Chapter 1- Predicting the Future by Looking at the Past

For over twenty-five years now – in my “day” job of analytics and business forecasting – I use past results and forecast outlooks to predict future actions and events every day. I have thrived in the corporate world by observing patterns and correlations in events and attempting to explain – not necessarily “why” something occurred – but “what” might occur next. Most times – whether people realize it or not – I am far from alone in these pursuits.

While they may not get paid to do so, most people generally try to anticipate what is going to happen in their lives.  Of course, the majority do not fully understand the statistical probabilities or potential forecast elements involved. Regardless, they still spend their time guessing what might happen tomorrow or prognosticating to their peers about the future – even if it is just which team will win this Sunday’s game.

We all make these guesses, but what if we could see into the future? Would you not want to “peer under the shroud” and see what was to come? I am not talking about learning the next winner of the Super Bowl or Lord Stanley’s Cup, but more like knowing what type of culture shifts we will see in the coming years.

This is actually not much different than forecasting the sales of widgets that a company is going to hit next quarter. To do this, I would look at historical results for recent months and years – as well as other market indicators and demand drivers – and then (through the magic of some pixie dust…and mostly statistics) I would develop a picture of what the future of sales will look like. The key is to look at enough relevant data and enough history to begin to see patterns. Patterns such as summer sales increase by 22% each year due to seasonality or a summer selling season. Or – if you have a product with a life cycle of forty months – we begin to see sales decrease at an increasing rate after that time has passed. Maybe we see indicators that tell us that an increase in home sales correlates in ninety days to a corresponding increase in sales of our product.

Do these same patterns exist in the world at large? Can we glean them to see more than sales but also the impending changes in cultural moods and attitudes or even forecast the probability of major world events? If so, the key would still be to look at enough relevant data and enough history to begin to see patterns.

This is what I decided to do – in my spare time away from that day job. I started looking objectively at history and gathering as much data as I could find.

Over the years, I have come to realize a few things about myself. One, I am obviously not normal. Two, I really should find a better way to enjoy my time away from work. But lastly, I have also realized that I have a disposition that takes joy in finding the relationships in seemingly unrelated things and an acute ability to sort through the ambiguity and messiness of those things down to their root cause and effect.

In addition to this, the future and the past fascinate me, and I am the kind of person who grasps the connectivity of seemingly unconnected events and loves to peer over the horizons. This has suited me well, and I have parlayed it into over two decades of “on-the-job training” through a fulfilling career in analytics, big data, and business forecasting.

My passion for connections and predictions permeates my personal life as well. This book has become the intersection of my professional and personal background and skills with my worldview and love of history. It might sound overly complicated at first, but let us try a quick little experiment together to demonstrate how simple some of these concepts can truly be.