There's an interesting conversation going on at The Entrepreneurial Mind about revenue forecasting. You ought to read the post and comments.

Here's my $.02 on the subject.

Every business should have a revenue plan. Why? Because it's the only way to remain consciously competent. You need to know why you win or loose. A plan makes you think. A plan makes you document what you're about to do. And reviewing the plan afterwards gives you the opportunity to evaluate where you went wrong, what faulty assumptions you made, and how you can improve in the future. They're equally valuable when you blow past your number and over achieve.

Why do so many revenue plans fail? Because they are written looking through rosy glasses and not enough care is taken evaluating all the critical things on the left hand side of the equal sign. Too many revenue plans aren't believable and too many start with the desired result - the revenue you want to make, not the revenue you'll realistically make. But that doesn't make revenue planning a bad exercise, it just makes it an exercise that needs more care and realism.

What are your thoughts on revenue planning?