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How Good Were You at Predicting the Past?

How Good Were You at Predicting the Past?

One of the things I like about The Economist magazine is that, unlike most publications at this time of year, it doesn’t simply forecast what lies ahead, but evaluates the forecasts made last year. Were they accurate or not? Were they based on sound reasoning? Were they grounded in valid assumptions?
The application to business is that while It’s all well-and-good to look to the future and forecast opportunities and threats, what’s to say that’s anything more than just a guess? How would you know unless you looked back and evaluated how well you forecasted in the past? And if your past forecasting led you to make decisions, set goals and develop plans, then those efforts were largely wasted if your ability to forecast was poor.
The better you are at predicting the future, the better decisions you will make. Which leads to better goal-setting and more relevant plans. The way to get better at predicting the future is to assess how well you predicted it in the past, the soundness of your reasoning and the validity of your assumptions. Armed with those learnings, you can revise your model, your protocol for forecasting. And then after the following year, you assess and revise once again. That continuous loop of predicting, assessing and revising is what will improve your ability to forecast, make good decisions and set meaningful goals.
Yes, it’s good to look forward and attempt to predict the future. But it’s equally important to look backward and determine how well you predicted the past.
 
Make it happen.
 Michael
 
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