Thursday
Oct182007
How Well Can You Predict the Future?
Thursday, October 18, 2007 at 09:00PM
A recent article by The Numbers Guy in the Wall Street Journal reported a study where experts hardly improved on the prediction accuracy of novices:
The experts were right 32% of the time, barely beating out novices, who were right 29%, and random guessing, which should have yielded an average accuracy of 28%.
This reminds me of the report of the 9-11 Commission that in effect concluded that we suffered from a failure of imagination in predicting the events. It also brings to mind the range of overblown tech industry forecasts marketed by the "experts" prior to the collapse of the bubble, all getting caught up in the herd mentality and telling companies what they wanted to hear..
Prof. Armstrong published a paper titled The Seer-Sucker Theory: The Value of Experts in Forecasting in which he concluded: “No matter how much evidence exists that seers do not exist, seers will find suckers.”
Time and time again I have seen that a proper scenario planning process is much more effective than grasping a single view of the future. Put your faith in a rigorous and imaginative process, rather than an "expert".
The experts were right 32% of the time, barely beating out novices, who were right 29%, and random guessing, which should have yielded an average accuracy of 28%.
This reminds me of the report of the 9-11 Commission that in effect concluded that we suffered from a failure of imagination in predicting the events. It also brings to mind the range of overblown tech industry forecasts marketed by the "experts" prior to the collapse of the bubble, all getting caught up in the herd mentality and telling companies what they wanted to hear..
Prof. Armstrong published a paper titled The Seer-Sucker Theory: The Value of Experts in Forecasting in which he concluded: “No matter how much evidence exists that seers do not exist, seers will find suckers.”
Time and time again I have seen that a proper scenario planning process is much more effective than grasping a single view of the future. Put your faith in a rigorous and imaginative process, rather than an "expert".
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