Flawed Forecasts. BOOKS

MEGAMISTAKES: FORECASTING AND THE MYTH OF RAPID TECHNOLOGICAL CHANGE by Steven P. Schnaars, New York: The Free Press, 202 pp. $19.95

Americans, liking things big, love the prefix mega. In 1982, John Naisbitt wrote ``Megatrends,'' a buoyant look at future trends. In 1985, Gov. Richard D. Lamm of Colorado countered gloomily with ``Megatraumas,'' detailing America's imminent crises. Now comes ``Megamistakes,'' a breezy but well-researched reassessment of technological forecasts that promised bright futures and went nowhere.

Longer than it needs to be, but shorter than the world's list of notable failures, this book uses example after example to make its point: only about 20 percent of these forecasts prove accurate. ``Most technological forecasts fail not because of mistakes in fine tuning,'' writes Steven Schnaars, associate professor of marketing at Baruch College, City University of New York. ``They fail big.'' The very egregiousness of their failure, in fact, makes amusing reading.

Here are solemn pronouncements made in 1967 that, by the latter third of the 20th century, human hibernation for short periods would be possible (a discovery, I'm told, was long ago perfected by faceless bureaucrats).

Eating processed petroleum products or using chemical methods, citizens could change the sex of their unborn children, experience preprogrammed dreams, and overindulge in anything without fear of consequences.

Lit by artificial moons, their cities would be collections of ``smart houses'' with lasers to vaporize garbage, ultrasonics to vibrate the food off dirty dishes, and robots to mow lawns.

Fantasies of the ``Lost in Space'' crowd? Not at all. These are solid business forecasts, with dates and dollar figures attached. Now and then, of course, a forecast hits - VCRs, microwaves, express mail delivery.

But what happened to all those other things that were destined to sweep the land - quadraphonic stereo, picture telephones, interactive television, and the Edsel?

What, indeed, did happen? Schnaars, after surveying dozens of studies like TRW's ``Probe of the Future'' (1966), Herman Kahn's ``The Year 2000'' (1967), major offerings by Newsweek, the Wall Street Journal, and Business Week, and numerous corporate studies, offers three points to guide forecasters:

``[A]void falling in love with the underlying technology,'' he writes. The much-touted pace of change may not be as fast as people think. ``It is the applications of the technology that move markets,'' he warns, ``not the technical aspects of the product.''

Ask lots of basic questions - about the market. Who are the customers? How many are there? Does the new technology offer them any real benefits beyond the current technology? Will the innovation force them to change deep-rooted cultural customs or long-established business practices? These, he emphasizes, are not expert questions. They need only common sense - a commodity, it would seem, in short supply among forecasters.

Most important, perform the necessary cost-benefit analyses. How expensive is the product for the benefit it delivers? Great numbers of forecasts, Schnaars suggests, come to grief on these shoals - everything from Goodyear's moving sidewalk business (predicted in 1972 to be a $6 billion business in the 1980s) to DuPont's Corfam, the miracle substitute for leather that flopped when America's shoe-manufacturing business foundered in a storm of overseas competition.

Schnaars's book does not set out to be profoundly wise or scholarly. It simply provides a useful service, akin to that of a newspaper ombudsman or a media retraction: It holds forecasting to account. Too often we're fascinated by gee-whiz prophecies. Too rarely are we reminded, some years later, of how young and megafoolish we once were. Too often that very reminder is the beginning of wisdom.

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