Navigating Uncertainty Needs Prediction Skills
I feel inspired as we enter 2025. The goals and plans ahead fill me with a renewed sense of energy and potential. If you’re anything like me, you’re excited about what’s to come.
Given how quickly things change, let’s explore how we can turn unpredictability into opportunity.
Think Fast and Slow About Uncertainty
Uncertainty is all about recognizing the things we don’t know.
The Psychologist Daniel Kahneman identified two ways of thinking: the fast, unconscious gut reactions and the slower, more deliberate approach to problem-solving.
The fast can be seen such as in everyday situations. Yet, the slower isused for significant decisions, where we give ourselves time to think.
Fast thinking helps us react quickly to immediate surprises, like taking a detour when a road is closed. Slow thinking is for more significant uncertainties, like carefully evaluating whether to expand a business into a new market.
Conjuring Possible Futures
The first step in taking a slow approach to future thinking is to visualize how different scenarios might unfold. We can consciously evaluate our usual perspectives and create scenarios reflecting both positive and less favourable possible outcomes. This involves thinking about current variables that can influence what might happen.
What Makes an effective Forecaster
Forecasters tend to have openness to new knowledge and are happy to work with people from diverse fields. They have an insight into their thinking and all their biases, and simultaneously have the humility to acknowledge uncertainty, admit errors, and change their minds. They are willing to adapt to new evidence rather than stuck in a single way of thinking.
We can explore their steps by taking the STEEP analysis into our life. Here are the 5 factors:
- Social: sensing societal values, and behaviors to understand and adapt to shifts impacting us.
- Technological: innovations and factors like communication, automation, and regulations that transform operations, costs, and profitability to our lives.
- Economic: being aware of factors such as inflation and trade influencing us when purchasing power and operating in business.
- Environmental: exploring the relationship between climate change, natural resources, and our lifestyle.
- Political: how laws, policies, and stability impact taxes, trade, labor, and regulations.
By understanding these influences and being open to adapt to new information, we can explore smarter choices and navigate the changes ahead.
Acknowledging the Unknown
None of us can predict what will happen next. Donald Rumsfeld described the “known unknown and the unknown unknowns”. Those things were beyond our imagination and had not even been thought of.
When we acknowledge this possibility, this is known as “deep uncertainty”, when we can even list the possible futures, even with a red-team mindset.
Being Prepared to Be Surprised
By embracing the possibility of being wrong, we position ourselves to adjust to unforeseen information.
The Role of Luck
Things may turn out well for us or the other way around, due to factors beyond our control.
Philosophers and researchers have long explored the concept of luck, categorizing it into three main types: constitutive luck, circumstantial luck, and resultant luck (Nagel, 1979; Rescher, 1995).
Constitutive luck refers to the traits we are born with or the circumstances we are born into that shape our opportunities in life. Circumstantial luck involves being in the right place at the right time or encountering situations that significantly affect our lives. Resultant luck describes how outcomes unfold based on our choices and chance, regardless of how well we plan.
Understanding these types of luck helps us recognize how external factors influence our lives and decisions, even when we have carefully planned and prepared.
These aspects of luck remind us to stay humble and adaptable, as they highlight the influence of what we are born with, the situations we experience, and the role chance plays in our lives.
We can’t control external factors, but we can control your response to it. Focus on what is within our power: build skills, stay prepared, and remain open to opportunities. Meet new people, explore an innovative mindset, and put ourselves in situations where good things are more likely to happen. Additionally, plan for risks and have backup strategies. By being adaptable and resilient, we’ll be better equipped to seize positive outcomes and handle challenges as they arise.
Recognizing luck doesn’t diminish preparation; it emphasizes the need for continuous learning and strategic networking to be ready for uncertainty.
Living with Uncertainty
Being uncertain is part of being human. Uncertainty is unavoidable, and we may react to that awareness of ignorance in a variety of ways. We may feel anxious or excited, hopeful or fearful, depending on the circumstances and our personal tolerance of not knowing.
We cannot avoid uncertainty. But with slow thinking we may be able to embrace it, and enjoy it.
A message for 2025
Uncertainty is not a threat; it is an invitation. We can see 2025 as a year of opportunities.
We set our goals. We plan it thoughtfully, and trust our instincts. We act when the time feels right. Plus, let’s surround ourselves with a network of inspiring learners and doers who encourage our growth.
Here’s to turning 2025 into an outstanding, thoughtful adventure!
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