Whether we like it or not, we’re all in the business of predictions. It’s not just economists who predict future interest rates, or pollsters who predict election outcomes, or investments analysts that predict a company’s EPS. We know these types of predictions are difficult and can be unreliable, but as much as some people would claim otherwise, we can’t avoid making predictions. To manage risk, companies need to make predictions about what events could take place, super funds need to make predictions about what investment strategies will succeed, and financial advisers need to make predictions about how clients will respond to different service offerings. We’re also making predictions about ourselves, such the age at which we might want to retire and how long we might live. We will inevitably get these things wrong. But how can we predict better? How can we make predictions that are more useful? In this session, Stephen Huppert and I discuss: 1. How different types of thinking about the future suit different scenarios. 2. The tricks and traps of scenario analyses. 3. How and when to assign probabilities. 4. Whether Bill Gates is right about predicting the future. 5. What we can learn about prediction from the Bladerunner movie.

Ask this episode

“What did the council decide on item 42?” — answered with the speaker and the moment.

Transcript

Related