The International Monetary Fund is one of those nebulous quangos that both exerts undue influence across our world whilst simultaneously being wealthily rewarded for abject failure.
Their latest debacle revolves around national economic output predictions. To co-opt the famous phrasing of the much missed, peerless Hans Rosling, a chimp picking bananas would outperform them.
Here's broadsheet economics commentator, Liam Halligan. Writing in London earlier this month;
Consider last week’s focus on new International Monetary Fund forecasts suggesting the UK would be the slowest growing G7 economy in 2023. There was much less emphasis on Britain’s growth performance in 2022, which was actually the fastest in the G7 – a fact, rather than a forecast. Or the reality that 25 of the IMF’s previous 28 predictions of UK growth have turned out to be too pessimistic.
There's quite a lot to unpick in that analysis.
If you subscribe to the tenet that the heaviest weighting for future performance is that which has gone before, then the IMF outlook for the UK seems odd.
As well as the fact that such league table comparisons in this context are I feel, deeply flawed. Often engineered to create the least lauding, longest lasting headline.
By way of context, here's a sentence from another of said broadsheet's columnists, Ambrose Evans-Pritchard;
"Some IMF staffer may think that Britain will be a particular sink of pauperisation in 2023 – worse even than Russia – but sophisticated global opinion has already moved on."
So let's examine the track record of said august crystal ball gazer.
Giving them some understandable slack for 2020 and 2021, isolating the 2010s decade saw forecasts so mixed as to overall be a fail grade. Of their nineteen World Economic Outlook predictions for Britain, ten were too pessimistic. You really ought expect better than flipping a coin from somebody with their clout.
As reported above, with 25 of the past 28 being too pessimistic in general, that's surely a Grade F fail.
I've blogged on the paucity of accuracy from this sector before. Like with the old jibe, 'two economists in a room will give you three opinions'.
And let it be said that up to September 2021, not a single institution foresaw Britain as the number one G7 growth economy for during 2022. [By way of example here's Chat GPT's listed eight leading forecasts for #1 G7 nation growth; USA (4) Goldman Sachs, Barclays, Credit Suisse, PwC; Canada (3) Morgan Stanley, UBS, ING; France (1) JP Morgan.]
The ramifications of this for our win likelihoods is fairly straightforward.
And a drum that I beat a great deal.
Identify what your most accurate predictors of future results are. Then relentlessly pursue, refine and celebrate them.
Unlike the IMF, can you spot the pattern of events that when coming into play, give you an overwhelming chance of success?
Beyond this fundamental, a number of associated factors need to be facing the right way.
The main dozen economic indicators the IMF use appear to be:
- Previous GDP
- Inflation rate
- Interest rates
- Unemployment rate
- Balance of payments
- Fiscal balance
- Exchange rate
- Trade balance
- Public debt
- Monetary policy decisions
- Government policies and regulations
- Demographic factors
With a slew of other measures contributing, including the non-economic.
Could we produce a similar list? Here's an initial stab.
How close have we an existing client that could be the prospect's twin?
How well do our two organisations gel and collaborate nicely?
To what extent are we strategically and tactically aligned?
How many levers have we pulled so far that previously led to a contract being signed elsewhere?
How close is the desired legacy stated to what we uniquely unleash?
What resource are they committing to the project?
How open is access to key personnel?
What's our track record in realising the competitive edge they seek?
How well have we established the (four) main buying area relationships?
Where are they on wishing everything was in place yesterday?
How close to the top of their to-do is this project?
If I were them, would I buy?
There's plenty of ways of calculating your win probability. You could even make your own closer mirror of the IMF inputs. Every now and then it pays to use a different one as an extra sanity check. Could you fashion such from this?