In the face of great economic uncertainty, the ability to gather and interpret information quickly is vital for decision makers, especially when a crisis turns into a recovery or vice versa. Those who are able to quickly and appropriately understand and respond to the developing situation will not only survive but also create a more resilient organization.
To this end, leading institutions are increasingly adding nowcasting – a predictive model developed in response to the dot-com bubble and recession of 2008 – to their decision-making toolbox. Nowcasting resulted from the over-reliance on typical economic data during past crises – often with a release delay of up to six months – exposing many companies to both missed opportunities and potential risks.
Traditional nowcasting served its purpose well, but the COVID-19 crisis has been challenging for most models. A next generation approach supports critical decisions and the advancement of strategy.
Read more about this new approach in this article by McKinsey & Company.