ACCA Performance Management (F5) Certification Practice Exam

A long-term sales forecast is primarily associated with which type of planning?

1. Operational Planning

2. Strategic Planning

3. Tactical Planning

4. Project Planning

The correct answer is: Strategic Planning

A long-term sales forecast is fundamentally linked to strategic planning because it involves the assessment of various market factors and trends that can influence an organization's direction over several years. Strategic planning encompasses setting long-term objectives and determining the resources necessary to achieve them, which includes understanding future sales potential and market conditions. Sales forecasts play a crucial role in shaping the strategic decisions of an organization. They help identify potential growth areas, allocate resources effectively, and establish marketing and investment priorities. By having a clear picture of expected sales performance, management can devise strategies that align with the predicted market environment, ensuring the company is positioning itself effectively for the future. Operational planning, in contrast, focuses on the short-term execution of strategies and how day-to-day operations will be carried out. Tactical planning generally refers to the medium-term planning that translates strategic objectives into specific actions, while project planning is concerned with the development and management of individual projects with defined objectives and timelines. Thus, these types of planning do not directly prioritize long-term forecasts in the same way that strategic planning does.