The IMPACT Forecaster® is a series of reports and projections that a business will use to forecast its future performance in the areas of cash flow, profit, and financial health. It includes short and long term cash flow projections, financial models, business models, and much more and always include the following ingredients: insightful, meaningful, precise, accessible, comparative, and timely.
Insightful - The purpose of a projection or forecast is to provide insight into what will happen in the future if all of the assumptions in the projections are valid. Whether we learn that our assumptions were incorrect or we learn how to better plan for and manage our future, all of our projections need to be insightful.
Meaningful - If the projections or forecast are done correctly, they will become a critical component of planning how to manage and grow a business in terms of cash flow, financial health, and profitability.
Precise - Many business owners and managers hesitate to trust projections and forecasts because it is difficult to predict the future. By quantifying many of the key assumptions of the business, the future becomes much more predictable and measurable. To the furthest extent possible, the information, assumptions, and data points in the forecasts need to be grounded and accurate in order for the results to be meaningful and helpful.
Accessible - The forecasts, models, and projections of a company need to be easily accessible both intellectually and physically. Intellectual accessibility refers to avoiding large tables of overwhelming data points and using charts and graphs as much as possible. Physical accessibility is primarily about making it as easy as possible for everyone to see and access the information. Forcing people to have a certain kind of software or another user name and password just to access the information creates barriers as opposed to free access. Most will not open the attachment to the email you send or else they will forget where they saved the file.
Comparative - A forecast or model needs to look to two sources of information to put its assumptions into context - first, its own performance, and, second, the performance of its competitors and others in its industry and similar industries.
Timely - Every forecast or projection is about time. How long will it take to ramp sales to the break-even point? How many months will it take until the company runs our of cash? In which month does the company become cash flow positive? These and other questions should be answered by a projection or forecast. There are several different IMPACT Forecaster® products, including: