Tuesday, January 10, 2012

My prediction for 2012

You likely know from my book "The Prediction Trap - and how to avoid it" or by hearing me speak that I think predicting the future is a dangerous idea. That's because once a person or organization has made a prediction, it is natural for them to look for information that supports that prediction and filter out information that contradicts the prediction.

Nevertheless, there is a prediction which I will make for 2012 which I think is not only safe, but helpful. That prediction is:

2012 is going to be unlike 2011 (or any other year from the past for that matter.)

I feel safe in making this prediction because the significant driving forces on the horizon all suggest scenarios in the economic, social, and political arenas that we have never seen before. No matter how these driving forces combine, 2012 will surely look different from past years.

I also feel safe in making this prediction because Mark Carney, the the governor of the Bank of Canada, also recently said similar things in a speech to the Empire Club/Canadian Club. (Jeffrey Simpson commented on this speech in the Globe and Mail.) Carney said that "current events mark a rupture" in the world economy and described in a very frank manner the situation around the world and the uncertainties that exist for the world economy.

I also believe that unlike most predictions, the prediction that "2012 will not be like the past" is a helpful one. If you use this prediction as a guiding principle, then both at work and in your personal life you will not get stuck in "The Prediction Trap." You will continuously question your assumptions, that part of your filter that - while maybe accurate from the point of view of the past - may prevent you from seeing changed circumstances.

Change is a challenge for most people, not because they don't "like" change, but because it takes effort to develop a skill, a process, or an opinion. Change means we need to learn new things, and new ways of behaving, and that takes effort.

But change also offers an opportunity for those willing to invest the effort in dealing effectively with change. We have seen bad decisions from governments in Europe, the U.S., and Canada and from businesses as well worldwide. Many of these this bad decisions were based on the hope that the clock could be turned back, that things could be put back to "normal," where normal looks like the past.

I think there is still a lot of this magical thinking going on; ideas such as borrowing one's way out of debt, or expecting an economy to grow while at the same time introducing severe government cutbacks, or hoping consumers will both save more and spend more at the same time. In fact, the overriding magical thinking in many of these decisions is the idea that growth of anything can continue forever.

So 2012 will be different - you can take that to the bank (though they may not want to hear it.) How will you prepare for 2012?


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