causes the trend line to change. Identifying these discontinuities is a critical
activity, which this simple technique ignores.■ Modelling
Modelling techniques have a generally more sophisticated approach to
forecasting than trend extrapolation. This technique tries to identify the
key variables in a situation and to model how they interact with each
other. In this way the key inputs to a particular market can be modelled.
Once the model is created variables such as quantity of supply or con-
sumers’ level of disposable income can be altered to see what effect this
has on the market as a whole. These variables tend to be those that can be
easily quantified. The problem with this approach, when applying it to
futures forecasting, is that what appear to be key variables in the current
market may not be the key variables in the market of the future. The rela-
tionship between these variables may also change in the future.
To enable managers to form a more challenging view of the future other
techniques have to be used that foster a more creative approach.■ Intuitive forecasting
There can be some merit in an individual forecast or ‘Genius’ forecast. If
an individual is an expert in a specialist area they are able to form a com-
prehensive overview of their area of activity. This can allow them to see
potential patterns or relationships emerging that very few other individ-
uals or groups have the perspective to contemplate.
In the 1930s military planners believed that any future war in Europe
would be a repeat of the type of war fought between 1914 and 1918, with
armies facing each other over fortified defences. One individual wrote a
book called ‘The army of the future’ in France in the early 1930s forecasting
that any future war would be dominated by highly mobile tanks sup-
ported by aircraft. The British and French high commands rejected this
forecast. The Americans believed they understood how a mobile war
should be fought due to their experiences in the ‘non-mechanised’
American Civil War and rejected the book’s view of the future. Adolph
Hitler read this book and as we now know realised the strength of the
ideas it contained. The book was written by a certain Charles de Gaulle
then a little known French army officer. This is a dramatic illustration of
the power of an individual genius forecasting the future.
However the dangers of individual forecasts are obvious. An individ-
ual forecast is a personal judgement and is open to idiosyncratic interpret-
ations of an individual’s observations.
In reality though many company’s forecasts are reliant on an individual.
This may be the owner of a small company or the marketing manager in114 Strategic Marketing: Planning and Control