planning vs forecasting

[bloggerman]

Whats the difference between planning and forecasting?

[ericlfg]

Hi bloggerman,

The easiest way I think of the two:

Planning:
Setting up a budget or spending plan based on actual values taken from previous months.

Forecasting:
Hypothetical, what-if scenarios based on whatever floating, non-concrete variables are involved.  Sometimes this will be done using actual numbers just like planning.

In essence, Planning is what you WILL spend money on based on real numbers.  Forecasting is what you MIGHT spend money on in the future based on real or fake numbers.

Hope this helps..   if anyone can summarize the difference more eloquently than I have, please take a crack at it.

[jeffowentn]

I've always had a slightly different perspective in that planning is more like the static budgeting that most companies do annually, and forecasting is the process of updating a version of the plan on a more frequent basis throughout the period (like weekly, monthly, or quarterly updates).

[JaromirSeps]

Hi,
If you're more interested into this, check out:

http://www.amazon.com/Future-Ready-Master-Business-Forecasting/dp/0470747056/ref=pd_sim_b_3

It is a really good book about business forecasting.

Jaromir