GRANT THORNTON REPORT: 39% OF ARMENIAN BUSINESSES FOLLOWING A 1-3 YEAR PLANNING CYCLE
armradio.am
15.04.2009 17:36
Latest research from the annual Grant Thornton International Business
Report offers new insight about how far into the future privately
held businesses (PHBs) plan. The most common planning period is 1-3
years, favoured by 49% of PHBs globally. 39% of Armenian businesses
participating in the survey also have the same planning cycle. Of
PHBs following a 1-3 year planning cycle, the highest proportions
were in Denmark (64%), followed by New Zealand and the United Kingdom
(both 60%) and India and Greece (both 59%).
PHBs in mainland China are the longest term planners with 44%
of businesses planning more than three years ahead, as opposed to
Armenia’s average of 22% for the same period of planning.
Short term planning is favoured by 21% of PHBs globally and is
especially common in Latin America, with 73% of PHBs in Mexico, 71%
in Argentina and 43% in Chile using a planning cycle of less than
12 months. Armenia, with 35% of PHBs adopting this approach, is also
well above the global average of 21%. It is noteworthy that financial
services is the sector where businesses make the longest plans.
Gurgen Hakobyan, Partner at Grant Thornton Amyot, explains, "Our
experience with many of the privately held companies in Armenia shows
that 3 years is the most common planning period. Usually businesses
plan up to 3 years in our country. This is quite justifiable taking
into account the economic instability. The global economic downturn
is also challenging the formal planning and making it more and more
flexible to be able to respond to arising difficulties. However,
having a short-term operational plan does not eliminate the need for
having a long-term strategic plan. The challenges in the short-term
perspective are easier to overcome if the business has clear vision
of its long-term plan."