On Bankability
Since I’m interested in probabilities and predictions, one of my favorite online feuds is that between Superforecasting author Philip Tetlock and Black Swan author Nassim Nicholas Taleb. So I was intrigued the other day when Taleb tweeted that his reply to Superforecasting is forthcoming. In it he asks the very fair question “If they claim to be so good at forecasting, and their forecasts are actionable and related to reality, why aren’t they so rich?”
Look, everything isn’t about money, but money is a very interesting way of keeping score. This is why Taleb, in the conclusion, recommends that superforecasting be applied to “bankable” events. That means those where knowing the future can be translated into “dollars and cents.”
This got me thinking about bankability and how it applies to everyday life. If I spend time going for a run, is that bankable? Is doing a crossword puzzle bankable? Should everything be bankable or is it okay for some things not to be? Is there such a thing as non-cash bankability?
Mark (our COO) has a paradigm (that follows) for when it comes to helping our operating companies create new capabilities inside of their businesses. He asks, “Do we need to know how to build the capability or do we just need the benefit of the capability?” If the former, we should probably hire for it, develop it, and sustain it. If the latter, we should probably buy it or outsource it.
In other words, which part of what needs to happen for us to move forward is most bankable? Because that’s where we should put our chips.
I don’t think everything is about money, but I do think actions should have expected, measurable, and concrete outcomes in order to be worthwhile. Maybe that’s crass, or transactional, but before I do anything now I do find myself asking “Is it bankable? How? If not, why?”
– By Tim Hanson
