What is Backcasting? How is it different from Forecasting?

Backcasting is what can be understood as the opposite of forecasting and is one of the techniques to manage uncertainties and risks pertaining to future just like forecasting. However the way backcasting and forecasting approaches “the future” is very different.

In forecasting we gather information about present conditions and then extrapolate them according to expectations, fears and possible opportunities. It is an attempt to extend the present in order to visualize what would the future like. So in simple words forecasting is drawing expectations out of expectations applied on present circumstances. It is early adaptation to the expected changes in future so that impact can be minimized. If we sum up forecasting in steps then it will be as follows:

• Gather information pertaining to present
• Gather information about future possibilities and events
• Draw expectations about future out of present information
• Apply those expectations to present situations to visualize what the future might be
• Mend the short term plans to stay on favourable course of business operations

As you can see under forecasting we acknowledge that future is completely out of control and thus we can only adapt to it. We can adjust to it rather then adjusting future itself.

In backcasting we challenge the very way we think in forecasting and move almost opposite to it. In this technique we start with the point where we want to be in the future and then try to adjust everything in the present according to the target we want to achieve. If we summarize the steps in which backcasting is done then these can be as follows:

• Define and establish the targets or better to be called vision to be pursued
• Gather information of present conditions and circumstances
• Analyze the information gathered to ascertain what changes and amendments are required to the present conditions so that ultimately it comes inline with the vision established.
• Establish a policy and strategy to implement the changes required

Author’s note:

Backcasting is not new and it has been in action since very long. If we observe closely the way multinational companies work and sell their products we can understand that they create the market. We already are familiar with the terms like market shaping strategy where customers get an illusion that they are being provided with something new where in most of the cases it is not true and the companies would have spent millions in advertisements to first create the desire for the product that they want to launch in future and have worked for years to channel the people mind set in this moulding process so that they have programmed customers ready to buy their products and thus promised profits.

Now its upon readers to think about the ethical issues involved in backcasting.