The Best Practices for Business Forecasting

Within these unprecedented times, it may be impossible to tell how your business will be in a week, let alone a year. Business forecasting can bring clarity to your business, even if it’s bad news. Generating frequent forecasts, if done well and with an objective in mind, can bring a multitude of benefits to an organization. But according to a recent study from Deloitte, only about a quarter of businesses are practicing forecasts. That leaves organizations with both, short and long-term strategies that fail to incorporate the current business environment and its volatile nature.  Business forecasting is the process of analyzing past and present data, along with marketplace trends. Forecasting can also help predict an organization’s future financial performance. It provides information that will help business managers identify weaknesses in their planning, so that they can adapt to the circumstances and achieve effective control of business operations.  Another reason, is that it can help propagate informed business decisions. Forecasting helps to see what is going on within your business, so that you can chase a new growth opportunity or discover near business challenges that may work towards/against your success.   Here is a quick guide to learning the best practices of business forecasting.   There are several methods for business forecasting. However, all of them fall within these two overarching formats: qualitative and quantitative.  Qualitative forecasting models can be useful in predicting the short-term success of an organization, however, there are limitations due to their dependance on subjective over measurable data. With this method, you're making business predictions without the benefit of measuring them against past data. It's the common method for new businesses that lack historical sales or expense data. It largely relies on the judgment of the team creating the forecast.  Some examples include: Market Research, and the Delphi method. Quantitative forecasting models are solely concerned with business data and numerical values. You can use this method when you have measurable data to inform the forecast. By measuring sales against past performance, you can gauge if business is growing or slowing. Some examples include: Econometric modeling, and Time Series methods. The right project tool can help business managers not only generate business forecast reports easily, but also better understand predictions and how to make strategic decisions based off of these predictions. A quality business forecast system should provide clear, real-time visualization of business performance, which facilitates fast analysis and streamlined business planning.  That is why TRIYO can help within your organization’s business planning. Our TRIYO INSIGHTS® Dashboard uniquely captures the progress of projects and tasks, employee’s individual tasks, and displays upcoming deadlines to report them to managers through simplified graphs and structured tables.   TRIYO’s machine learning and artificial intelligence integration allows managers to access pre-collected, data-driven operational predictions. This way, teams won’t get lost in the smaller intricacies of work and have more time to focus on their main priorities.  Learn more about how TRIYO can help facilitate an effective streamlined process for business forecasting by testing out our free interactive demo, or by filling out the contact us form below!