This week’s forecasts – Was it the drink or Excel?

19 March 2018 15:54

Bargain Booze has got itself into trouble from a profit forecast 20% lower than expected with £5.2M of the fall due to a spreadsheet error: the shares have plunged over two thirds this year. We know that many if not most forecasting is done using spreadsheets. We also know that most complex spreadsheets contain errors (though perhaps not usually as spectacular as this one). The key surely is having a forecasting process as automated as possible (no cut and paste from one sheet to another) and key validation checks built into the process. A major project carried out by the Forecasting Centre for BskyB focused on exactly this – to remove much of the mundane calculations into documented Excel macros minimising the possibilities of error. But that last step will always rely on the senior manager to sign off the final forecast. Where we wonder was the ‘sense’ check?

 “This week’s forecast” is a blog series, which covers commentaries, by members of the Centre for Marketing Analytics and Forecasting, about topical and controversial forecasts in the news.

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