Developing Future Forecasts: Navigating the Possibilities

Future forecasts are evidence-based predictions about what might unfold in the coming years. However, it’s essential to remember that there are always multiple possibilities, and the future is inherently uncertain.

The Art of Signal Selection

At the heart of effective forecasting is selecting the right signals. Signals are concrete, observable evidence in our current world that hints at possible futures. They can be specific products, policies, events, or experiences that indicate how things may change.

When evaluating potential signals, instead of simply asking, “Is this a good signal?” consider:

  1. What is this signal good for?
  2. Does it challenge assumptions?
  3. Does it expand the conversation?
  4. Is it specific and tangible?
  5. Does it spark ideas?
  6. Can it be combined with other signals?
  7. Does it tell a compelling story?

The most powerful signals make you question existing beliefs, introduce new perspectives, point to concrete examples, trigger your imagination about future implications, and evoke an emotional response or vivid mental image.

Crafting Compelling Forecasts

Signals alone, however, are not enough. To create robust forecasts, we need to synthesise these signals with broader trends and drivers of change. Here are some key principles for developing effective forecasts:

  1. Combine multiple signals and drivers to identify emerging patterns and possibilities.
  2. Develop several competing forecasts to explore a range of potential futures, not just one prediction.
  3. Focus on being prepared rather than being “right” – the goal is to expand your thinking and anticipate multiple scenarios.
  4. Consider implications and second-order effects, not just direct outcomes.
  5. Revisit and refine forecasts regularly as new signals emerge.
  6. Use forecasts to inform strategy and decision-making, not as a crystal ball.

The Importance of Multiple Forecasts

Developing multiple competing forecasts is crucial. This approach allows us to explore a range of possibilities and avoid being blindsided by unexpected developments. By considering various scenarios, we can better prepare for different outcomes and adapt our strategies accordingly.

The True Goal of Forecasting

It’s important to emphasise that the goal of forecasting is not to predict the future with perfect accuracy. Instead, the aim is to be prepared for various possibilities. By expanding our thinking and considering multiple potential futures, we can make more informed decisions and develop more resilient strategies. Effective future forecasting is a dynamic process that involves careful signal selection, thoughtful synthesis of information, and the development of multiple scenarios.