The Analyst's Path

Glossary

Driver

M3.07 · M3.08

Also called value driver, model driver.

The underlying quantity from which a forecast line is built, rather than a growth rate applied to last year.

Revenue of ₹4,800 crore modelled as 40 stores at ₹120 crore each is a driver-based forecast; the same number modelled as last year plus 12% is not.

The difference matters when the assumptions are tested. A store count and a per-store revenue can each be argued about against evidence; a blended growth rate cannot.

Driver-based models are longer and are the only kind worth defending.