Posted in Operations and Supply Chain Terms, Total Reads: 76
Definition: Trend Forecasting Models
Trend Forecasting Models are basically statistical models which are built according to the historical data for any particular KPI in the organization. The historical trends are studied and seasonality is noticed and using the data present, it is extrapolated to predict the future numbers of the same KPI being measured. This is a very useful tool and all companies use this particularly for demand estimation.
Having an insight on the predicted demand helps organizations plan better and schedule for the upcoming tasks. These models serve as the reference on which all future transactions are based. Forecasting helps the business be better prepared. These models are circulated internally to all people who would require future data in order to work on their daily functions. Trend Forecasting Models are very useful in the organization.
For example: Historical data of Sales helps the company predict the future sales for the upcoming year also accounting for all peak and off seasons. This data helps the organization in procurement and planning. These models are built by the Business Analytics team to provide better insights to the partners in the Marketing & Operations team.