There are a lot of metrics which are forecasted in sales and finance. Warehouse operations has traditionally had their own stock level calculations to minimize inventory. Other areas of the business do their own predictions for the future too.
Most of the time forecasting is done in spreadsheets. Sometimes with use of some basic spreadsheet statistical formulas but most of the time using the spreadsheet users gut instinct. Sometimes these are right and sometimes they are wrong.
AI does predictions. These predictions may be right or they may be wrong.
A well-done AI model will likely match or exceed a human’s instinctual prediction accuracy but at the cost of complexity and time to create a model. This is not an insubstantial cost for many businesses. If the business simply needs to make a handful of predictions to plan from, a couple of meetings of subject matter experts will probably suffice for planning purposes.
AIs real benefit comes when many people make many decisions based on many predictions and forecasts. Standardizing across any of these factors is laborious without AI. AI provides the solid foundation to make many, many forecasts – many more than people can make in spreadsheets.
Need predictions for future sales by vendor, item, region, color and style? AI models based on trends can do that very quickly with as much detail as the historical data can provide. Need to have those forecasts usable by many people in different departments? AI model predictions can be broadcast much more efficiently and quickly than isolated spreadsheet based predictions.
The other big reason to favor AI based forecasting in repeatability. Instead of many people in different departments making forecast predictions independently, AI based forecasting enforces uniformity across all departments so everyone is working from the same view of the future.
Do the forecasting again in 3 months with spreadsheets and the forecasts are at the mercy of different assumptions from different analysts. Using the AI system forecasts flow from the past to the present using a repeated analytical foundation.