COVID-19 turned the world on its side, and every company was left struggling to navigate the path forward. As the new normal evolves, businesses continue to face unprecedented challenges in navigating an always-changing economy and global environment. From supply chain disruptions to increased worry about inflation and consumer behavior, one thing is clear – the new normal is still undefined. This blog recaps a recent survey conducted by Prevedere among senior-level executives to collect business leader’s opinions on business planning in the wake of the pandemic.
COVID-19 Significantly Changes How Business Plan and Forecast for the Future
Throughout the last year and a half, traditional planning methods were thrown out the window and businesses have had to adapt in the face of unprecedented uncertainty. When the pandemic began, many businesses had never experienced a global event of this scale and were caught unprepared. 1 in 4 businesses were ill-prepared to face a global event such as the pandemic pre-2020 and 16% were not prepared at all.
COVID-19 uprooted traditional expectations and methods of business planning. Businesses could no longer rely solely on internal historic data to project future performance and were forced to make changes to their planning process. It comes as no surprise that 83% of senior-level executives reported that COVID-19 changed the way they forecast and plan for their business.
The most common changes businesses made in the last year include planning at a higher frequency, paying closer attention to external economic signals, and leveraging new forecasting methods. As businesses look to make changes to their planning process, they are turning their attention to the latest technology and tools, with 2 out of 5 businesses investing more heavily in analytics. Most notably, there was a 110% increase in the number of businesses investing more heavily in external data compared to Prevedere’s previous survey conducted in December 2020.
Various Sources of Uncertainty Remain in the New Normal
In addition to the pandemic, various sources of uncertainty persist today. At the top of mind for business leaders right now is global supply chain issues, inflation impact, changing consumer behavior, labor shortages, and wage increases.
To navigate this world of uncertainty, strategic businesses are transforming their planning practices with the power of big data and predictive analytics. The survey identifies 3 ways that leading businesses are adapting to the new normal:
- 67% of businesses are revisiting and iterating their plans and cycles at a much higher frequency or cadence than previously
- 58% of businesses are including multiple economic scenarios in their forecasting process
- 54% of businesses are augmenting their internal data and insights with external market signals to understand how external factors will impact their business
Check out the full survey results report for more in-depth analysis.