Planning under Uncertainty
Let’s say that the board have sketched a future desired value of the company’s equit, and that you are left to find out if it is possible to get there and if so – the road to take …
Let’s say that the board have sketched a future desired value of the company’s equit, and that you are left to find out if it is possible to get there and if so – the road to take …
We know that forecasts based on average values are on average wrong. In addition will deterministic models miss the important uncertainty dimension that gives both the different risks facing the company and the opportunities they bring forth.
We know that forecasts based on average values are on average wrong. In addition deterministic models will miss the important dimension of uncertainty – that gives both the different risks facing the company and the opportunities they produce.
The uncertainty about the future yearly Pax is quite high. With this as the backcloth for airport planning the stochastic nature of Pax forecasts has to be taken into account when investment decisions are to be made.
Most companies have some sort of model describing the company’s operations. They are mostly used for budgeting, but in some cases also for forecasting cash flow and other important performance measures.
Enterprise risk management (ERM) only has value to those who know that the future is uncertain. Businesses have three key needs: First, they need to have a product or service that people will buy. They need revenues. Second, they need […]