Dr. Jain (Chief Editor of the IBF’s Journal of Business Forecasting), and I have recently been collaborating on an article that is a wake up call for Planning organizations to have their house in order so they can recognize the signals for an economic recovery. I am a proponent for completeness and integrity of the forecast across the full planning horizon. In fact, right now I would bet most Planners are only focused on the next 3 months. Of course, not all industries are alike. So forecast horizons and forecast buckets differ (weekly vs. monthly), but in most cases, the further out in time you go the less attention the organization gives to the quality of the forecast. You can often see year over year comparisons where volumes may actually show a decline only because the Planners have not included future promotions or new product launch activity. How can we give Senior Management confidence in the sufficiency of our volume forecast to meet our growth goals if we are not giving the same focus of attention to the 18, 24, or 36 month out forecast that we give the 3, 6, and 9 month out forecast? The discussion I would like to generate is how ‘Yes We Can’ align our volume forecast with our financial forecast in such a way that we can work with a single number forecast for at least an 18-24 month time horizon. Plus, how the S&OP process can close those gaps and provide better forward visibility.
As Anish Jain (Managing Director of the IBF) has planned these presentation paths at the IBF’s Orlando Conference, you can see that one discussion easily builds on another so we end up with a chain of conversations over the course of 3 days. This helps to fully vet the possible options for us take different best practices back into our work environments. As a member of the IBF for over 10 years and a huge fan of the Journal of Business Forecasting, I have to say that attending the Best Practices conference in Orlando is always my favorite event. To be able to speak this year is a great honor, but the highlight for me is meeting and sharing best practices with Planning experts from around the world and from every industry imaginable.
Your comments based on what works and does not work in your process to build forecast quality and integrity are welcome. Hopefully, we can have a meaningful dialogue where we all benefit.
Innovation Diamond Management
Procter & Gamble
See MARK COVAS SPEAK at The IBF’S: