Forecasting the Future

Despite all of the philosophers past and present urging us to “live for the moment,” most folks just seem to be more interested in the future. The past? Forget about it. The present? Who’s got time? The future? Bingo! Now you’re talking. So tell me, what’s going to happen tomorrow so I can make all the right moves today?

Humanity’s intense interest regarding the future has kept countless soothsayers, fortune-tellers and astrologists busy for centuries, but basing predictions on the alignment of the stars is akin to tossing a coin: you’re wrong as often as you’re right.

Perhaps no one is more interested in the future than corporate officers whose company’s success – and perhaps their jobs – depend on their ability to make the “right” business decisions “going forward.” Until fairly recently, C-level executives made these critical decisions based on personal experiences, intuition and what their “gut” told them. Unfortunately, their “gut” was about as reliable as tossing a coin.

Thanks to the explosion of data and the analytics to derive insight from it, virtually every enterprise now has the ability to see more clearly into the future than ever before. As Andy Boyd points out in introducing a trio of cover stories of the subject, forecasting is “one of the most powerful and widely used tools by analytics professionals, and rightly so” because “good forecasts lead to better decisions.”

Of course, predicting the future remains tricky business, even in the age of analytics and data-driven decision-making tools like forecasting. Boyd, for example, points out the myriad barriers forecasters typically encounter in a corporate setting and how to overcome them in order to achieve forecasting’s full potential (page 8).

Next, co-authors Michael Gilliland and Udo Sglavo list the “worst practices in business forecasting” (page 12). It’s not a pretty picture, but it provides valuable insights for any forecaster whose forecasts, as the co-authors put it, “never seem to be as accurate as we would like them to be – or need them to be.” Jack Yurkiewicz wraps up our forecasting features by addressing perhaps the toughest question a forecaster can face: With so many forecasting products to choose from, which one is right for me (page 18)?