Forecasting ... a Tricky Business
Last month my headline was " '05, The Year Wireless Goes Mainstream." I, more or less, said I was going out on a limb and viewing this as a prediction.
Well, we'll see if I'm right or wrong. In this month's column, I was thinking about making another risky prediction (stay tuned, it's coming next month), but during the process I got to thinking (to my publisher's chagrin) because I'd recently been asked to discuss MY opinions about the future and direction of wireless.
I've been in electronics, and later, high-tech, since I stuck my finger in an empty light socket when I was about oh ... maybe seven or eight. Most kids would learn a lesson from that, but no, I had to do it again, just to make sure the same thing would happen ... duh. But, it set my life's work. So, I've got a pretty long history of experience in electronics and related technology.
Now, where I'm going with this is that I have made decisions to go into different areas of technology because I thought they had a future. In a roundabout way, I was forecasting (of course, I had a direct connection to Karnak, after that childhood episode) based upon what I know — SOME of which came from expert opinions, but not much. I've been pretty lucky. The decisions I made were good. I got in at the right time and out at the right time.
But what got me off on this topic was a report that I'd just been sent (one of many) forecasting wireless trends for 2005. So I thought I'd do a bit of research and make a column out of it.
Of late, say since last November, the amount of data I've been getting about business and consumer wireless, all arenas, predicted to go mainstream, has been voluminous. Not a day goes by when I'm not sent a report (that they want thousands of dollars for) by some industry analyst that has the inside track, insider information, numinous intuition, or psychic contacts that tell them this or that, or something else is going to explode, erupt, or become ubiquitous.
These reports present a dizzying array of numbers, pie charts, graphs based on past data showing future growth generated by statistical analysis, Stochastic theory, and so on.
Recently I got an email from one of these analysts stating "My batting average over the last few years has actually been over 70%" ... 70%??? Wow, hope my neurosurgeon has a better batting average. If I were betting in Vegas that means for every $100 I play, I get $70.00 back. Funny, when I look at it that way, the odds don't seem too good.
But, back to my neurosurgeon. The last time I went in for some R&R on a broken body part, he told me he was 95% sure I tore the labral tendon in my right shoulder. If he would have said 70%, I've got to think I would have been much more apprehensive about whether he knew what he was doing. The saving grace with the surgery is that once the doc goes in, he gets a bit of a clearer picture of what the situation is. Nothing changes on the fly. If the labral tendon is shot, he fixes it. If the rotator cuff is shot, he can fix it while he's in there as well.
Well, one can apply a similar philosophy to the high-tech forecasters, but the problem with technology is that it is a moving target. Even though development times have been significantly reduced, due to things like standards-based technologies, if one puts all of their eggs in the WiFi basket, based upon "forecasts," which are, at best, educated guesses, it's still a less than desirable odds gamble, IMHO (remember when the visionaries were forecasting Bluetooth to be everything to everyone?).
For me, for example, during the mid '90s when I was doing a lot of corporate training in software development, I didn't have the luxury of learning ten different programs and counting on seven hitting. And, don't forget it's not like there are always ten options. Sometimes there are only one or two and the whole enchilada rides on the forecast being right.
The real issue here is that if you buy into the forecast, you have a 70% average chance of being right. But what if the technology takes the road that is in the 30% wrong — especially for something like betting the farm on 2005 being the year wireless goes mainstream. This isn't a seven out of ten option. If you buy into the forecast and '05 isn't the year wireless goes mainstream, you're up that proverbial creek without the paddle.
One can also argue that out of ten products, seven will be successful. Well, if the seven successes cover the three losses, with something left over, then I suppose it can be considered a success and the forecast percentage is acceptable, and worth it. But for me, seven out of ten successful magazine issues isn't good enough. So, I guess from some perspectives, 70% is acceptable, from others, it isn't.
Finally, what is the measure of success? In today's world of tight budgets, JIT inventory, world economies, and any number of other mitigating factors, it just seems that forecasting is a risky business — both from the expert's perspective as well as the benefactor's — especially 70%.
Wireless Design & Development
Advantage Business Media
Rockaway, NJ, 07866
© 2008 Advantage Business Media
|
