The Definition of Forecasting Insanity

Simon Tucker

Chief Planning Officer

OK, I admit it, I used to be an addict. An addict to spreadsheets that is. Boy, I could macro with the best of them – in fact I even completed a few courses of VB 5 and 6. Holy cell references Batman, the 90s sure were fun for that sort of thing. Why did I get so into Microsoft Excel spreadsheets, macros and VB code? Well, I just needed to plan and forecast some stuff.

In those days I was heading up a Management Information and Systems team for a large publicly traded group of companies – 8 to be exact. Of course juggling all those companies with all those spreadsheets, (yep, I used to open up my workbooks and go for coffee while the dynamic links updated), was a nightmare. We knew the data had to be inaccurate. We gave it best guess in many instances. The data came to us in all sorts of forms. Every year, I would start from scratch and re-design everything to try and get rid of the bugs and formula errors that spreadsheets are so good at organically growing for you. Plus, business changed and trying to tweak the spreadsheets I had just proved to be too much hard work.

At times I think the spreadsheets were working against us like HAL in 2001 Space Odyessy …

I’m sorry Dave …

Of course the reason I kept redesigning the spreadsheets was because I expected a different, more accurate result the next time. But, as we all know, that’s just insanity when it comes to spreadsheets and forecasting. They’ll always give you the same result – just never the one you want.

So, having been in the planning and analytics game for many years now, I can’t help wondering why people still rely so heavily on spreadsheets for such a critical process. Share a spreadsheet with anymore than one person and things start to go wrong. Try to change the spreadsheet model too much and things start to get dicy. Use one of these enterprise applications and things get, well, that’s for another post.

But, we’ve moved on now. At least those in know have. New kids are coming on the block that really get the issues.

So, in my opinion, to continue to use spreadsheets as a mainstay for the critical decisions organizations have to make is the definition of forecasting insanity.

Let’s all move on.