One More Reason to Listen to Your Pharmacist

Peter Drucker had an extraordinary track record when it came to forecasting, but he disavowed any clairvoyance. “I just looked out the window,” he remarked in a 1991 lecture. “I don’t predict.”

Indeed, much of the future is impossible to anticipate, so Drucker confined himself to anticipating the effects of “events which have already irrevocably happened.” The rise of “knowledge work” was one example.

All of which is a way of saying that sometimes our efforts to read tealeaves get too fancy for their own good. Sometimes it’s better to look out the window—or use Google.

It turns out that the CIA is discovering the same thing. Alix Spiegel of NPR reported last week that about 3,000 average Americans have been participating in something called the Good Judgment Project, an effort launched by three psychologists and members of the intelligence community. These people have been granted no access to special information but have been asked to make probability estimates about things like the stability of foreign governments or outbreaks of violent conflict. According to Spiegel, the Good Judgment Project may boast a better record than CIA analysts with top-secret clearance. One forecaster, Elaine Rich, a Maryland pharmacist, has such a good record at predictions that she’s in the top 1% of forecasters among 3,000.

“How is it possible that a group of average citizens doing Google searches in their suburban town homes can outpredict members of the United States intelligence community with access to classified information?” Spiegel asked.

In conversations with experts, two insights emerged. “First,” Spiegel explained, “if you want people to get better at making predictions, you need to keep score of how accurate their predictions turn out to be, so they have concrete feedback.” And, second, “if you take a large crowd of different people with access to different information and pool their predictions, you will be in much better shape than if you rely on a single very smart person, or even a small group of very smart people.”

Now, Drucker didn’t believe in throwing every decision open to the crowds. But he believed strongly in encouraging executives to draw out as many divergent takes on a situation as possible, pointing to the “variety of viewpoints, opinions and experiences which is needed for sound decisions.”

And he believed just as strongly in the importance of measuring results against forecasts. As Drucker wrote in Managing for the Future: “[John] Calvin and [Ignatius of] Loyola applied the most important principle in learning: that of feedback. In any key activity areas, the first step is to set down what you expect will happen. Nine months later, the actual results are examined and compared with original expectations.”

Evidently, what was good for CAI (Calvin and Ignatius) is good for the CIA.

How do you and your organization approach predicting and forecasting?