Predict Tomorrow’s Demand Using Yesterday’s Data

Good day Medium readers!

At this time, 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 knowledge science. Just lately, I’ve been studying up on this subject, revisiting books and articles on demand forecasting to offer 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 unsuitable, however some are helpful.”

As you replicate on this quote, you would possibly marvel: why even trouble forecasting the long run if no mannequin can ever be totally correct? Consider it like climate forecasting: it helps us plan forward. Ought to I convey 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 choices.

In demand planning, it’s no completely different. Demand planners and different firm stakeholders use forecasts to anticipate future wants and modify…