What executives get wrong about economic modelling and three ways to make it useful
Economic modelling has a credibility problem.
Too often, it’s seen as something done after the fact – built to validate a conclusion, defend a proposal, or meet a compliance requirement. Organisations commission it, review it, but rarely trust it. And when modelling falls flat, the problem usually isn’t technical. It’s strategic.
At Orizontas, we have worked with economic modellers extensively. Focusing on energy, infrastructure, health and government, we’ve seen where modelling drives alignment, unlocks funding, and shapes decisions. And we’ve seen where it fails to gain traction, even when the analysis is sound.
The difference usually comes down to three things: relevance, communication, and actionability.
What is economic modelling and who is this article for?
Economic modelling is a structured way of quantifying how a project, policy or investment could impact key outcomes – such as jobs, costs, emissions, GDP, or productivity. It’s often used in business cases, regulatory submissions, funding proposals, and public policy decisions.
| This article is for: |
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| Executive teams preparing or reviewing economic models for major projects or proposals Corporate affairs and policy leaders involved in advocacy, stakeholder engagement, or regulatory submissions Project leads, finance teams or advisors tasked with translating complex analysis into clear, decision-ready messages |
1. Make it relevant to the decision
One of the most common traps is designing a model that answers the wrong question.
That might be a legacy question from an earlier stage of the project. Or one shaped internally, without considering who the audience is and what they really need to decide.
To be useful, the model needs to withstand scrutiny and relate directly to its intended audience.
If the target is investors or government, modelling needs to show outcomes like ROI, GDP impacts, taxation receipts, price impacts and macro employment levels.
If it’s the broader public, focus on what matters to them – will it lower prices, or will it create real jobs?
Understanding what matters to your audience should guide how you design the model and what outputs you focus on.
An economic model is only as good as its assumptions. The Garbage In, Garbage Out rule always applies – and the ability to defend those assumptions should be a core part of the project.
Checklist
- Is the model answering the right question for this decision, right now?
- Has it been shaped with the intended audience in mind – investors, regulators, government decision-makers, or the public?
- Are we using the model to inform decisions, not just defend them?
- Are the assumptions credible and easy to test?
2. Communicate what matters to your audience
Economic modelling often fails not because of the numbers, but because no one connects with the story. People don’t engage with assumptions or outputs – they engage with consequences. Will this create jobs? Reduce costs? Improve access? How does it compare to the alternatives?
That requires clear, consistent communication from the outset. It also means choosing framing that matches the values and interests of the audience – whether that’s economic growth, social equity, cost savings, or public trust.
Failing to communicate what the modelling actually shows – in a way that resonates – is a missed opportunity.
Checklist
- Are we framing results in ways people care about?
- Are we using visual tools that support understanding and trust?
- Are we tailoring the messaging for different audiences?
Understanding what economic models actually say and why that matters to your audience is critical. In working with clients in the resources sector, Orizontas has helped reframe modelling outputs to show local job creation – rather than abstract global metrics – to shift how projects are understood.
3. Offer solutions people can act on
A good model doesn’t just validate a decision – it helps people make one. That means presenting real options, not just one assumed path. It also means spelling out the implications: what’s being traded off, what’s uncertain, and what needs to happen next.
This is particularly important in public policy, where decision-makers must balance economic logic with political, social, and practical realities.
The best economic models are those supported by reports that clearly lay out real-world trade-offs – not those that assume away difficult choices. They help clarify what’s at stake and create the confidence to move forward.
Checklist
- Does the model offer real-world choices, not just technical outputs?
- Are trade-offs clearly laid out, not buried in assumptions?
- Do stakeholders walk away with confidence to act?
With Australia focused on a difficult energy transition, Orizontas is working with clients to effectively explain the trade-offs involved – and to frame what is politically and socially realistic, not just technically desirable.
A tool for clarity, not complexity
Used well, economic modelling can shift conversations, align stakeholders, and de-risk bold decisions. Used poorly, it becomes a tick-box exercise that adds complexity without clarity.
When planning your next modelling project, ask:
“What decision are we trying to inform, and who needs to believe in it? “
If you can answer that clearly, you’re halfway to building a model that works.
How Orizontas can help
We support executive teams, corporate affairs leaders and project owners to make economic modelling more useful and impactful – especially when the stakes are high.
Our support includes:
- Reviewing the scope, structure and assumptions of modelling engagements
- Translating technical outputs into clear, credible messages for government, investors or the public
- Developing options, trade-offs and scenarios that build trust and support decision-making
- Preparing leaders to communicate modelling outcomes with confidence and clarity
Whether you’re developing a business case, shaping a public proposal, or responding to scrutiny, we help ensure your modelling is designed to influence – not just impress.
About the author
Patrick Gibbons is a Partner at Orizontas with more than 20 years experience working at the intersection of policy, economics and business strategy.
He has been at the forefront of Australia’s climate policy development, advising both sides of politics as a senior staffer in federal and state ministerial offices. He played a key role in designing parts of Australia’s current climate framework and has since worked across the energy, resources and financial sectors on complex reform and investment decisions.
Patrick has led modelling and policy strategy projects for major organisations helping executive teams turn analysis into action – and communicate their decisions with clarity and credibility.
Contact Number: 1300 728 827
Email: patrick.gibbons@orizontas.com.au
Linkedin: https://www.linkedin.com/in/patrick-gibbons-orizontas/