Planning plays a key role in every organization, and for obvious reason. Without a plan, employees don’t have a goal to work towards or an idea of how they are going to achieve it. In fact, without a plan, there may well not be any employees at all – after all, goals are unachievable without resources to work towards them and finances also need to be planned to accommodate them. But while this is the case, all too often the process of planning becomes incredibly time-consuming and is subject to change based on new information that was originally omitted or missing, resulting in a plan which delivers less return than the effort invested.
This is the premise of the latest research from Ventana, “Five Ingredients for Next-Generation Business Planning”, which advocates that a ‘predictive planning’ approach can maximize the effectiveness of the planning process to deliver a better return on the effort invested.
What is predictive planning?
Ventana defines predictive planning as “a high-participation, collaborative, action-orientated approach to planning built on frequent, short planning sprints.” This process can be supported through the use of planning tools
, and is in contrast to the traditional planning methods used by many organizations which are typically long-term in nature, created in silos without sight of other departments, and often forgotten or abandoned when reacting to changes in the market environment. Predictive analytics also play a significant role in the predictive planning process.
What are predictive modeling analytics tools?
Predictive modeling analytics (or predictive analytics
) tools are specialist software which can be used to predict and forecast trends or behaviors based on existing business data. These can be an effective way to create more-informed plans based on greater visibility of the organization and an understanding of where the business, or market, may be heading.
The benefits of predictive planning
So why should organizations consider changing their planning methodology? Four key benefits to taking a predictive planning approach are proposed by Ventana in the research paper:
• Greater accountability over the end result based on the high level of participation
• An increase in accuracy as refinements are made at shorter intervals by a greater number of participants
• Greater agility in responding to market or competitive changes thanks to shorter planning cycles
• The unification of finance, line-of-business managers, and executives through the more collaborative approach, enhancing coordination and alignment to strategy
These benefits are certainly appealing from a business perspective, but if a greater return on planning activities really can be realized through a predictive planning approach, how can it be achieved?