Thursday, November 2, 2017

Project history -- valuable?

Is keeping project history valuable? Doesn't every project office have at least cost history? Isn't all parametric pricing based on history?

Yes, to all of the above! Would there be statistics without history? No!

Ooops, perhaps everyone does not agree:
"History can not be explained deterministically and it can not be predicted because it is chaotic.

So many forces are at work and their interactions are so complex that extremely small variations in the strength of forces and the way they interact predict huge differences in outcomes....

Not only that, but history is what is called a level two chaotic system. ...  Level two chaos is chaos that reacts to predictions about it, and therefore can never be predicted accurately"
Yuval Harari

And, so the take away on this is what? That history is useless for predicting an outcome based on that history? Or, that one historical outcome could easily have been another, quite different, except for some favorable interactions -- thus, who knows what might happen the next time around?

Or, even more intriguing is the last point: a prediction actually changes the predicted outcome. Somewhat like the oft encountered conundrum that a measurement or observation changes that which is measured or observed.

And, of course, there is the timeless nemesis: causation vs correlation vs coincidence.
  • Causation: A causes C
  • Correlation: A causes some reaction in B which causes some reaction in C (correlation has a third party in most cases, though B may be hidden and hard to discern)
  • Coincidence: Stuff happens
Ultimate take away: history is problematic, even if it is very instructive. Predictor be aware!

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