ABSTRACT
This chapter analyzes the process of business planning and forecasting. Business planning is a way of managing time, and of anticipating the future. Business forecasting is a basic ingredient of this planning process. Forecasting is an attempt to visualize the way in which market or other external environmental variables might behave during the planning period within which the enterprise is working. Forecasting and planning are inter-related. An enterprise cannot plan ahead without making forecasts, and it cannot make forecasts without having some kind of plan to act as framework for the forecasting process. Planning assumptions are predictions about the likely environments in which plans are expected to be implemented. Sales, market and operational forecasts are a key part of the planning process in any commercial, public sector, or not-for-profit organization. Operational Research models are used to simulate the workings of a real-life system or structure, so that the planner can identify or "experiment" with alternative patterns or behaviours.
