Accurate forecasting – the key to success

Published in November 2020 Fleet Affiliation

Each industry experiences forecasting challenges. Despite the best plans and intentions, the unexpected can occur. However, steps can be taken to help mitigate these unknowns. If complete and accurate forecasting were possible, budgets would be flawless and organizations would experience utopian-like efficiency levels. Unfortunately, this scenario doesn’t exist. Truthful forecasting is the next best thing, achieved by evaluating all available information to make predictions. Understandably, business conditions may change, new information becomes available and adjustments may be necessary.

A forecast is a prediction or estimate of a future event or trend. For example, weather forecasters have available data, plug it into models and present best estimates of future events. Although weather forecasting has improved in the past decade, new information becomes available and updated estimates can change the course of action. Business forecasts, like weather predictions, are truthfully made using available information. This approach can position individuals and organizations for successful long-term planning and flexibility when incorporating information that may change the course of action.

Using available tools to strengthen predictions
No single tool informs a completely accurate prediction; however, combining different informational sources and perspectives can narrow the gap and reduce some unknowns. Data is an important source of information, and data does not lie. Before utilizing data, two things need to happen. First, it has to be verified as reliable and complete data. Using inaccurate and incomplete data can be equated to assembling a truck without all the critical pieces. It may run and look complete, but will ultimately fail. Once verifiably accurate data is available, it can be leveraged to an advantage. The second requirement is to analyze the data and identify what the data represents. Having information is not enough. Capacity to understand and use it is a requirement.

How peers behave could be an overlooked knowledge source. They are likely also seeking information, collecting data and forecasting, but may have a different perspective and thought process that might reveal alternative outcomes. Benchmarking is an excellent exercise to either ensure your organization is on par with the industry or to generate questions your organization consider.

Fleet Purchasing Outlook
NTEA recently conducted its ninth-annual Fleet Purchasing Outlook Survey by gathering feedback from a wide variety of fleet professionals in mid- to high-level management, with authority to make decisions on truck acquisition and vehicle specification (results published early 2021).

Survey participants included a broad range of fleet sizes, vehicle weight classes and vocational truck applications spanning the U.S. and Canada. With current survey results combined with data from previous studies, the report will deliver year-to-year comparisons for benchmarking purposes. Insights show average truck age and replacement cycles, macro-level buying tendencies, predicted changes in fleet size, factors driving purchasing behavior, alternative and advance technology interest, approach to safety and automation, and much more. Visit Truck Fleet Resources for more information.

If you would like to discuss this, or other fleet issues with NTEA, contact Chris Lyon, NTEA director of fleet relations.