Using Scenarios

10 Modeling Financials with Scenarios

Financial analysts often rule the organizations in which they live (Smith et al., 2011). Their analyses tend to capture the attention of leadership in two important categories: (1) quarterly earnings and (2) return to shareholders (Gelles & Yaffe-Bellany, 2019). In most cases the board’s expectations are a direct result of the model built by the finance team. The reality is that most companies and CEOs are held to their boards’ expectations. The demand for a quarterly financial growth outcome is hardly supportive of organizational longevity (Collingwood, 2001; Millon, 2002; Zhang & Gimeno, 2016). Squeezing ...