The plan that assumed the tariff schedule

Almost every five-year plan written two years ago carried one line nobody examined: that the terms of trade would hold.

It was never presented as a forecast. It sat underneath the volume assumptions, the sourcing decisions, the capital plan and the headcount that followed from all three, and because it sat underneath them it was never separately argued. Nobody defended it, so nobody could attack it.

When the terms moved, the argument had to happen anyway, at speed, in a room where half the people who could have answered it were not present and the other half had inherited the plan rather than written it. That is the expensive version of the same conversation.

The useful work was never to predict the change. Prediction is a poor business to be in and a worse one to sell. The useful work was to know, before anything moved, which parts of the plan depended on that line and which did not. Most of a plan usually does not. The parts that do are rarely the parts a board spends its time on, because they tend to be operational, dull, and settled early by people who were not asked to write down why.

A plan that names its own dependencies survives the news. It does not have to be right about the world. It has to be honest about where being wrong would hurt, so that when the world moves the meeting is about a decision rather than an archaeology.

We have yet to meet a company that could not do this exercise. We have met very few that had.