With uncertain times ahead it’s essential to ensure you are making the right decisions for your business. Having a crystal ball would be excellent but not possible. There are several business forecasting practices that can assist you in making an informed decision. In this blog, BAASS will share some strategies and tactics that will help improve your business practices.
Strategies and Tactics
Make as few assumptions as possible.
Predictions are not flawless. Be ready to modify your plan as the year progresses. A good model will typically fall within a 5% variation. Exceeding expectations can impact your business as much as falling short. Base your forecasts on solid history, research, and facts to the greatest degree possible, and keep true assumptions to a minimum.
Create a variety of forecast views.
Different leaders will often have different perspectives on how to grow the company. It is helpful to run many forecast views to reconcile the conflict between which course to pursue and its expected outcome. If the company has investors, their preferences should also be considered.
Keep clean records.
You can't make effective judgments with dirty data. Maintaining accurate records can improve how you conduct business. Maintaining accurate records can serve as evidence that you have made thoughtful decisions and taken appropriate actions. In the event that you are questioned or confronted, records serve as your defense. Ensure your team is using updated data to make well thought out decisions.
Consider Seasonality as a Factor
The accuracy of your forecast may fluctuate due to the seasonality of your selling cycle. For example, the accuracy you may observe varies in your monthly or quarterly forecasts on account of seasonality or related factors. Staying updated with industry trends and changes can help improve your forecasting plans.
Automate the procedure but leave room for manual overrides
Automating the forecasting of each base-level driver using the best statistical technique before releasing the findings for evaluation and modification by managers using their local expertise. Automating the forecast for the vast majority of clients in accordance with the 80/20 rule. This can offer managers more time to focus on the fewer, large accounts that account for the majority of the revenue.
Conclusion
During difficult economic times, the businesses that succeed are those that comprehend and satisfy their customers’ needs. Business forecasting can help anticipate future customer needs and keep your company on top of industry trends. It’s important to ensure your forecasting strategies are updated to support your company in making the right decision at the right time.
If you need help organizing your business forecast strategy try contacting the experts at BAASS.
