Financial managers got it wrong.
As a group they confidently expected a “yes” vote in Greece. Hardly a triumph of peering round the corners of the future. They joined the shamed pollsters of the UK’s recent general election, in which all the main poll services failed miserably to predict the result, despite years of refining their methods. Predicting the future is a mugs game, yet we all try to do it. It’s part of human nature to stare into the misty years ahead. Yet not everybody falls flat on their face trying to predict the future.Nearly 200 years ago, Francois-Rene de Chateaubriand described his nineteenth century changing world: Even more impressively, he predicted society is “ threatened by the spread of intelligence”. He argued this might lead to people “being condemned to idleness” as a result of advances in technology. This was hardly foreseeing the internet or the digital revolution. Yet it got close. Chateaubriand went on to describe a “single universal mercenary matter”, which today might translate as artificial intelligence (AI) and robotics. A consequence he said, would be work might cease to have real meaning for people. This would put serious strains on holding civilisation together. We already have something of a crisis of meaning at work. Burnout has long been a concern, with symptoms now all too familiar: exhaustion, detachment, boredom and cynicism, impatience and heightened irritability, a sense of omnipotence—“No one else can do it. Only I can”, paranoia, psychosomatic complaints, depression, and denial of feelings. The meaning we attach to work is tied to our attitude to the work we do. The vast array of studies on lack of engagement at work are testimony to a severe loss of meaning and alienation. Considerable efforts are now going into transforming engagement in various countries and in proactive companies. Yet countervailing forces seem bent on making it harder to sustain meaningful work. These include the digital revolution, globalisation, and technological advances, including robotics and AI. As Chateaubriand looking ahead in the mid nineteenth century implicitly asked
“Will work lose its meaning entirely?”
The job of Leaders
To some extent all business leaders must be visionary and also peer around corners to predict the future. Somehow, they must develop a picture about what their company is trying to achieve and where they want to get to eventually. Ethical leaders don’t have to predict the future. Instead, they need to be driven by strong values to define the sort of future they want to see. As Abraham Lincoln reportedly put it: The best of them learn to connect the dots that seem disconnected to others. This isn’t magic, or some supernatural phenomenon. You can learn to “foresee” the future, if that is what you most earnestly want to do. Proof this is possible comes from a lengthy and intriguing study called the Good Judgement Project. Launched in 1987 by a young Canadian-born psychologist, Philip Tetlock took thousands of predictions about the future by so-called experts and then waited patiently 18 years to see if they came true. Tetlock discovered most experts were indeed poor at predicting the future. “Chimps randomly throwing darts at the possible outcomes would have done almost as well as the experts,” is how one political scientist summarised the findings to the New York Times. You might therefore conclude forecasting events is basically impossible. The results of the Good Judgment Project show this is wrong. Forecasting is possible, and some people – call them “Super forecasters”– can predict geopolitical events with an accuracy far outstripping chance. These super forecasters have been able to sustain and even improve their performance. Most forecasters though are not actually single-minded at trying to see into the future. If they were what would they do? “Keep score” says Tetlock, and constantly try to improve predictions based on past errors. Some participants in the Good Judgement Project were given advice on how to transform their knowledge about the world. The first step was to keep score. The second was to stop using a simple prediction, and instead make a guess about the chances of something actually happening. This is probability forecasting, and has been widely used ever since. It was building on the earlier attempts to turn forecasting from an art into a science, which began around the start of the cold war in the middle of the last century. The Delphi method was developed by the Rand Corporation and is often used today with various modifications. It originally asked experts to give their opinion on the probability, frequency, and intensity of possible enemy attacks. Other experts could anonymously give feedback. This process was repeated several times until a consensus emerged. Tetlock went much further, creating what has become known at the CHAMP method. This consists of five basic principles for being a Super forecaster: If leaders want to become better at preparing for the future, the Tetlock findings are important. Not only do the best forecasters tend to score better on measures of intelligence than others. They also share one other important trait that should resonate with ethical business leaders: they were all open-minded. It’s easy to dismiss being open-minded as soft or woolly thinking. But in essence it comes down to how you deal with uncertainty. Open-minded ethical leaders will be more likely to see problems from all sides—not for them the black and white ethical dilemmas approach of “it’s obvious what the right decision should be.” Open-mindedness helps a leader to see problems from all sides and can help overcome their preconceptions in the light of new evidence.
“You need to change your mind fast, and often,” says Tetlock.
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