The Thing about Predictions


The annual onslaught of outlooks, predictions, and top-risks lists is upon us along with the beginning of a new year. As I begin the process of sorting through them and compiling my annual “Top Gray Rhinos” meta-list of the things that collectively keep CEOs, policy makers, and top analysts up at night, I’m reflecting on the nature of predictions themselves.

Why do we make predictions?

Looking at potential scenarios is, of course, an important planning tool. The exercise provides a chance to evaluate possible courses of action while we’re level headed and not under stress. Decisions we make when we’re not in the heat of the moment—the “panic” stage of a gray rhino event when people demand leaders to do something, anything at all—are much more likely to end up being the wrong choice if there’s not a well-reasoned plan in place ahead of time.

Predictions also are a way to feel more in control—however much an illusion that control may be—of an uncertain future. The University of Chicago economist Frank Knight famously distinguished between uncertainty —the possibilities to which we cannot plausibly assign probabilities—and risks, or the possibilities for which we have some basis that allows us to guess how likely they might be.

Assigning a probability turns an unknowable uncertainty into a risk that fits more comfortably into our mindset. Whether or not our forecasts end up being right, the very act of making them changes the dynamics of the situation. When we feel more in control, we feel more confident.

The assumptions and intentions behind your predictions matter. Are you just trying to get it “right” or are you scanning the horizon more broadly for potential scenarios you have not yet considered but should? Certainly, analysts who get things right use their correct calls as marketing tools and reputational burnishments (and perhaps a little joy at saying “told ya so”). Others use brash but outlandish predictions as ways to get attention and count on people forgetting they were wrong.

If you’re playing it safe, you look at what everyone around you is predicting and go with that. When you’ve made the same prediction as others, you won’t stand out so much if you get it wrong.

That’s why one of my favorite annual lists is Blackstone’s Top Ten Surprises. Its very premise is to challenge prevailing wisdom and thus to scope out possibilities that the Usual Suspects (ie the herd of Wall Street analysts) have not identified.

Thinking about what others are thinking is quite useful: it’s a way to identify possible areas of Groupthink, or confirmation bias. For investors, it’s also a tool for analyzing which assets might be over- or under-valued.

When the year is done, Top Surprises authors Byron Wien and Joe Zidle look back over the surprises they identified twelve months earlier and see what panned out and what didn’t. Wien started the list 35 years ago to identify events that the average investor would only assign a one out of three chance of taking place, but which he believed were “probable,” which he defined as more than a 50-50 chance of happening. That definition pushes the list beyond the typical top risks lists.

It’s important to check in every once in a while to check your prediction assumptions. This helps you to adjust mid-stream if you need to. But it’s also a way to hold yourself accountable. Which predictions panned out, and why or why not? Was the assumption flawed in the first place? Did an unexpected event change the course of things? Or did people with the power to avert an obvious danger do what needed to be done to avert it?

For policy makers or issue advocates, these lists are a way to hold themselves and others accountable. If a risk was known and decision makers didn’t act appropriately to avert it, they need to be called out for it. Way too often, when leaders claim they didn’t see something coming, that’s not true: they saw it coming and downplayed, neglected, or outright ignored it. It’s time to stop letting them get away with it.

Checking your assumptions also is a great way to get comfortable with being wrong. If you’re right all the time, you probably aren’t casting your net wide enough –and thus are more likely to be missing important possibilities that should be on your radar.

Do you have your own predictions of what’s going to happen in 2020? What are you doing about them?

This article is part of my new LinkedIn newsletter series, “Around My Mind” – a regular walk through the ideas, events, people, and places that kick my synapses into action, sparking sometimes surprising or counter-intuitive connections. 

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Michele Wucker

About Author

Michele Wucker is a global thought leader and the author, most recently, of THE GRAY RHINO: How to Recognize and Act on the Obvious Dangers We Ignore (St Martin's Press, 2016). Learn more about her at

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