold value.
Eligible Weeks Percentage Threshold (SKU/Store Eligibility)	The minimum ratio of eligible weeks to season length needed for the SKU/Store to be considered eligible
Total Sales Threshold (SKU/Store Eligibility	Used in the SKU/store eligibility check. If the total sales for a SKU/store exceed this threshold, then it is considered eligible.
Season Length Threshold (SKU/Store Eligibility)	A SKU/store is considered eligible if its season length calculated is above this threshold.
Eligible SKUs Percentage Threshold - Optimized (SKU Parent/Store/Week Eligibility)	If the total number of eligible SKUs for a given SKU parent/store/week expressed as a percentage of total SKUs exceeds the threshold, then the SKU parent/store/week is considered eligible. This is for the optimized generation method.
Eligible SKUs Threshold - Optimized (SKU Parent/Store Eligibility)	If the number of eligible SKUs for a given SKU parent/store exceeds this threshold, the SKU parent/store is considered eligible. This is for the optimized generation method.
Eligible SKU's Percentage Threshold - Normalized (SKU Parent/Store/Week Eligibility)	.If the total number of eligible SKUs for a given SKU parent/store/week expressed as a percentage of total SKUs exceeds the threshold, then the SKU parent/store/week is considered eligible. This is for the normalized generation method.
Eligible SKU's Threshold - Normalized (SKU Parent/Store Eligibility)	If the number of eligible SKUs for a given SKU parent/store exceeds this threshold, the SKU parent/store is considered eligible. This is for the normalized generation method.
SKU Parent/Store Eligible Week Threshold (SKU Parent/Store Eligibility)	SKU parent/store eligible weeks threshold, used in SKU parent/store eligible calculation. Minimum number of weeks required for the SKU parent/store to be considered eligible.
Total Sales Threshold (SKU Parent/Store Eligibility)	Used in the SKU parent/store eligibility check. If the total sales for a SKU parent/store exceed this threshold, then it is considered eligible.
Eligible SKU's Threshold (SKU Parent/Store/Week Eligibility)	If the number of eligible SKUs for a given SKU parent/store/week is above this threshold, it is considered eligible.

Overrides Worksheet

The Overrides worksheet enables the user to override certain measures.

After all necessary overrides have been performed, you should execute preprocessing by selecting the Preprocessing option from the Planning Actions menu. When preprocessing is completed, a success dialog is displayed. You can then continue to the Preprocessing Results tab to view the preprocessing results.

Note:

In order to specify an override for SKU parent eligibility criteria, aggregate the view to SKU parent (or style/color level).

Figure 3-9 Overrides Worksheet

The following table describes the measures available on this worksheet.

Table 3-4 Override Worksheet Measures

Measure	Description
Default History Start Date Override	Used to override the history start date for the preprocessing window.
Default History End Date Override	Used to override the history end date for the preprocessing window.
Default Season Start Date Override	Season start date used specifically for this item and will override the default dates set up at higher levels.
Default Season End Date Override	Season end date used specifically for this item and will override the default dates set up at higher levels.
Sales Unit Threshold Override (Start/End Date)	The first and last date of history where sales units for the SKU/Store exceed this threshold are used in the season length calculation.
Maximum Inventory Percentage Threshold Override (Start/End Date)	The first and last date of history where ratio of sales plus inventory to maximum inventory for the SKU/Store exceed this threshold are used in the Season length calculation.
Inventory Unit Threshold Override (Start/End Date)	The first and last date of history where the inventory for the SKU/Store needs to exceed this inventory units threshold are used in the Season length calculation.
Sales Unit Threshold Override (SKU/Store/Week Eligibility)	The SKU/store/week is considered eligible for size profile generation only if, the sales units for a given week, for that SKU/store need to exceed this sales unit threshold override value.
Max Inventory Percentage Threshold Override (SKU/Store/Week Eligibility)	The SKU/store/week is considered eligible only if its inventory expressed as a percentage of the maximum inventory for the SKU/store is greater than the max inventory percentage threshold specified.
Sales plus Inventory Unit Threshold Override (SKU/Store/Week Eligibility)	The SKU/store/week is considered eligible for size profile generation only if, the value of the sum of sales and inventory of a given week, for that SKU/store need to exceed this Sales plus Inventory Unit Threshold value.
Eligible Weeks Percentage Threshold Override (SKU/Store Eligibility)	A SKU/store is considered eligible if the ratio of its eligible weeks to its season length exceeds this threshold.
Total Sales Threshold Override (SKU/Store Eligibility)	Used in the SKU/store eligibility check, if the total sales for a SKU/store exceeds this threshold, then it is considered eligible.
Season Length Threshold Override (SKU/Store Eligibility)	A SKU/store is considered eligible if its season length calculated is above this threshold.
Eligible SKU's Percentage Threshold Override - Optimized (SKU Parent/Store/Week Eligibility)	If the total number of eligible SKUs for a given SKU parent/store/week expressed as a percentage of total SKUs exceeds the threshold, then the SKU parent/store/week is considered eligible.
Eligible SKU's Threshold Override - Optimized (SKU Parent/Store/Week Eligibility)	If the number of eligible SKUs for a given SKU parent/store/week is above this threshold, it is considered eligible. This is for the optimized generation method.
SKU-Parent/Store Eligible Weeks Threshold Override (SKU Parent/Store Eligibility)	Used in SKU parent/store eligible calculation. Minimum number of weeks required for the SKU Parent / Store to be considered eligible.
Total Sales Threshold Override (SKU Parent/Store Eligibility)	Used in the SKU parent/store eligibility check. If the total sales for a SKU parent/store exceeds this threshold, then it is considered eligible.
Eligible SKU's Threshold Override - Normalized (SKU Parent/Store Eligibility	If the number of eligible SKUs for a given SKU parent/store exceeds this threshold, the SKU parent/store is considered eligible for normalized generation method.
Eligible SKU's Percentage Threshold Override - Normalized (SKU Parent/Store/Week Eligibility)	If the total number of eligible SKUs for a given SKU parent/store/week expressed as a percentage of total SKUs exceeds the threshold, then the SKU parent/store/week is considered eligible for normalized generation method.
Eligible SKU's Threshold Override (SKU Parent/Store Eligibility)	If the number of eligible SKUs for a given SKU parent/store/week is above this threshold, it is considered eligible.

Preprocessing Results Tab

The following section describes the Preprocessing Results worksheet available under the Preprocessing Results tab.

Preprocessing Results Worksheet

The Preprocessing Results worksheet displays the preprocessing results.

Figure 3-10 Preprocessing Results Worksheet

On the Preprocessing Results worksheet, you can review the product/location level preprocessing results by aggregating data along the calendar hierarchy or other hierarchies as necessary.

In this screenshot, you can see that there was no sales for week1, therefore that week was pruned for the purpose of size profile generation, for both the optimized and normalized methods.

When reviewing the impact of preprocessing on weekly data, you can compare actual sales to filtered or preprocessed sales and actual inventory to validate the results of preprocessing. You may find it helpful to view these results in graph mode. For more information on the graph mode, see the "Graph View" section in Chapter 1.

Figure 3-11 Preprocessing Results Worksheet Viewed as a Graph

The following table describes the measures available on this worksheet.

Table 3-5 Preprocessing Results Worksheet Measures

Measure	Description
Filtered Sales for Optimized Size Profile	Filtered sales after applying preprocessing criteria for the optimized size profile generation method.
Pruned for Optimized Size Profile	Indicates if a the SKU/store/week data point was considered eligible from the preprocessing run after applying preprocessing criteria for optimized size profile generation.
Filtered Sales for Normalized Size Profile	Filtered sales after applying preprocessing criteria for the normalized size profile generation method.
Pruned for Normalized Size Profile	Indicates if a the SKU/store/week data point was considered eligible from the preprocessing run after applying preprocessing criteria for normalized size profile generation.
Raw Sales	Raw, unfiltered historic sales data.
End of Period Inventory	Raw, unfiltered historic inventory data.

Preprocessing Summary Statistics Tab

The following sections describe the worksheets available under the Preprocessing Summary Statistics tab:

Preprocessing Summary Worksheet
Preprocessing Summary Statistics- Style Worksheet

Preprocessing Summary Worksheet

The Preprocessing Summary worksheet allows you to view the filtered and alerted sales for both normalized and optimized size profiles.

Figure 3-12 Preprocessing Summary: Default Profile

The following table describes the measures available on this worksheet.

Table 3-6 Preprocessing Summary Worksheet Measures

Measure	Description
05) Total Sales within User Defined Period	The total sales within user specified start/end date
Filtered Sales for Optimized Size Profile	Filtered sales after applying preprocessing criteria for the optimized size profile generation method
Total Eligible SKUs for Optimized Size Profile	Total eligible SKUs after applying preprocessing criteria for size profile generation using the optimized method.
Total Eligible Styles for Optimized Size Profile	Total eligible styles after applying preprocessing criteria for size profile generation using the optimized method.
Total Alerted SKUs/Store for Optimized Size Profile	Total alerted SKU/stores after applying preprocessing criteria for size profile generation using the optimized method.
Total Alerted SKUS for Optimized Size Profile	Total alerted SKUs after applying preprocessing criteria for size profile generation using the optimized method.
Total Alerted Styles for Optimized Size Profile	Total alerted styles after applying preprocessing criteria for size profile generation using the optimized method.
Total Unfiltered SKU's/Store	Total unfiltered SKU/store count.
Total Unfiltered SKU's	Total unfiltered SKU count.
Total Unfiltered Styles	Total unfiltered style count.

Measure Profiles

A measure profile allows you to view only certain measures within the worksheet. The Preprocessing Summary worksheet has three measure profiles. The three measure profiles are as follows:

Default: This profile displays default measures in the worksheet.
Normalized Size Profile: In this profile, only the measures relevant for size profile generation using the normalized method are displayed. The measures displayed are:
- Filtered Sales for Normalized Size Profile
- Total Unfiltered SKU/Store
- Total Alerted SKU/Store for Normalized Size Profile
- Total Alerted Style/Store for Normalized Size Profile
- Total Unfiltered SKUs
- Total Eligible SKUs for Normalized Size Profile
- Total Alerted SKUs for Normalized Size Profile
Optimized Size Profile: In this profile, only the measures relevant for size profile generation using the optimized method are displayed. The measures displayed are:
- Filtered Sales for Optimized Size Profile
- Total Unfiltered SKUs/Store
- Total Eligible SKUs/Store for Optimized Size Profile
- Total Alerted SKUs/Store for Optimized Size Profile
- Total Unfiltered SKUs
- Total Eligible SKUs for Optimized Size Profile
- Total Alerted SKUs for Optimized Size Profile

Preprocessing Summary Statistics- Style Worksheet

The Preprocessing Summary Statistics- Style worksheet displays the unfiltered, alerted, and eligible styles for both normalized and optimized size profile.

Figure 3-13 Preprocessing Summary Statistics - Style: Default Measure Profile

The following table describes the measures available on this worksheet.

Table 3-7 Preprocessing Summary Statistics- Style Worksheet Measures

Measure	Description
Total Eligible Styles for Normalized Size Profile	Displays the number of eligible styles for size profile generation using the normalized method.
Total Alerted Styles for Normalized Size Profile	Displays the number of alerted styles for size profile generation using the normalized method.
Total Alerted Styles for Optimized Size Profile	Displays the number of alerted styles for size profile generation using the optimized method.
Total Eligible Styles for Optimized Size Profile	Displays the number of eligible styles for size profile generation using the optimized method.
Total Unfiltered Styles	Total number of unfiltered style count.

The Preprocessing Summary Statistics- Style step has three measure profiles as given below:

Default: The default profile displays all the measures in the worksheet.
Normalized Size Profile: In this view, the following measures are displayed:
- Total Unfiltered Styles
- Total Alerted Styles for Normalized Size Profile
- Total Eligible Styles for Normalized Size Profile
Optimized Size Profile: In this profile, the following measures are displayed:
- Total Unfiltered Styles
- Total Alerted Styles for Optimized Size Profile
- Total Eligible Styles for Optimized Size Profile