• Need & Importance of Forecasting

•Qualitative Methods of Forecasting

•Quantitative Methods of Forecasting
Need & Importance Of Forecasting
What is Forecasting?
 Process of predicting
a future event ??
 Underlying basis of
all business
decisions
 Production
 Inventory
 Personnel
 Facilities
 Forecasting
• Forecasting may involve taking historical data
and projecting them into the future with some
mathematical model or it may be a subjective or
intuitive prediction.
• Forecasts are seldom perfect and there’s no
superior method for all organizations. They are
also costly and time consuming to prepare.
• Few businesses, however can afford to avoid
the process of forecasting by just waiting and
taking their chances
 Forecasting Time Horizons
 Short-range forecast
 Up to 1 year, generally less than 3 months
 Purchasing, job scheduling, workforce levels,
job assignments, production levels

 Medium-range forecast
 3 months to 3 years
 Sales and production planning, budgeting

 Long-range forecast
 3+ years
 New product planning, facility location, research
and development
 Distinguishing Differences
 Medium/long range
Forecasts deal with more comprehensive
issues and support management decisions
regarding planning and products, plants and
processes
 Short-term
1. forecasting usually employs different
methodologies than longer-term forecasting
2. forecasts tend to be more accurate than
longer-term forecasts
 Influence of Product Life Cycle

Introduction – Growth – Maturity – Decline

 Introduction and growth require longer

forecasts than maturity and decline
 As product passes through life cycle,
forecasts are useful in projecting
 Staffing levels
 Inventory levels
 Factory capacity
 Types of Forecasts
 Economic forecasts are planning indicators
 Address business cycle – inflation rate, money
supply, housing starts, etc.

 Technological forecasts are long-term forecasts

 Predict rate of technological progress
 Impacts development of new products

 Demand forecasts are projections of a company’s

sales
 Predict sales of existing product
 Human Resources – Hiring, training, laying off workers
depend on anticipated demand
 Capacity – Capacity shortages can result in undependable
delivery, loss of customers, loss of market share
 Supply-Chain Management – Good supplier relations and
price advantages for materials and parts depend on
accurate forecasts
 Good forecasts are of critical importance in all aspects of a
business.
 The forecast is the only estimate of demand until actual
demand becomes known.
 Forecasts of demand therefore drive decisions in many
areas
 Seven Steps in Forecasting
 Determine the use of the forecast and select
the items to be forecasted
 Select the indicators relevant to the need
sales, population projection, income levels,
economic development, competitors present
and projected capacity
 Determine the time horizon of the forecast
 Select the forecasting model(s)
 Gather the data
 Make the forecast
 Validate and implement results
 Forecasts are seldom perfect
 Most techniques assume an
underlying stability in the system
 Product family and aggregated
forecasts are more accurate than
individual product forecasts
 Forecasting Approaches
Qualitative Methods
 Used when situation is vague, there is high
level of uncertainty and where little data exist
 New products
 New technology
 Times of Economic and political upheaval

 Involves intuition, experience

 e.g., forecasting sales on Internet
 Overview of Qualitative Methods
 Jury of executive opinion
 Pool opinions of high-level executives,
sometimes augment by statistical
models
 Delphi method
 Panel of experts, queried iteratively
 Overview of Qualitative Methods
 Sales force composite
 Estimates from individual salespersons
are reviewed for reasonableness, then
aggregated
 Consumer Market Survey
 Ask the customer
 Jury of Executive Opinion
 Involves small group of high-level managers
 Group estimates demand by working
together
 Combines managerial experience with
statistical models
 Relatively quick
 ‘Group-think’
disadvantage
 Sales Force Composite
 Each salesperson projects his or her
sales
 Combined at district and national
levels
 Sales reps know customers’ wants
 Tends to be overly optimistic
 Delphi Method
 Iterative group Decision Makers
(Evaluate responses and
process, continues make decisions)

until consensus is
reached
 3 types of Staff
(Administering
participants survey)
 Decision makers
 Staff
 Respondents Respondents
(People who can make
valuable judgments)
 Consumer Market Survey

 Ask customers about purchasing

plans
 What consumers say, and what they
actually do are often different
 Sometimes difficult to answer
 Forecasting Approaches
Quantitative Methods
 Used when situation is ‘stable’ and
historical data exist
 Existing products
 Current technology
 Involves mathematical techniques
 e.g., forecasting sales of color
televisions
 Overview of Quantitative
Approaches
1. Naive approach
2. Moving averages
Time-Series
3. Exponential Models
smoothing
4. Trend projection
Associative
5. Linear regression Model
 Time Series Forecasting

 Set of evenly spaced numerical data

 Obtained by observing response variable at
regular time periods

 Forecast based only on past values

 Assumes that factors influencing past and
present will continue influence in future
Time Series Components

Trend Cyclical

Seasonal Random
 Trend
component
Demand for product or service

Seasonal peaks

Actual
demand

Average
demand over
Random four years
variation
| | | |
1 2 3 4
Year Figure 4.1
 Trend Component
 Persistent, overall upward or
downward pattern
 Changes due to population,
technology, age, culture, etc.
 Typically several years duration
 Seasonal Component
 Regular pattern of up and down
fluctuations
 Due to weather, customs, etc.
 Occurs within a single year
Number of
Period Length Seasons
Week Day 7
Month Week 4-4.5
Month Day 28-31
Year Quarter 4
Year Month 12
Year Week 52
 Cyclical Component
 Repeating up and down movements
 Affected by business cycle, political,
and economic factors
 Multiple years duration
 Often causal or
associative
relationships

0 5 10 15 20
 Random Component
 Erratic, unsystematic, ‘residual’
fluctuations
 Due to random variation or
unforeseen events
 Short duration and
nonrepeating

M T W T F
 Naive Approach
 Assumes demand in next period is
the same as demand in most recent
period
 e.g., If May sales were 48, then June
sales will be 48
 Sometimes cost effective and
efficient
 Moving Average Method

 MA is a series of arithmetic means

 Used if little or no trend
 Used often for smoothing
 Provides overall impression of data
over time

∑ demand in previous n
Moving average =
periods
n
 Actual 3-Month
Month Shed Sales Moving Average

January 10
February 12
March 13
April 16 (10 + 12 + 13)/3 = 11 2/3
May 19 (12 + 13 + 16)/3 = 13 2/3
June 23 (13 + 16 + 19)/3 = 16
July 26 (16 + 19 + 23)/3 = 19 1/3
 Potential Problems With
Moving Average
 Increasing n smoothes the
forecast but makes it less
sensitive to changes
 Do not forecast trends well
 Require extensive historical data
 Moving Average And
Weighted Moving Average
Weighted
moving
30 – average
25 –
Sales demand

20 – Actual
sales
15 –
Moving
10 – average

5 –
| | | | | | | | | | | |
Figure 4.2
J F M A M J J A S O N D
 Exponential Smoothing
 Form of weighted moving average
 Weights decline exponentially
 Most recent data weighted most
 Requires smoothing constant ()
 Ranges from 0 to 1
 Subjectively chosen
 Involves little record keeping of past data
 Exponential Smoothing
New forecast = last period’s
forecast
+  (last period’s actual demand
– last period’s
Ft = Ft – 1 + (At – 1 - Ft – 1)
forecast)
where Ft = new forecast
Ft – 1 = previous forecast
 = smoothing (or weighting)
constant (0    1)
Exponential Smoothing Example
Predicted demand = 142 Ford Mustangs
Actual demand = 153
Smoothing constant  = .20
Exponential Smoothing Example
Predicted demand = 142 Ford Mustangs
Actual demand = 153
Smoothing constant  = .20

New forecast = 142 + .2(153 – 142)

Exponential Smoothing Example
Predicted demand = 142 Ford Mustangs
Actual demand = 153
Smoothing constant  = .20

New forecast = 142 + .2(153 – 142)

= 142 + 2.2
= 144.2 ≈ 144 cars
 Effect of
Smoothing Constants

Weight Assigned to
Most 2nd Most 3rd Most 4th Most 5th Most
Recent Recent Recent Recent Recent
Smoothing Period Period Period Period Period
Constant () (1 - ) (1 - )2 (1 - )3 (1 - )4

 = .1 .1 .09 .081 .073 .066

 = .5 .5 .25 .125 .063 .031

 225 –
Actual  = .5
demand
200 –
Demand

175 –
 = .1
| | | | | | | | |
150 –
1 2 3 4 5 6 7 8 9
Quarter
 Choosing 
The objective is to obtain the most
accurate forecast no matter the
technique
We generally do this by selecting the
model that gives us the lowest forecast
error

Forecast error = Actual demand - Forecast value

= At - F t
Mean Absolute Deviation (MAD)
∑ |actual - forecast|
MAD =
n

Mean Squared Error (MSE)

∑ (forecast errors)2
MSE =
n
Mean Absolute Percent Error (MAPE)

n
100 ∑ |actuali - forecasti|/actuali
MAPE = i=1
n
 Rounded Absolute Rounded Absolute
Actual Forecast Deviation Forecast Deviation
Tonnage with for with for
Quarter Unloaded  = .10  = .10  = .50  = .50
1 180 175 5 175 5
2 168 176 8 178 10
3 159 175 16 173 14
4 175 173 2 166 9
5 190 173 17 170 20
6 205 175 30 180 25
7 180 178 2 193 13
8 182 178 4 186 4
84 100
 ∑ |deviations|
Rounded Absolute Rounded Absolute
MADActual
= Forecast Deviation Forecast Deviation
Tonage n
with for with for
Quarter Unloaded  = .10  = .10  = .50  = .50
1 For  180
= .10 175 5 175 5
2 168 176 8 178 10
3 159
= 84/8 =
175
10.50 16 173 14
4 For 175
= .50 173 2 166 9
5 190 173 17 170 20
6 205 = 100/8
175 = 12.50
30 180 25
7 180 178 2 193 13
8 182 178 4 186 4
84 100
 ∑ (forecast
Rounded
errors) 2
Absolute Rounded Absolute
MSE = Actual Forecast Deviation Forecast Deviation
Tonage n
with for with for
Quarter Unloaded  = .10  = .10  = .50  = .50
1
For  =
180
.10 175 5 175 5
2 = 1,558/8
168 = 194.758
176 178 10
3 159 175 16 173 14
4 For 175
= .50 173 2 166 9
5 190 173 17 170 20
6 = 1,612/8
205 =
175 201.5030 180 25
7 180 178 2 193 13
8 182 178 4 186 4
84 100
MAD 10.50 12.50
 n
100 ∑ |deviation
Rounded i|/actual
Absolute Rounded
i Absolute
MAPE =Actual i = Forecast
1 Deviation Forecast Deviation
Tonage with for with for
Quarter Unloaded  = .10 n  = .10  = .50  = .50
1
For 180
 = .10 175 5 175 5
2 168 = 45.62/8
176 = 5.70%
8 178 10
3 159 175 16 173 14
4 For =
175 .50 173 2 166 9
5 190 173 17 170 20
6 205 = 54.8/8
175 = 6.85%
30 180 25
7 180 178 2 193 13
8 182 178 4 186 4
84 100
MAD 10.50 12.50
MSE 194.75 201.50
 Rounded Absolute Rounded Absolute
Actual Forecast Deviation Forecast Deviation
Tonnage with for with for
Quarter Unloaded  = .10  = .10  = .50  = .50
1 180 175 5 175 5
2 168 176 8 178 10
3 159 175 16 173 14
4 175 173 2 166 9
5 190 173 17 170 20
6 205 175 30 180 25
7 180 178 2 193 13
8 182 178 4 186 4
84 100
MAD 10.50 12.50
MSE 194.75 201.50
MAPE 5.70% 6.85%
 Exponential Smoothing with
Trend Adjustment
When a trend is present, exponential
smoothing must be modified

Forecast exponentially exponentially

including (FITt) = smoothed (Ft) + (Tt) smoothed
trend forecast trend
Exponential Smoothing with
Trend Adjustment

Ft = (At - 1) + (1 - )(Ft - 1 + Tt - 1)

Tt = (Ft - Ft - 1) + (1 - )Tt - 1

Step 1: Compute Ft
Step 2: Compute Tt
Step 3: Calculate the forecast FITt = Ft + Tt
 Exponential Smoothing with Trend
Adjustment Example
Forecast
Actual Smoothed Smoothed Including
Month(t) Demand (At) Forecast, Ft Trend, Tt Trend, FITt
1 12 11 2 13.00
2 17
3 20
4 19
5 24
6 21
7 31
8 28
9 36
10
Table 4.1
Exponential Smoothing with Trend
Adjustment Example
Forecast
Actual Smoothed Smoothed Including
Month(t) Demand (At) Forecast, Ft Trend, Tt Trend, FITt
1 12 11 2 13.00
2 17
3 20
4 19
Step 1: Forecast for Month 2
5 24
6 21
F2 = A1 + (1 - )(F1 + T1)
7 31
8 28 F2 = (.2)(12) + (1 - .2)(11 + 2)
9 36 = 2.4 + 10.4 = 12.8 units
10
 Exponential Smoothing with Trend
Adjustment Example
Forecast
Actual Smoothed Smoothed Including
Month(t) Demand (At) Forecast, Ft Trend, Tt Trend, FITt
1 12 11 2 13.00
2 17 12.80
3 20
4 19
Step 2: Trend for Month 2
5 24
6 21
T2 = (F2 - F1) + (1 - )T1
7 31
8 28 T2 = (.4)(12.8 - 11) + (1 - .4)(2)
9 36 = .72 + 1.2 = 1.92 units
10
Table 4.1
 Exponential Smoothing with
Trend Adjustment Example
Forecast
Actual Smoothed Smoothed Including
Month(t) Demand (At) Forecast, Ft Trend, Tt Trend, FITt
1 12 11 2 13.00
2 17 12.80 1.92
3 20
4 19
Step 3: Calculate FIT for Month 2
5 24
6 21
FIT2 = F 2 + T1
7 31
8 28 FIT2 = 12.8 + 1.92
9 36 = 14.72 units
10
Table 4.1
 Exponential Smoothing with
Trend Adjustment Example
Forecast
Actual Smoothed Smoothed Including
Month(t) Demand (At) Forecast, Ft Trend, Tt Trend, FITt
1 12 11 2 13.00
2 17 12.80 1.92 14.72
3 20 15.18 2.10 17.28
4 19 17.82 2.32 20.14
5 24 19.91 2.23 22.14
6 21 22.51 2.38 24.89
7 31 24.11 2.07 26.18
8 28 27.14 2.45 29.59
9 36 29.28 2.32 31.60
10 32.48 2.68 35.16
Table 4.1
 Exponential Smoothing with
Trend Adjustment Example
35 –
Actual demand (At)
30 –
Product demand

25 –

20 –

15 –

10 –
Forecast including trend (FITt)

5 –

0 – | | | | | | | | |
1 2 3 4 5 6 7 8 9
Figure 4.3
Time (month)
 Trend Projections
Fitting a trend line to historical data points to
project into the medium-to-long-range
Linear trends can be found using the least
squares technique
^
y = a + bx
^
where y= computed value of the variable to be
predicted (dependent variable)
a= y-axis intercept
b= slope of the regression line
x= the independent variable
Values of Dependent Variable Least Squares Method
Actual observation Deviation7
(y value)

Deviation5 Deviation6

Deviation3

Deviation4

Deviation1
Deviation2
Trend line, y^ = a + bx

Time period Figure 4.4

Values of Dependent Variable Least Squares Method
Actual observation Deviation7
(y value)

Deviation5 Deviation6

Deviation3
Least squares method minimizes the
sum of the squared errors
(deviations)
Deviation4

Deviation1
Deviation2
Trend line, y^ = a + bx

Time period Figure 4.4

 Least Squares Method
Equations to calculate the regression
variables
^
y = a + bx

xy - nxy
b=
x2 - nx2

a = y - bx
 Least Squares Example
Time Electrical Power
Year Period (x) Demand x2 xy
1999 1 74 1 74
2000 2 79 4 158
2001 3 80 9 240
2002 4 90 16 360
2003 5 105 25 525
2004 6 142 36 852
2005 7 122 49 854
∑x = 28 ∑y = 692 ∑x2 = 140 ∑xy = 3,063
x=4 y = 98.86

∑xy - nxy 3,063 - (7)(4)(98.86)

b= = = 10.54
∑x - nx
2 2 140 - (7)(4 )
2

a = y - bx = 98.86 - 10.54(4) = 56.70

 Least Squares Example
Time Electrical Power
Year Period (x) Demand x2 xy
1999 1 74 1 74
2000 2 79 4 158
2001 3 80 9 240
2002 4 90 16 360
2003 5 105 25 525
2004 6 142 36 852
2005 7 122 49 854
x = 28 y = 692 x2 = 140 xy = 3,063
x=4 y = 98.86

xy - nxy 3,063 - (7)(4)(98.86)

b= = = 10.54
x - nx
2 2 140 - (7)(4 )
2

a = y - bx = 98.86 - 10.54(4) = 56.70

 Least Squares Example
Trend line,
160 – ^ y = 56.70 + 10.54x
150 –
140 –
Power demand

130 –
120 –
110 –
100 –
90 –
80 –
70 –
60 –
50 –
| | | | | | | | |
1999 2000 2001 2002 2003 2004 2005 2006 2007
Year
 Seasonal Variations In Data
The multiplicative seasonal model can
modify trend data to accommodate
seasonal variations in demand

1. Find average historical demand for each season

2. Compute the average demand over all seasons
3. Compute a seasonal index for each season
4. Estimate next year’s total demand
5. Divide this estimate of total demand by the number
of seasons, then multiply it by the seasonal index for
that season
 Demand Average Average Seasonal
Month 2003 2004 2005 2003-2005 Monthly Index
Jan 80 85 105 90 94
Feb 70 85 85 80 94
Mar 80 93 82 85 94
Apr 90 95 115 100 94
May 113 125 131 123 94
Jun 110 115 120 115 94
Jul 100 102 113 105 94
Aug 88 102 110 100 94
Sept 85 90 95 90 94
Oct 77 78 85 80 94
Nov 75 72 83 80 94
Dec 82 78 80 80 94
 Demand Average Average Seasonal
Month 2003 2004 2005 2003-2005 Monthly Index
Jan 80 85 105 90 94 0.957
Feb 70 85 85 80 94
Mar 80 93 82 85 94
Apr 90 95 115 100 94
May 113 125 131 123 94
Jun 110 115 120 115 94
Jul 100 102 113 105 94
Aug 88 102 110 100 94
Sept 85 90 95 90 94
Oct 77 78 85 80 94
Nov 75 72 83 80 94
Dec 82 78 80 80 94
 Demand Average Average Seasonal
Month 2003 2004 2005 2003-2005 Monthly Index
Jan 80 85 105 90 94 0.957
Feb 70 85 85 80 94 0.851
Mar 80 93 82 85 94 0.904
Apr 90 95 115 100 94 1.064
May 113 125 131 123 94 1.309
Jun 110 115 120 115 94 1.223
Jul 100 102 113 105 94 1.117
Aug 88 102 110 100 94 1.064
Sept 85 90 95 90 94 0.957
Oct 77 78 85 80 94 0.851
Nov 75 72 83 80 94 0.851
Dec 82 78 80 80 94 0.851
 Demand Average Average Seasonal
Month 2003 2004 2005 2003-2005 Monthly Index
Jan 80 85 105 90 94 0.957
Feb 70 85 Forecast
85 for 2006
80 94 0.851
Mar 80 93 82 85 94 0.904
Apr 90Expected
95 annual
115 demand100 = 1,200
94 1.064
May 113 125 131 123 94 1.309
Jun 110 115Jan 120 1,200 x115 .957 = 96 94 1.223
Jul 100 102 113 12 105 94 1.117
Aug 88 102 110 100 94 1.064
1,200
Sept 85 90
Feb 95 x90
.851 = 85 94 0.957
12
Oct 77 78 85 80 94 0.851
Nov 75 72 83 80 94 0.851
Dec 82 78 80 80 94 0.851
 2006 Forecast
140 – 2005 Demand
130 – 2004 Demand
2003 Demand
120 –
Demand

110 –
100 –
90 –
80 –
70 –
| | | | | | | | | | | |
J F M A M J J A S O N D
Time
 San Diego Hospital
Trend Data

10,200 –

10,000 –
Inpatient Days

9745
9,800 – 9702
9616 9659
9573 9723 9766
9,600 – 9530 9680
9594 9637
9551
9,400 –

9,200 –
| | | | | | | | | | | |
9,000 –
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
67 68 69 70 71 72 73 74 75 76 77 78
Month
Figure 4.6
 San Diego Hospital
Seasonal Indices

1.06 –
1.04 1.04
Index for Inpatient Days

1.04 – 1.03
1.02
1.02 – 1.01
1.00
1.00 – 0.99
0.98
0.98 – 0.99
0.96 – 0.97 0.97
0.96
0.94 –
| | | | | | | | | | | |
0.92 –
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
67 68 69 70 71 72 73 74 75 76 77 78
Month
Figure 4.7
 San Diego Hospital
Combined Trend and Seasonal Forecast

10,200 – 10068
9949
10,000 – 9911
Inpatient Days

9764 9724
9,800 – 9691
9572
9,600 –
9520 9542
9,400 –
9411
9265 9355
9,200 –
| | | | | | | | | | | |
9,000 –
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
67 68 69 70 71 72 73 74 75 76 77 78
Month
Figure 4.8
Used when changes in one or more independent
variables can be used to predict the changes in
the dependent variable

Most common technique is linear

regression analysis

We apply this technique just as we did in

the time series example
 Associative Forecasting
Forecasting an outcome based on predictor
variables using the least squares technique

^
y = a + bx
^ where y= computed value of the variable to be
predicted (dependent variable)
a= y-axis intercept
b= slope of the regression line
x= the independent variable though to predict the
value of the dependent variable
 Sales Local Payroll
($000,000), y ($000,000,000), x
2.0 1
3.0 3
2.5 4
4.0 –
2.0 2
2.0 1
3.0 –
3.5 7 Sales
2.0 –

1.0 –
| | | | | | |
0 1 2 3 4 5 6 7
Area payroll
 Sales, y Payroll, x x2 xy
2.0 1 1 2.0
3.0 3 9 9.0
2.5 4 16 10.0
2.0 2 4 4.0
2.0 1 1 2.0
3.5 7 49 24.5
∑y = 15.0 ∑x = 18 ∑x2 = 80 ∑x y = 51.5

51.5 - (6)(3)(2.5)
x = ∑x/6 = 18/6 = 3 b∑=
xy - nxy = = .25
∑x2 - nx2 80 - (6)(3 )
2

y = ∑y/6 = 15/6 = 2.5 a = y - bx = 2.5 - (.25)(3) = 1.75

 ^
y = 1.75 + .25x Sales = 1.75 + .25(payroll)

If payroll next year is

estimated to be $600 4.0 –
million, then:
3.25
3.0 –
Sales

Sales = 1.75 + .25(6) 2.0 –

Sales = $325,000
1.0 –
| | | | | | |
0 1 2 3 4 5 6 7
Area payroll
 Correlation
 How strong is the linear
relationship between the
variables?
 Correlation does not necessarily
imply causality!
 Coefficient of correlation, r,
measures degree of association
 Values range from -1 to +1
 Correlation Coefficient
n∑xy - ∑x∑y
r=
[n∑x2 - (∑x)2][n∑y2 - (∑y)2]
 Correlation
 Coefficient of Determination, r2,
measures the percent of change
in y predicted by the change in x
 Values range from 0 to 1
 Easy to interpret
 Monitoring and Controlling
Forecasts
Tracking Signal
 Measures how well the forecast is
predicting actual values
 Ratio of running sum of forecast errors
(RSFE) to mean absolute deviation
(MAD)
 Good tracking signal has low values
 If forecasts are continually high or low, the
forecast has a bias error
 Monitoring and Controlling
Forecasts

Tracking RSFE
signal =
MAD

∑(actual demand in
period i -
forecast demand
Tracking in period i)
signal =
∑|actual - forecast|/n)
 Tracking Signal
Signal exceeding limit
Tracking signal
Upper control limit
+

Acceptable
0 MADs range

– Lower control limit

Time
 Tracking Signal Example
Cumulative
Absolute Absolute
Actual Forecast Forecast Forecast
Qtr Demand Demand Error RSFE Error Error MAD
1 90 100 -10 -10 10 10 10.0
2 95 100 -5 -15 5 15 7.5
3 115 100 +15 0 15 30 10.0
4 100 110 -10 -10 10 40 10.0
5 125 110 +15 +5 15 55 11.0
6 140 110 +30 +35 30 85 14.2
 Tracking Signal Example

Cumulative
Absolute Absolute
Actual Forecast Forecast Forecast
Qtr Demand Demand Error RSFE Error Error MAD
1 90 100 -10 -10 10 10 10.0
2 95 100 -5 -15 5 15 7.5
3 115 100 +15 0 15 30 10.0
4 100 110 -10 -10 10 40 10.0
5 125 110 +15 +5 15 55 11.0
6 140 110 +30 +35 30 85 14.2

The variation of the tracking signal between -2.0 and +2.5 is

within acceptable limits