Whereas AI fashions have taken the highlight, conventional statistical fashions stay extremely precious instruments for demand forecasting
Whats up Medium readers!
At the moment, we’ll dive into forecasting methods utilized to demand planning, a area that I’m extremely invested in because of my provide chain background and fervour for information science. Lately, I’ve been studying up on this subject, revisiting books and articles on demand forecasting to give you some contemporary insights.
To kick issues off, let me share a thought-provoking quote by British statistician George E. P. Field:
“All fashions are incorrect, however some are helpful.”
As you replicate on this quote, you may surprise: why even trouble forecasting the long run if no mannequin can ever be solely correct? Consider it like climate forecasting: it helps us plan forward. Ought to I carry an umbrella tomorrow? Ought to I placed on sunscreen? Ought to I take shelter from a hurricane? Forecasts, whereas imperfect, information us in making higher selections.
In demand planning, it’s no totally different. Demand planners and different firm stakeholders use forecasts to anticipate future wants and regulate…
