From the course: Supply Chain Foundations: Analytics

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Predictive analytics for forecasting

Predictive analytics for forecasting

From the course: Supply Chain Foundations: Analytics

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Predictive analytics for forecasting

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- Predictive analytics. These are analytics that reveal to supply chain professionals what will happen next. Remember, descriptive analytics tools told us what happened, hindsight. Diagnostic analytics, why that happened, insight. Predictive analytics are looking into the future to provide foresight. Predictive analytics will hopefully help us make good decisions in the future and also help us avoid past mistakes. For example, descriptive analytics told us we had stockouts of sports energy drinks in 2019. Diagnostic analytics told us that this correlated with weather patterns five degrees above normal and increases in citric acid prices. So now we know what we're looking for, hot weather and high prices. Using historical data and real-time data, we can use predictive analytics models to forecast both the weather and citric acid prices. Our demand and operations teams will monitor these evolving and ever-changing…

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