The future was never what it used to be

Companies like Garner and IDG were seen as essential when I was running a Mac software company in the 80s and 90s: we couldn’t afford their $3000-5000 forecasts, and so eagerly sought out insights when they were excerpted elsewhere. Then, after I became an academic, I researched platform standards wars — first in PCs and then in smartphones — I worked to reconstruct their market share statistics while looking cautiously at their forecasts.

Alas, 2016 showed that (as Yogi Berra famously said) the future ain’t what it use to be. As my Wall Street Journal proclaimed this morning:

CEOs Put Less Stock in Predictions
Executives’ faith in expert forecasts fades as uncertainty grows; Brexit is latest jolt.
By Rachel Emma Silverman, Joann S. Lublin and Rachel Feintzeig
Wall Street Journal, July 13, 2016, p. B6

The forecast for business predictions these days is cloudy.

Chief executives tap consultants, expert prognostications and polls about market and political conditions to help inform business decisions. But from the Brexit surprise to the rise of Donald Trump and the frequently revised U.S. job market numbers, expert analyses have been landing far off the mark—and executives are growing wary.
…
“The so-called experts and global economists are proven as often to be wrong as right these days,” says Scott Wine, chief executive of Polaris Industries Inc., a Medina, Minn., manufacturer of off-road vehicles and motorcycles.
…
Mr. Lamneck [CEO of Insight Enterprises] says he is more closely scrutinizing the research that the company buys from advisory firms like International Data Group and Gartner. “We’ll look at, ‘What’s the real value of these services that we’re paying for?’” he says, adding that the reports are more useful for strategy ideas than for market-growth forecasts
.
A study of about 28,000 expert geopolitical predictions over 20 years [from 1984-2003] found that most were only slightly better than chance, especially when predicting events more than a year off would or wouldn’t happen, according to Philip Tetlock, a professor at University of Pennsylvania’s Wharton School of Business who studies forecasting.
Dr. Tetlock suggests businesses carefully track both internal and external forecasts and keep score on who gets the important calls right—a step that few companies take.
…
[CEO Robert S. Miller] and fellow directors [of International Automotive Components Group] review corporate strategy quarterly, and Brexit’s effect will be on the agenda for their July 27 review. Mr. Miller says the referendum’s result will only add to the complexity his company faces.

Still stung from his experience in 2008 [as CEO of Delphi], the IAC leader says he places little stock in current economic predictions. He is equally skeptical about predictions describing future effects of the Brexit vote.

“You always have to take this stuff with a grain of salt,’’ Mr. Miller suggests.  “You can’t run your business with only one track in mind—which is the direction that forecasters and experts are telling you it will go.’’

Or as physics Nobelist Neils Bohr reportedly said: “It is difficult to predict, especially the future.”