book.chapter Predicting the future

The human brain is a marvel of predictive power, adept at processing current information to forecast future events. This innate capability is a cornerstone of success for many high achievers who use it to anticipate and strategically position themselves for what lies ahead. Today, there is a pressing need for businesses to emulate this ability by developing real-time predictive systems that can identify unfolding events, predict outcomes, and take decisive action. The aim is to embed the predictive prowess of legendary minds, such as hockey great Wayne Gretzky, into the fabric of business technology. Historically, companies have leveraged data analysis to gain predictive insights, achieving mixed results. Statistical models have been used to predict equipment failure, allowing for proactive maintenance. Marketers have analyzed zip codes to gauge the likelihood of consumer responses by location. Airlines have relied on historical data to forecast travel demand, optimizing plane occupancy. While these retrospective analytics are useful, they are limited to extrapolating from past data rather than forecasting the unknown. The next frontier in predictive technology involves delivering pertinent information to the right decision-makers at the optimal time, enabling them to seize emerging opportunities. For example, Southwest Airlines is piloting a real-time operations system that dynamically adjusts schedules and plane routing in response to disruptions such as inclement weather. By reacting swiftly to external events, Southwest aims to enhance efficiency and profitability. As Stephen Grossberg from Boston University puts it, we are in the midst of a significant revolution where the integration of brain-inspired models into technology is already underway, with the challenge being the creation of systems that can keep pace with our rapidly evolving world. Progressive companies are now focusing on developing systems that resemble the adaptable human mind rather than rigid organizational structures. The objective is to detect shifts in the external market as they happen and to make swift adjustments. In an unpredictable business climate, a single, well-interpreted piece of data can be more valuable than vast quantities of unprocessed information. Several technological and competitive trends are converging, making real-time predictive systems increasingly crucial: - Companies have amassed extensive experience in data collection and analysis using traditional databases over the past five decades. However, these legacy systems are at risk of being overwhelmed by the exponential growth of data from intelligent sensors and devices across various sectors. Moreover, databases are fundamentally retrospective. To manage the upcoming data deluge, the development of adaptive, neurobiological-inspired computing is essential. - The intensification of competitive pressures requires businesses to respond more rapidly than ever to market fluctuations. Firms are beginning to understand that real-time data is necessary for decision-making, rather than relying on outdated historical analytics. - CEOs and business leaders are now expected to make pivotal decisions about customers, competitors, and strategy with limited information and on a much more frequent basis. To be successful, they need accurate mental models that enable them to quickly predict potential outcomes, discern the essential from the non-essential, and connect disparate pieces of information. As Ben Horowitz, a former CEO, notes, decisions are often made with less than 10% of the information that will be available later. There is seldom enough time to gather all the necessary data before deciding on a course of action. Looking forward, the key to triumphing in a volatile business environment will be less about accumulating massive data stores and more about developing agile, predictive intelligence akin to the human mind. Innovations in software that incorporate neuroscience-based approaches—such as chunking information, constructing mental models, and discarding non-essential data—will offer the greatest competitive edge. Just as nearly anyone can become an expert in their field with 10,000 hours of deliberate practice, companies that invest in developing brain-inspired software stand to gain similar advantages. The human brain compiles details and experiences into retrievable chunks over time, creating complex mental models that facilitate quick, accurate intuitions about likely future events without conscious effort. In a similar vein, advanced predictive analytics software will empower businesses to swiftly analyze new situations and initiate the most probable actions for success. While replicating the sheer computational power of the brain is still a distant goal, neuroscience provides valuable insights for business technology software. Jeff Hawkins, an entrepreneur, emphasizes that prediction is not just a brain function but the primary function of intelligence. By understanding how the brain so effectively anticipates the future, computer scientists can now integrate similar predictive capabilities into software, rather than waiting for hardware advancements that may never materialize. In the coming years, we will witness the continued convergence of neuroscience and technology, with the cross-pollination of ideas leading to novel predictive applications. As competitive pressures escalate in a dynamic world, companies that adopt brain-like software for predictive analytics will consistently secure a first-mover advantage. Business strategists Vivek Ranadive and Kevin Maney assert that astute leaders will seize the two-second advantage, underscoring the importance of being ahead of the curve in decision-making.