| # Smoothing factor One of the two methods to calculate the overall vendor ratings is Smoothing Factor. If the method is Smoothing Factor, in the Smoothing Factor field of the Vendor Rating Parameters (tdpur0100m800) session, you must specify the factor. LN calculates the overall vendor rating for each business partner as follows:

    New overall vendor rating =
    ((OR * OV * (1 - F)) + (PR * NV * F)) / ((OV * (1 - F)) + (NV * F))
    ORThe existing overall vendor rating of the business partner.OVThe value on which the old rating was based.NVThe total value of the period. The value type is retrieved
    from the Weighting Method field in the Vendor Rating Parameters (tdpur0100m800) session.FSmoothing factor that is specified in the Vendor Rating Parameters (tdpur0100m800) session.PRThe vendor rating for the newest business partner/period combination.
Example The existing overall vendor rating is 70%. The old value on which the existing rating is based is 8000 pieces. The Smoothing Factor is 0.8. The new value for the new period is 1000 pieces. The period rating calculated for the newest period is 85%. New overall vendor rating:
    ((70 * 8000 * (1 - 0.8)) + (85 * 1000 * 0.8)) / ((8000 * (1 - 0.8)) + (1000 * 0.8)) = 75%
Related topics Updating overall vendor rating Moving average Calculating vendor ratings Overview of vendor rating |