How much inventory do you have today, and how much will you need tomorrow? Can you reliably estimate current consumer demand as well as predict their changing needs? How about the strength and quality of your supply chain? Will it be able to continue delivering what you need when you need it during fluctuating market conditions?
Such questions are easier to address when you add artificial intelligence and machine learning to your processes to beef up your organization’s demand forecasting capabilities. The success of your manufacturing business depends in part on gaining valuable insights into future market trends so you can better plan for resource allocation and production.
With so much information to sort through and analyze daily, it’s difficult for people to shape production independently without assistance from data-intensive computer systems. To keep up with competitors on a global scale, manufacturers are turning to artificial intelligence-powered demand forecasting to bolster their production schedules and resource allocation planning.
Leveraging machine learning algorithms on advanced manufacturing platforms can help your company optimize production planning and enhance overall supply chain efficiency. This article explores the transformational potential of AI regarding demand forecasting in manufacturing.
Many Uses for AI in Manufacturing Facilities
Installing AI tools for manufacturing confers many benefits. You can run a leaner, tighter operation, which leads to more sustainable production. Using AI for demand forecasting will help you plan how to allocate resources going forward.
Manufacturers also use AI tools to detect defects better and to improve their quality assurance. When you have a better handle on your defect rates, you can predict how much you’ll need to re-order (in terms of raw materials and parts) through the supply chain. You can also conduct capacity planning with more reliability.
About Demand Forecasting for Manufacturers
It can be tricky to forecast demand amid fluctuating conditions in the marketplace. As trends evolve, you want to compare historical data to help you better predict what customers will be demanding in the future.
While people can make reasonable predictions on their own when the market is calm, it’s more challenging when demand seems to be in flux and there is significantly more data to gather and process. In the face of uncertainty, manufacturers harness machine learning and AI to keep up with torrents of information.
Predicting Future Demand More Easily
It’s a trivial matter for an AI-fueled demand forecasting system to consider variables such as shifting market conditions, promotions you devise to boost consumer interest, and seasonal demand from shoppers.
AI will help you forecast this demand more accurately because it works with more information than any human could process.
Making Manufacturing Processes More Efficient
Your goal will be to create an adaptive supply chain that uses AI tools to keep up with forecasted demand.
Implementing machine learning makes manufacturing operations work more efficiently.
Main Benefits of Using AI in Manufacturing
In addition to using AI to run your manufacturing processes more smoothly and efficiently, there are benefits to boost profits and reduce waste:
Increase profitability
AI-powered demand forecasting will assist your team in predicting what your customers want and need and when, even when you see fluctuations in the market and changes in consumer trends. When you can fulfill orders without delay based on these predictions, you increase profits, and your customer satisfaction statistics should also improve.
Cut down waste
Streamlining manufacturing operations with guidance from analytics based on machine learning and AI tools will naturally reduce waste — another factor in boosting profits. Order just what you need instead of purchasing in excess because of uncertainty about consumer demand and how to allocate resources more efficiently. Rather than storing a great deal of overstock, you can use your warehousing facilities better, with fewer unsold units remaining on shelves.
Determining the Right AI Tools to Deploy
Do research to see how other manufacturers with similar production requirements as your own have used AI to improve their demand forecasting. For example, you will want to pull in information from various Internet of Things (IoT) devices and your MES or Manufacturing Execution Systems. The AI system must include analytical tools to forecast demand as accurately as possible.
You will want to use machine learning and AI systems that will readily scale up as your company grows and diversifies. This is especially critical when you adjust manufacturing operations, such as to take advantage of new, advanced equipment. Your AI should be customizable so it’s possible to integrate it with your current software and computational systems.
Using AI-Powered Demand Forecasting to Improve Your Supply Chain and Run Manufacturing Operations More Efficiently
With machine learning algorithms and AI tools helping companies in a wide range of industries work more efficiently, it makes sense to deploy them in your manufacturing company so you can remain competitive. You’ll strengthen your supply chain when you can forecast demand more accurately thanks to algorithms that process information on your behalf.
IoT devices in your manufacturing facility provide vast amounts of data you can take advantage of much more quickly when you analyze them with AI. The same goes for the data from Manufacturing Execution Systems.
