Use of the Time-Sharing Computer in Business Planning and Budgeting

The time-sharing computer system now being operated in Phoenix by the Computer Department offers any Company executive willing to spend a few days learning to use the system an entirely new capability to explore and prepare business forecasts. The system does the arithmetic and prints the results in the privacy of the user's office in a few minutes. The planner can explore a range of assumptions and estimates impossible to handle by manual methods and difficult and time-consuming by more traditional computer methods. With the system, the planner can state his basic data and assumptions, observe the results, and then modify any of the assumptions he chooses and get new results within a few minutes. By following this procedure several times it is possible to explore the effects of a variety of environmental assumptions, such as market and price structure for a new product, and to find out what budget of costs for the new product must be realized to yield acceptable business results. This procedure, which requires many days of the time of several individuals by manual methods, can be completed in most cases by one man in less than one day, including the initial programming. An example from a recent new business study is given.