Is This Any Way to Plan?

Most organizations do some kind of long-range planning. Yours probably does.

At many companies, though, in spite of all the time and personnel invested in planning, the actual strategic plan that emerges at the end of the process is based on—no, practically joined at the hip with—a set of forecasts that implicitly consider the future as an extrapolation of the present, a more or less linear continuation of the situation these companies are already in, right here, right now. Isn’t that convenient?

The planners in your company might disagree. I’m sure they see their work as being a little more sophisticated than that. “Extrapolation? No way!” they will sputter. “Stop insulting us! We do a lot more than just taking known data points from the past and extending a straight tangent line beyond the present limit!” (I’m not sure if people actually talk like that, but this is more or less how they will defend themselves.)


But that is what they’re doing. Well, to be more precise, there are two kinds of extrapolations going on in most companies. The first is a mathematical operation. And here, I could sympathize with why planning experts might take umbrage at the idea that “extrapolation” is all they do, since any high school sophomore should be able to produce a decent projection in 10 minutes on an Excel spreadsheet: Just plug in the numbers from the last couple of years and you’re done. “Hey guys! ...

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