Beyond budgeting

Posted by:

Great presentation on Beyond Budgeting at the Perf Mgmt Assn in Cambridge by head of reporting at Statoil. A small group of top corporations [see Linked-In] including names like Google, Telenor, Toyota are junking the whole idea of annual budgets and devolving continuous target-setting to teams. If I understood correctly, in principle any team can change any target, and any performance indicator, at any time, for any reason – the control being credibility with their peers, ...

Continue Reading →
1

Strategy Dynamics Breifing 7: Problems with typical approach to business planning and forecasting

Posted by:

Why is the typical approach to business planning and forecasting flawed?

Strategic planning generally aims to get to an estimate of future sales and profits, so how these items are estimated is critical. Typically, you would start with a forecast for demand, and by assessing how competition could affect prices, get a value-forecast for the market. Setting targets for increased market share would then give a forecast for sales volume and revenue. There are however problems associated with this typical approach ...

Continue Reading →
0

Anyone using game theory?

Posted by:

Though I have heard of game theory being used in a few particular and special cases (e.g. the auctioning of 3G cellphone licenses) I have not seen anything of it being used in general strategic management or business planning. The strategy textbooks dismiss it as too uni-dimensional and limited to special cases to be useful, and I can find virtually no articles in e.g. Harvard Business Review or McKinsey Quarterly giving any encouraging cases where it has been helpful. (Though ...

Continue Reading →
3