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Machine Learning for Time Series with Python - Second Edition
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In December 2011, Best Buy canceled thousands of online holiday orders hours before Christmas. The company blamed overwhelming demand from Black Friday promotions. The real culprit was a forecasting system that treated sales as an isolated time series, unable to connect planned promotions to inventory needs. This single failure mode, ignoring correlations between variables, costs global retailers an estimated $1.8 trillion annually in stockouts and lost sales.
The energy sector faces an equally dangerous version of this problem. In August 2020, California's grid operators ordered rolling blackouts affecting millions of residents. Their forecasting models had overestimated solar generation during evening peak demand. As the sun set during a heatwave, solar output plummeted while air conditioning demand remained high. The models failed to capture the critical negative correlation between solar availability and evening load during extreme weather events.
Both these...