Forecasting
Forecasting is the latest expected cost of investments as the marketer executes on the investments. The Forecast column differs from the Plan columns, as the Plan columns are recommended to only be used at the beginning of the budgeting and planning phase for your organization to record their original bottom up plan. This serves as a baseline your team can compare your Forecast against throughout and at the end of the fiscal year.
It is crucial that your team records their up-to-date estimates on their spend as they carry out their day to day operations in the Forecast columns. The Forecast column will allow marketers to estimate whether they will be spending more or less than their original plan before the expenditures are recorded and imported into Uptempo. The Forecast is then used to better gauge how much in actuals are roughly still expected.
If your forecast is $1200, and to date, your Actuals/PO amounts that have come through are $600, you would still expect to see another $600. Throughout the year, you typically want to compare Plan vs Actual, Forecast vs Actual and Plan vs Forecast. You would stop updating the Forecast when you have no more estimate changes for that period.
Transition from the plan to the forecast phase
When the planning phase is complete and you enter the forecasting phase, there are usually two options:
You start with the amounts of the plan phase as a starting point. To avoid having to transfer the amounts manually, you can export them from the plan columns and import them into forecast columns. Note Transfer plan amounts to forecast columns.
You start the forecast phase without amounts and enter the respective expected amounts as you execute on the investments.
Forecast status
Forecast status enables you to gain a better understanding of where you have made financial commitments and where you are leaving money on the table. The status tags identify if investments are planned, have a signed contract, or have taken place. Investments that are planned can be cut if the budget gets cut, or the money can be reallocated to other investments where necessary. At the end of every month, any funds allocated to an investment that has not occurred should be reallocated to the month the investment will take place, or to another investment to keep financial records accurate.
For more information on how to track the forecast status see Use forecast status tags.
Plan vs forecast variance
The Plan column shows the bottom-up plan of investments that will be completed to spend the allocated budget and the Forecast reflects the latest expected costs. The Plan vs Forecast variance shows how much you are under or over forecasting against the original plan. Using the variance, you can identify if you are under forecasting due to changes in comparison to what we planned. This allows for reallocation of funds to investments that may require more funding, or to investments, we didn’t originally plan for, see Reallocate investment funds.
Related actions
Editing the cells in the Forecast columns is identical to the planning phase. For more information on editing amounts, refer to Add spend data to investments, Add calculated costs to investments, and Enter an amount in a different currency.
Specific to the Forecasting phase, consider the following actions: