Forecasting: Why Knowing What's Next Could Be Your Downfall

FORBES | David Stuart, Contributor and Todd Nordstrom, Contributor

Looking down from the 8th floor of the City Center Marriott in Salt Lake City, we couldn’t help but notice a young couple as they stumbled across a downtown skating rink. Both were obviously unsure about their next step on the ice. And yet, both seemed to be thoroughly enjoying their own uncertainty—either wobbling across the rink on steel blades, or gliding across on their tailbones—and having no clue what would happen next.

Unlike this couple, it seems we all want to know what will happen next. To try and fill the future void, it’s easy to become obsessed with trends, forecasts and predictions. We assume that with enough future insight, we’ll be able to make the right decisions. For many, forecasting using trend data can be a helpful risk-management practice. However, with increasing market volatility and global uncertainty, many entrepreneurs feel like they are moving on ice—hoping their next step isn’t the one that lands them face-down.

More often than not, long range forecasts simply create a false sense of security because they rely so heavily on a continuation of the status quo. Historical assumptions lull the forecaster into a future picture that looks very much like the past. These historical assumptions cannot fully account for changing market dynamics or for the natural and inevitable evolution of value. Plus, we have to ask ourselves: whether we’re stumbling across an ice rink, riding a roller coaster, or taking our business to market, are we diluting the thrill, enjoyment, and lessons-learned from adaptability?

A Washington Times article, written by Patrick Hruby noted, “According to research on the psychology and efficacy of predictions, long-term expert predictions have been found to be about as accurate as monkeys tossing darts at a board labeled with potential future outcomes.” The article continues to discuss not just inaccuracies in the Global Trends Reports, which are created by the National Intelligence Council, but also examined complete oversights. For example, the report created in 1997 that was forecasting life in 2010, made no mention of the decimating impact of a financial crisis in 2008.

The more we rely on predictions and assumptions of what we think will happen next, the less agile we become, and the less in tune we are to subtle changes occurring around us. When people are sure what they think is coming next, they look for evidences that support their view and become blind to facts that may challenge their perspective. It’s human nature.

Still, it seems that some people and organizations look like they know what’s going to happen next—they seem to always be on the leading edge, one step ahead of their competitors. At the same time, others (even with heaps of data, knowledge and testing) seem to head off in the wrong direction. What does one group know that the other does not know?

Ironically, it’s not all about your ability to predict the future, it’s about what you do to influence it. According to The Great Work Study, a cooperative research effort between the O.C. Tanner Institute, Forbes Insights, and the Cicero Group, that studied nearly two million cases of award-winning work, found that people who win awards for their work don’t seem to spend much energy on thinking about what’s coming next. Instead, they focus on figuring out what people will love.

The study also found that certain skills practiced (not predictions or forecasting prowess) led to a significantly greater probability of success. These actions or skills generate new ideas and fresh thinking that enable them to outperform their peers, and help them shape their own future. Some of these skills include:

1. They pick other people’s brains. 72% of projects that get recognized for outstanding results include people talking to others in their outer circle—people who don’t have similar backgrounds, disciplines, or even expertise.
2. They ask more questions. People who are awarded for their work ask a lot of questions like: “why does this take so long?” or “what if we could…?” “what would they really love…?”
3. They go and see how people respond to their work. Employees who go and see a problem first hand are 17 times more likely to be passionate about finding a solution.
4. They don’t give up. 90% of award-winning work projects include employees who remain involved after implementation.

The truth is, none of us can know what comes next—in life, or at work. However, the people who are continuously successful are those who focus on creating a difference for their customers, and finding ways to do things that people love.

As we watched the skating couple enjoy their uncertainty on the ice, one thing became very obvious. If they had known about the bumps, and the bruises, and the fears, they would never have chosen to be on the ice. And, they surely wouldn’t have been smiling.

This article was written by David Stuart and Todd Nordstrom from Forbes

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