History is littered with the failed predictions of experts. Yet governments hire high-paid consultants to advise on policy; businesses use them to vet research and development projects; and venture capitalists have them make investment decisions. Experts excel in looking backwards, protecting their turf, and saying what their clients want to hear. Their short-term predictions are sometimes right, but they are almost always wrong in forecasting any more-distant future.
Experts are the greatest inhibitors of innovation—the ones who shouldn’t be listened to. Peter Diamandis says it best: “an expert is someone who can tell you exactly how it can’t be done”.
Look at some of the most famous historical examples:
“The telephone has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us” said a Western Union internal memo in 1876.
“Heavier than air ﬂying machines are impossible” said Lord Kelvin (William Thomson), President of Royal Society of London in 1895.
“There is no reason for any individuals to have a computer in their home” said Ken Olsen, President, Chairman and Founder of DEC in 1977.
The problem with experts is that they think they know it all; ignore data that don’t fit their points of view; and extrapolate from the past on a linear basis. If some disruptive technology hasn’t come along in the past, the assumption is that it won’t happen in the future. What’s worse is that experts often try to block technologies that might up-end their roles. After all, if things change too fast, they will no longer be experts.
You see these specialists in governments, businesses, and academia. Government experts usually have an agenda. Business experts are typically old-timers trying to protect their jobs. Academics specialize in digging deep into fields that most people would consider arcane or obscure. They gain tenure by writing academic papers and being extremely knowledgeable in a narrow area. They often remain in the same field for decades and can’t see the forest for the trees.
Technology is, today, moving faster than ever. Advances that took decades, sometime centuries, such as the development of telephones, airplanes, and the first computers, now happen in years. Witness how smartphones and social media have come out of nowhere in the past seven years and changed the way we interact and communicate. We are always connected to each other and to our employers. Computing power is advancing at exponential rates and causing acceleration in fields such as artificial intelligence, robotics, 3D printing, sensors, and medicine.
When advancing technologies converge, they lead to artificial intelligence–based apps that analyze data from medical sensors, with the potential to disrupt the medical industry. Smartphones apps such as Uber and AirBnb are already threatening transportation and lodging. Amazon.com has made bookstores disappear and Apple has changed the music industry. Which experts ever predicted these disruptions?
The experts are becoming more wrong—and irrelevant—than ever.
In the early 1980s, for example, McKinsey & Company created a forecast for AT&T of how many cellular phones would be in use in the world in 2000. It estimated this number to be 900,000. The actual number was greater than 100 million.
In June 2007, then Microsoft CEO Steve Ballmer said in an interview with USA Today that there is “no chance that the iPhone is going to get any significant market share. No chance. It’s a $500 subsidized item”. The iPhone currently has 42% market share in the U.S.
Silicon Valley’s most respected venture capitalists can’t see even the near future. Mary Meeker of Kleiner Perkins Caufield & Byers produces a yearly report, Internet Trends, which is the tech industry’s bible. Its May 2013 report analyzed the leading players in social media and made predictions on the future of mobile technologies. It did not even mention WhatsApp—which Facebook acquired for $19 billion in February 2014. This was the largest acquisition in history of a venture-backed company and was not even on Meeker’s radar.
As an academic expert in advancing technologies, I may lack the credibility to write this article. When entrepreneurs come to me for advice, I tell them, as I am telling you, to take it for what it’s worth. No one can accurately predict the future of business any more, because too much is happening too fast. At best, you can gain an understanding of the overall trends and the types of opportunities and obstacles that lie ahead. You can look backwards to understand what problems have already been solved, how others overcame hurdles, and what types of business strategies worked best. You can learn what questions to ask. You can realize yourself when your idea is either just plain silly or impractical.
I tell entrepreneurs that if they really believe in their gut that they have a world-changing idea, then they should pursue it. They shouldn’t let anyone stop them—no one really knows more than they do. As Peter Diamandis also says, “The day before something is a breakthrough, it’s a crazy idea”.