Humans are prediction machines!

self taught robots

Browsing at my local library the March issue of Scientific American caught my eye. I’ve had an interest in robots since I was a kid and read about about them in Isaac Asimov’s science fiction books.

Watching today’s robots from Boston Dynamics  on YouTube is truly amazing – science fiction come to life. But reading the article Soft-Taught Robots by Diana Kwon what really intrigued me was the section Prediction Machine. I’ve long thought that the major difference between the two ways to understand the world — science and religion – was that  science could actually predict the future, religion can not. And the essence of science is its reliability – predicted results could be replicated by other scientists. a process known as peer review.

The article’s elucidation of humans as prediction machines was what really illuminating for me: OUR BRAINS are constantly trying to predict the future—and updating their expectations to match reality. And the concept that the brain and nervous system are bilateral.

Our minds are prediction machines, using prior experience and knowledge to make sense of the deluge of information coming from our surroundings. Many neuroscientists and psychologists believe that nearly everything we do—perception, action and learning—relies on making and updating expectations.

Crucially, the downward signals from the higher levels of the brain continually interact with the “upward” signals from the senses, generating a prediction error: the difference between what we expect and what we experience.

A signal conveying this discrepancy returns to the higher levels, helping to refine internal models and generating fresh guesses, in an unending loop. “The prediction error signal drives the system toward estimates of what’s really out there,” says Rajesh P. N. Rao, a computational neuroscientist at the University of Washington.

This concept that nearly everything we do is governed by our extremely powerful drive to reduce or correct prediction error: the difference between our expectation – our internal mental model, and reality – what’s outside our mind and perceived by our senses.  This prediction signal loop is the also the core of  Norbert Weiner‘s cybernetics: the scientific study of control and communication in the animal and the machine. Surprisingly Weiner and cybernetics don’t merit a mention in the article.

But cyberneticity of the human nervous system is well illustrated in the Scientific American article:

brain image

So what does the concept of humans as prediction machines fighting information overload have to do with entrepreneurs? As I’ve written in the post The Attention Economy When it comes to pitching investors, customers, job candidates, advisors, job candidates or communicating with other stakeholders and influencers entrepreneurs need to keep in mind that attention has become one of the most limited, and therefore most valuable, commodities there is.

A deeper understanding of attention, that it is a consequence of humans as prediction machines leads to a realization that many problems come from the failure of consumers to close the gap between their expectation and reality, creating either pain or a   mental equivalent of the itch that must be scratched. Thus entrepreneurs must view their products not as simply pain pills or vitamins, but helping consumers close or eliminate the prediction gap. Perhaps the best example I know of the is invention of the electronic spreadsheet, which enables users to create and easily modify models that are predictive. If  my raw materials cost goes up by 7% how much do I need to increase my product’s price to maintain my profit of 15% and how will my market share, the percentage of the market I control, be effected? All businesses run on keeping track of projected versus actual, on the operating side that includes cost of raw materials and on the revenue side that includes total unit sales, returns, and pricing.

Once you have a product that either relieves pain or creates a habit, your job is only half done, you need to influence consumers to buy and use your product. By understanding consumers as prediction machines with fixed amount of attention you can you craft a marketing message that gets through the incessant blizzard of stimuli bombarding your prospects.  Otherwise known as cutting through the noise – where noise is defined as signals that do not help close the gap between expectation and reality and may actually interfere with it, like the sound of a jackhammer while you are trying to write a blog post. At its basest level virtually all advertising and marketing communications is saying, Hey, you have this problem – whether you realize it not – and by using our product you can eliminate it! Aspirational marketing actually creates the expectation – that just like the smiling, happy people in all of Apple’s ads – you too can attain that state of bliss, where that painful gap between expectation and reality is closed. Of course, you must continue to use the product or service to keep it closed!

Author: Mentorphile

Mentor, coach, and advisor to entrepreneurs, small businesses, and non-profit organizations. General manager with significant experience in both for-profit and non-profit organizations. Focus on media and information. On founding team of four venture-backed companies. Currently Chairman of Popsleuth, Inc., maker of the Endorfyn app for keeping fans updated on new stuff from their favorite artists.

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