Forecasting in Business

Forecasting and predictions in the business world can make or break a company or even an industry. There are several steps that a company can use to help predict their future needs (Amanet, 2019). These steps include looking back at trends, anticipating what is to come next, and directing your own future (Amanet, 2019). These are important steps that the fuel industry could have taken over the last 100 years. There have been many scientists dating back to their early 19th century, with a well-known infamous prediction by Alexander Graham Bell, that spoke of climate change and global warming (Crew, 2017).

Infamous Prediction
Alexander Graham BellThere has been a lot of prediction over the years that have come true. One infamous prediction was from Alexander Graham Bell in 1917 when he predicted global warming (Crew, 2017). Back in the early 1900s, most scientists believe that the earth would cool down due to pollution since the sun Rays will be blocked (Crew, 2017). Alexander thought the opposite and correctly predicted that adding pollution into the atmosphere would cause the greenhouse effect, or as he stated it, the “hot-house” effect (Crew, 2017). Even though some historians will not credit Mr. Bell for being the first to use the term “greenhouse,” there is a consensus that he was ahead of his time (Williams, 2017).

It is worth noting that Mr. Bell was not the first to think about global warming before it was an issue. Back in the 19th century, scientists began speculating how burning coal was affecting the planet (Sakimoto, 2018). One thing the earliest scientists cording correct about with the amount of time it would take for carbon dioxide to build up in the atmosphere (Sakimoto, 2018).  Early predictions showed that it would take almost 3000 years before we needed to be concerned about global warming (Sakimoto, 2018).

There are various forces that come into play when we talk about global warming and the greenhouse effect. One major force in the cultural need to use fossil fuels to power vehicles around the world (Sakimoto, 2018). As a global society, we rely on fossil fuels to power everything from our vehicles, generators, electrical plants, and our homes (Sakimoto, 2018).

Another force that has an impact on global warming is the lack of social awareness and what can be done to correct the issue (Adio-Moses & Aladejana, 2016). A study was conducted in 2016 of people who lived within the industrial areas of Nigeria, which showed there was a lack of awareness for global warming (Adio-Moses & Aladejana, 2016). One idea to improve awareness is to introduce environmental health classes to teach individuals about the causes and dangers of global warming (Adio-Moses & Aladejana, 2016).

In summary, there is enough evidence that global warming and climate change are real. Now in 2019, we have energy-efficient vehicles that are starting to take the place of standard combustion engines. However, if the fuel industry used historical information dating back to the 19th century that showed climate change could potentially be an issue, we may have come up with cleaner fuel solutions sooner. This is a good example of an industry that is not looking at historical information for forecasting business needs. History is a great teacher, and if we do not look back to understand the past, we may end up repeating it.

References

Adio-Moses, R., & Aladejana, J. A. (2016). Assessment of knowledge and awareness of global warming among inhabitants of industrial areas of an urban community in Nigeria. International Journal of Business and Economic Development (IJBED), 4(1).  Retrieved from https://www.ijbed.org

Amanet. (2019). How to Predict the Future and Transform Your Business. Retrieved from https://www.amanet.org/articles/how-to-predict-the-future-and-transform-your-business/

Crew, B. (2017). Alexander Graham Bell’s Prediction About The Future Was Eerily Accurate. Retrieved from https://www.sciencealert.com/alexander-graham-bell-s-prediction-about-the-state-of-the-world-today-is-eerily-accurate

Sakimoto, P. J. (2018). Climate Change and Integral Ecology. The Trumpeter, 34(1), 62-78.

Wade, W. (2012). Scenario Planning. Retrieved from vbk://9781118237410

Williams, D. (2017). Alexander Graham Bell’s predictions about the impact of climate change. Retrieved from https://www.outdoorrevival.com/featured/alexander-graham-bells-predictions-impact-climate-change-possible-solutions.html

Scenario vs. Traditional

Today I would like to explore the similarities and differences between scenario planning and traditional forecasting. We will begin by first defining both scenario planning and traditional forecasting, then look at comparing the two.

Scenario Planning
Scenario planning is the idea of exploring a decision that could have multiple outcomes and examining the different outcomes at the same time (Ogilvy, 2015). Of all the different outcome possibilities, Ogilvy (2015) says it is best to select two to five different possible outcomes to examine at the same time, with an optimal number being four. One important key is that each organization will need to develop their own set of scenarios that fit the circumstances they are dealing with (Ogilvy, 2015).

As an example, a company may want to examine the different outcomes if they acquired a competitor. Outcomes could range from taking over the market to future cash flow issues due to the acquisition. A committee is convened to explore the possibilities and determine which outcomes should be explored in-depth (Ogilvy, 2015). The exploration of the various outcomes can take time, which is why scenario planning is used for long term planning (Ogilvy, 2015).

Traditional Forecasting
Traditional forecasting is utilizing historical information such as sales reports to project what the future will hold (Performance Canvas, 2018). Traditional forecasting would be ideal for a world that has little to no change; unfortunately, we do not live in that world (Wade, 2012). Normally, traditional forecasting is used for year-to-year projections and is not good for long term planning in the real world (Performance Canvas, 2018). One of the downfalls of using traditional forecasting is that it relies on historical information and can have a rigid workflow (Performance Canvas, 2018).

For an example of traditional forecasting, a manufacturing company may need to know how much raw-material to order for the next few weeks. The company could look back at recent orders to gain an understanding of how many units they may want to produce and calculate how much raw-material they need. As stated above, this type of forecasting would be great in a consistent world with little to no changes (Wade, 2012).

Compare & Contrast
From the two overviews above, you can see these are radically different approaches to predicting and planning for the future. On the one hand, you have traditional forecasting that works well when your business does not change. However, in today’s market, all companies need to be flexible and open to change. On the other hand, we have scenario planning, which is ideal for long-term planning, but the process would take too long to be useful for short-term decisions.

Ideally, you would employ a mix of both in your company. Using traditional forecasting to make short-term decisions, such as how much stock to order for the next few weeks, and scenario planning to help drive your company for the next ten years. Much like everything else in life, planning is a balancing act, and there is no right or wrong answer that fits everyone.

References

Ogilvy, J. (2015). Scenario Planning and Strategic Forecasting. Retrieved from: https://www.forbes.com/sites/stratfor/2015/01/08/scenario-planning-and-strategic-forecasting/#1d604f73411a

Performance Canvas (2018). Live forecasting vs traditional forecasting vs rolling forecasting. Retrieved from https://www.performancecanvas.com/live-forecasting-vs-traditional-forecasting-vs-rolling-forecasting/

Wade, W. (2012). Scenario Planning. Retrieved from vbk://9781118237410

Accidents Happen

We all make mistakes, and we all have accidents throughout our lives. Mark Twain is quoted as saying, “Name the greatest of all inventors: Accident.” But what happens when accidents turn into a great discovery? Here, I will examine two accidental inventions that are considered revolutionary and helped change the way we live. There are a number of accidental inventions that fit into this category, but I will be focusing on the discovery of the X-ray and the first practical implantable pacemaker.

The X-ray
The X-ray was discovered by a German physicist by the name of Wilhelm Conrad Röntgen in November of 1895 (Panchbhai, 2015). Wilhelm requested that all of his research papers be destroyed after his death, and therefore the exact details leading to the discovery of the X-ray are unknown (Panchbhai, 2015). It is widely believed that the discovery came when Wilhelm set down an experiment involving a new electronic tube on top of a book in his laboratory.

Under the book on which Wilhelm placed his electronic tube sat a photographic plate that Wilhelm used in his camera. Wilhelm later used that photographic plate in his camera, and after developing the plate, he was surprised to find an image of a key. Wilhelm searched through the book that had been between the experimental tube and the photographic plate to find a key within its pages (Panchbhai, 2015). After this event, Wilhelm studied the new phenomenon day and night for weeks on end in his laboratory (Panchbhai, 2015). On December 22, 1895, Wilhelm took the first X-ray of his wife’s hand (Panchbhai, 2015).

Since December 1895, countless X-rays have been taken around the world and have helped several medical professionals perform diagnoses, such as in a triage situation (Yang, Ye, Ding, Zheng, & Zhang, 2016). Without the discovery of the X-ray, we would not have one of the most widely used medical diagnostic tools in use today. It is safe to say Wilhelm was not the first person to view the power of the X-ray, but without his research scientists would not have been able to identify the phenomenon.

The Pacemaker
The pacemaker is the most common device used to treat patients with slow heart rhythms (Cingolani, Goldhaber, & Marbán, 2018). Over 200,000 patients in the United States each year receive a pacemaker implanted for their heart rhythm issue (Cingolani et al., 2018). In the 1950s, a pacemaker was a large external device that needed to be plugged into an outlet for it to operate (Kermode-Scott, 2011). What is ironic about Wilson Greatbatch’s accident is that he was not even trying to invent the implantable pacemaker, but rather he was working on a device to monitor the sounds of the human heart (Kermode-Scott, 2011).

It was while working on his monitoring device that Wilson accidentally picked up and installed the incorrect resister. After powering on the device, it produced a pulse that was similar to a heartbeat (Kermode-Scott, 2011). After this remarkable discovery, Wilson quit his regular job and dedicated the next two years to develop the new pacemaker (Kermode-Scott, 2011). In 1960 Wilson Greatbatch received a US patent for a cardiac pacemaker and in 1961, Medtronic purchased the rights (Kermode-Scott, 2011). The first human to receive a pacemaker designed by Wilson Greatbatch lived for 18 months after the operation (Cingolani et al., 2018).

I focused on these two accidental inventions due to their link to my own research. I am working on non-medical implantable radio frequency identification (RFID) tags I have already used the power of the X-ray. After my first implant, I had an X-ray done on my hand to document the location of the implant. I personally I do not need the use of a pacemaker, but I have used information related to medical implants such as the pacemaker to understand better the process of how implants are used. My other important take-a-way from these accidents is that everything is worth trying. You don’t know what could work until you try, so don’t be afraid to fail.

References

Cingolani, E., Goldhaber, J. I., & Marbán, E. (2018). Next-generation pacemakers: From small devices to biological pacemakers. Nature Reviews. Cardiology, 15(3), 139-150. doi:10.1038/nrcardio.2017.165

Kermode-Scott, B. (2011). Wilson Greatbatch. BMJ : British Medical Journal (Online), 343. doi:10.1136/bmj.d6765

Panchbhai, A. (2015). Wilhelm conrad rontgen and the discovery of x-rays: Revisited after centennial. Journal of Indian Academy of Oral Medicine and Radiology, 27(1). doi:10.4103/0972-1363.167119

Yang, L., Ye, L.-g., Ding, J.-b., Zheng, Z.-j., & Zhang, M. (2016). Use of a full-body digital x-ray imaging system in acute medical emergencies: A systematic review. Emergency Medicine Journal : EMJ, 33(2), 144. doi:10.1136/emermed-2014-204270

A Thought on Think Tanks

In this post, we will look at what a think tank is, and what makes them valuable today. We will also look at some of the different methods used by think tanks to garner success. There is controversy around think tanks and if they do good. Although this post will not try to solve such a complex problem, it is important to understand such problems exist.

A think tank is an organization that reads literature, conducts experiments, and publishes research to help influence change or expand understanding (Hauck, 2017). You can think of a think tank as a research university without the students (Hauck, 2017). A think tank should remain neutral and not accept funding from a government agency or have connections to other social interest groups (Hauck, 2017). According to Hauck (2017), around 75% of German think tanks in Western Europe are financed by the government, and nearly all think tanks in Japan are connected to the government or industry in some way. Other think tanks that are not linked to the government can obtain funding through donations from individuals or private organizations wanting to fund research (Hauck, 2017).

After several years working for and helping to build the Center for Global Development (CGD), MacDonald and Moss (2014) published a paper detailing twelve of the top lessons they have learned. All twelve of the lessons learned are valuable; however, I would like to focus on two that I gravitated towards. The concept of sharing ideas early and often is important to the success of the research being conducted (MacDonald & Moss, 2014). One person may come up with the original idea, but by sharing the idea with others it can be adjusted so that the concept is clear and easy to convey to others (MacDonald & Moss, 2014). Think tanks are about people, and the people should be encouraged to collaborate.

Speaking about the people, another important point mentioned in the paper by MacDonald and Moss (2014) is to higher great people and give them the freedom they need. The CGD certainly has senior personal that are established and specialize in a field of study, but equally as important are the junior staff members that help bring fresh ideas to the process (MacDonald & Moss, 2014). It is important for the think tank to look for good people, senior and junior alike, to help generate new ideas for the organization.

In summary, this post has looked at what a think tank is and why they are important. We also examined a few of the methods used by think tanks to garner success. No matter what country you are looking at, think tanks can be associated with the government or industry, which could potentially skew their research. Even with that fact in mind, I personally think that the majority of think tanks do good research and add value to our society.

References

Hauck, J. C. R. (2017). What are ‘think tanks’? Revisiting the dilemma of the definition *. Brazilian Political Science Review, 11(2), 1-30. doi:10.1590/1981-3821201700020006

MacDonald, L., & Moss, T. (2014). Building a think-and-do tank: A dozen lessons from the first dozen years of the center for global development.  Retrieved from https://www.cgdev.org/publication/building-think-and-do-tank-dozen-lessons-first-dozen-years-center-global-development

  • Michael

Decision-Making Methods

In this post, we will be looking at two different decision-making methods.

Introduction
In this post, we will be looking at two different decision-making methods. Specifically, we will be comparing and contrasting the nominal group and Delphi techniques. We will look at what a nominal group technique is, along with examining what a Delphi technique consists of. We will then examine a few of the major similarities and differences between these two research techniques.

What are Decision-Making Methods?
Before we can examine the two different decision-making methods, we first need to understand what a decision-making method is. According to Fulop (2001), the decision-making process is one that is used to help identify and select alternatives based on input from leaders in the given field. The decision-making process consists of multiple steps that should be followed to achieve a useful outcome (Fulop, 2001).

Nominal Group Technique
In a nominal group technique, the individuals are seated around a table, and a standardized process is followed to solicit ideas (Van de Ven & Delbecq, 1974). First, Individuals quietly document their ideas on paper, followed by a verbal session for each individual to discuss their ideas (Van de Ven & Delbecq, 1974). After sharing their ideas, the group holds a discussion and asks clarifying questions about the various ideas presented, and at the end of the meeting, a silent vote is held to rank the ideas that were presented during the meeting (Van de Ven & Delbecq, 1974).

Delphi Technique
The Delphi technique is used to highlight the options and divergence of a panel of experts in a given field (Nworie, 2011). The fundamental principle of the Delphi technique is that the options of a panel of experts will be of a higher quality than those of a single individual (Nworie, 2011). Nworie (2011), has stated that the Delphi technique is used by leaders of organizations in forecasting decisions and to examine important and critical issues. The size of the panel selected to participate in a Delphi study can vary, but most researchers have agreed that the size should be between 10 and 50 participants (Nworie, 2011).

Compare and Contrast
One difference between the nominal group and Delphi techniques is that the nominal holds a face-to-face meeting, whereas the Delphi technique does not require an in-person meeting to make a decision (Van de Ven & Delbecq, 1974). Another important difference between these two decision-making techniques is that the Delphi technique encourages collaboration between panel members, whereas the nominal group method draws off of the individual’s ideas (Van de Ven & Delbecq, 1974). Both the nominal and Delphi techniques can be used by groups to effectively gather ideas to aid in the decision-making process.

Summary
In summary, the nominal and Delphi techniques take different approaches to gather information and making a decision based on that information (Van de Ven & Delbecq, 1974). Someone could argue that either of these techniques would be better to use than the other. I am of the belief that these different techniques exist because no one technique can be used to fit all situations. You will need to determine which technique best fits your needs.

References

Fulop, J. (2001). Introduction to decision making methods.  Retrieved from https://pdfs.semanticscholar.org/e0d8/d4fd210c4aeae40560c7332711c7cc8dc5df.pdf

Nworie, J. (2011). Using the delphi technique in educational technology research. TechTrends, 55(5), 24-30. doi:10.1007/s11528-011-0524-6

Van de Ven, A. H., & Delbecq, A. L. (1974). The Effectiveness of Nominal, Delphi, and Interacting Group Decision Making Processes. Academy of Management Journal, 17(4), 605-621. doi:10.2307/255641