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New economy belongs to the ‘creator’

In forecasting, look for what is out of place

Creating manmade islands for foreigners in the deserts of Dubai. Building burgeoning housing developments in exurban Tracy, Calif. These were just a couple of trends that stood out as odd to forecaster and Stanford University teacher Paul Saffo in the years leading up to the housing downturn. "Forecasting looks at how hidden currents in the present signal possible changes in direction for companies, societies or the world at large," Saffo wrote in an article for the Harvard Business Review. To Saffo, who spoke at the Pacific Coast Builders Conference (PCBC) in San Francisco last week, the forecaster's job is to apply common sense to spy those indicators of change. "When you see something strange, write it down. Keep a notebook. Put it down in a computer," Saffo advised conference attendees. "The difference between reality and a forecast is that a forecast has to be believable, conceivable, reliable. Reality is under no such constraints." In December 2...