Forecasting an Uncertain Future
Forecasting demand or budgets is critical for all businesses, whether in the private or public sector. We have developed an approach that can be applied across a range of business sectors to allow risk and uncertainty to be incorporated into options appraisal and budget forecasting. A key output is CORE, a spreadsheet based forecasting tool that is delivered to the client to allow further scenarios or options to be investigated
Process
The CORE forecasting tool is developed through a staged approach, which enables quick implementation in new business sectors and delivers a tailored approach to meet clients needs:
- Investigate historic data: determine trends, distributions and variability of historic data. This can be within Excel, or for larger datasets using SPSS
- Propose outline model design, key drivers and the use of optimisation.
- Initial forecasts and model outputs for review.
- Delivery of forecasting tool and documentation. The model is currently developed within Excel witht the @Risk add-in, but other options could be developed if required
Application of Forecasting Tool (CORE)
The approach has been applied across a range of different business areas, the following two examples illustrate the wide range of applications that can benefit from the proposed approach.
