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Strategic Planning And Forecasting Fundamentals

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  • JS Armstrong

    (The Wharton School)

Abstract

Individuals and organizations have operated for hundreds of years by planning and forecasting in an intuitive manner. It was not until the 1950s that formal approaches became popular. Since then, such approaches have been used by business, government, and nonprofit organizations. Advocates of formal approaches (for example, Steiner, 1979) claim that an organization can improve its effectiveness if it can forecast its environment, anticipate problems, and develop plans to respond to those problems. However, informal planning and forecasting are expensive activities; this raises questions about their superiority over informal planning and forecasting. Furthermore, critics of the formal approach claim that it introduces rigidity and hampers creativity. These critics include many observers with practical experience (for example, Wrapp, 1967).

Suggested Citation

  • JS Armstrong, 2005. "Strategic Planning And Forecasting Fundamentals," General Economics and Teaching 0502066, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpgt:0502066
    Note: Type of Document - pdf; pages: 31
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/get/papers/0502/0502066.pdf
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    References listed on IDEAS

    as
    1. Robin M. Hogarth & Spyros Makridakis, 1981. "Forecasting and Planning: An Evaluation," Management Science, INFORMS, vol. 27(2), pages 115-138, February.
    2. Armstrong, J Scott, 1978. "Forecasting with Econometric Methods: Folklore versus Fact," The Journal of Business, University of Chicago Press, vol. 51(4), pages 549-564, October.
    3. JS Armstrong, 2004. "The Seer-Sucker Theory: The Value of Experts in Forecasting," General Economics and Teaching 0412009, University Library of Munich, Germany.
    4. J. Scott Armstrong, 1982. "The value of formal planning for strategic decisions: Review of empirical research," Strategic Management Journal, Wiley Blackwell, vol. 3(3), pages 197-211, July.
    5. Thune, Stanley S. & House, Robert J., 1970. "Where long-range planning pays off Findings of a survey of formal, informal planners," Business Horizons, Elsevier, vol. 13(4), pages 81-87, August.
    6. Milton Leontiades & Ahmet Tezel, 1980. "Planning perceptions and planning results," Strategic Management Journal, Wiley Blackwell, vol. 1(1), pages 65-75, January.
    7. Armstrong, J. Scott, 1977. "Social irresponsibility in management," Journal of Business Research, Elsevier, vol. 5(3), pages 185-213, September.
    8. J. Scott Armstrong, 1986. "The value of formal planning for strategic decisions: Reply," Strategic Management Journal, Wiley Blackwell, vol. 7(2), pages 183-185, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Armstrong, J. Scott & Reibstein, David J., 1985. "Evidence on the Value of Strategic Planning in Marketing: How Much Planning Should a Marketing Planner Plan?," MPRA Paper 81680, University Library of Munich, Germany.
    2. Heckmann, Lotta & Memmel, Christoph, 2024. "How good are banks' forecasts?," Discussion Papers 03/2024, Deutsche Bundesbank.

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    More about this item

    Keywords

    planning; forecasting; strategic;
    All these keywords.

    JEL classification:

    • A - General Economics and Teaching

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