I read something this week that merits sharing and reinforces why business performance management is so critical during challenging economic times. In February of this year, a poll - the Business Volatility and Variables Survey - was conducted by Adaptive Planning and the Business Performance Management Forum. Financial executives were polled, and here are some of the survey findings.

Fifty-one percent of these financial executives predict a "W-shaped" recovery, up from 46 percent a quarter ago, and 72 percent expect that a recovery will not occur until the second half of 2010 or later. Additionally, 67 percent expect that a meaningful improvement in jobs will not occur until 2011 or beyond.  

Respondents have brighter expectations for their companies than they do for the overall economy. More than half (55 percent) expect revenue growth for their company over the next six months, while 25 percent expect to add jobs - more than the 17 percent that project jobs growth from the broader economy in the next two quarters.  

A number of factors indicate that small and midsized companies could lead the way out of the recession. Employee growth expectations in the next six months are about three times higher in the small (31 percent) and midsized (27 percent) company sectors than for large organizations (only 10 percent).  And midsized organizations are much more upbeat about the future, with 49 percent expecting economic improvements in the next six months versus only 34 percent of large companies.

Consistent with previous quarterly results, overall economic uncertainty remains high, particularly with smaller companies (61 percent) and midsized companies (50 percent) versus large organizations (39 percent). Nearly half (49 percent) came in under their revenue plan last quarter, though some of this was offset by lower than expected expenses (36 percent). Economic uncertainty and ongoing underperformance versus plans continue to drive an increased need for frequent scenario planning and what-if analysis, with 59 percent expecting to do so more often next quarter.

"Taken together, these results illustrate an extremely mixed outlook for both the economy and corporate performance over the foreseeable future," said William A. Soward, CEO of Adaptive Planning. "While there are downside risks from a possible double-dip recession, there is also the potential for upside surprises, given the fact that the company-specific outlook is brighter than that for the overall economy. In either case, the successful companies will be those that are able to plan for multiple scenarios, closely monitor their actual performance, and respond quickly to changes in their business and operating environments."

For more information on the summary report of the findings, download the PDF.