Pharma forecasting in today's economy
At a recent eyeforpharma forecasting conference, Richard Murgatroyd, forecasting manager for Roche, mentioned that there are some who believe the global economic crisis was actually caused by a modeler.
By on Jun 22, 2009At a recent eyeforpharma forecasting conference, Richard Murgatroyd, forecasting manager for Roche, mentioned that there are some who believe the global economic crisis was actually caused by a modeler.
He says he read an article that claimed there was a math PhD who came up with the bright idea of compressing all possible interactions between borrowers into a single number. It was embraced whole heartedly by Wall Street, Murgatroyd said, and enabled them to turn very bad debts into AAA ratings.
Is it true? Hard to say, I suppose, but its certainly thought provoking.
Its a lesson in how everything we do and say particularly in a professional capacity has the potential to create a tsunami of implications. And nowhere is that more possible and frightening perhaps than in the field of forecasting.
Murgatroyd also relayed some thoughts about a book hed recently read called The future of everything: the science of prediction by David Orrell. In it, he says, Orrell explains that the word forecast was coined by Robert Digby, who was the head of the first meteorological office in the UK. He decided, Orrell writes, that prediction was too soft a word and we needed something with more weight, so he coined the term forecast to make it sound more serious.
Murgatroyd argues that maybe we should go back to prediction. Perhaps he has a point, especially when in these tough economic times people are looking more than ever for a crystal ball and an accurate one at that. Its tempting to think that at no time in modern history has it been more difficult to forecast what lies ahead. When all of the knowledge and assumptions on which the modern art of forecasting relies have been turned on their head, its natural to want to go back to that softer word of prediction.
But perhaps its not as dire as it may seem. In todays feature Forecasting to be proactive, rather than reactive (https://www.reutersevents.com/pharma/uncategorised/forecasting-be-proactive-rather-reactive) we see that Novartis has found a way to bridge the gap between divergent forecasts and improve accuracy, among other key benefits. And its reassurance that forecasting isnt too strong a word, even in todays economy.
As always, we'd love to hear your thoughts on forecasting in today's economy and whether you think Novartis is on to something.