Millennium Project SOFI Tool

In the past two years, the Millennium Project has produced an experimental State of the Future Index using several Lotus spreadsheet macros. There seems to be some interest in the Index so the Millennium Project wants to improve the software. The improvements should make all of the software bits and pieces previously used to build the SOFI into one neat program, allowing people unfamiliar with the arithmetic to use it and build SOFIs of their own, and to simplify the task of updating the SOFI every year.    (02)

Two types of Lotus spreadsheets are used to calculate SOFI: One to forecast the variables using Trend Impact Analysis (TIA), and the other to calculate SOFI itself, based on the forecasts of the variables. A standard statistical program is used to produce the extrapolative "baseline" for the Trend Impact Analyses.    (04)

The spreadsheet for a single TIA produces a forecast for a single variable (so there are a total of 19 of these sheets). The inputs are:    (05)

• The historical data for the variable.    (06)
• A momentum (extrapolative) forecast (done with statistical software that gives a best fit time series).    (07)
• A set of future events that can perturb the momentum forecast.    (08)
• A probability time history for each of these events.    (09)
• The impact of each event -- should it occur -- on the variable.    (010)

At some small increment of time from the present, each event is decided on the basis of its probability at that time through comparison with a random number. If it "happens" the future course of the variable is adjusted according to the given impacts. If it does not, the event is retained to be decided later. Then the time moves forward another increment and the remaining events are decided. This constitutes a single run and in the TIA macro, this process is repeated 50 times. So a "fan" of outcomes is produced from which the upper quartile, median, and lower quartiles forecasts for the variable are identified.    (011)

The second type of spreadsheet computes the SOFI from the history and forecasts of the variables. The inputs are:    (012)

• The time histories of the variables.    (013)
• The best and worst values anticipated for the variables.    (014)
• The assigned weights for best and worst.    (015)

The spreadsheet normalizes the value of each variable at each time, calling the worst value zero, and the best, 100. In other words each variable is restated in terms of the percentage of its position in the worst to best range. An S-shaped function is introduced into the weighting so that close to the worst is more important than close to the best, and a value for each variable at each time is computed (weight times normalized value). Finally an index is formed by adding the values for all of the variables at each time and then dividing by the sum for the current year.    (016)

Special attention must be paid to the computation of the quartiles of the SOFI. One cannot use the upper quartiles for all of the variables to compute the upper quartile of the SOFI, because in the real world, some variables will be high while others are low. A Monte Carlo approach was used in this instance.    (017)

The target audience for this tool are those people interested in computing their own SOFIs. This includes:    (019)

• The Millennium Project and its Nodes' members    (020)
• Regional and global policymakers    (021)
• Professionals, scholars, and academics: Economists, political scientists, social scientists, etc.    (045)

The policymakers will come from both developed and underdeveloped countries. Some of the representatives of underdeveloped countries may have limited experience with computers, but everyone will have computer-literate staff members.    (046)

Approximately 95 percent of the prospective users are running the Windows operating system. Most of the prospective users are proficient with spreadsheets.    (023)

The market for the initial release of the SOFI tool will range between three and 100 users.    (024)

The Millennium Project would like to have a simple-to-run, integrated, program with a well-designed graphical user interface for calculating SOFI. The value proposition for such a tool is best expressed in Chapter 2 of the 2001 State of the Future:    (026)

The Millennium Project would like to have the tool ready for distribution with the 2003 release of State of the Future and Futures Methodology 2.0. It would like the tool to be freely available and open source, so that the tool may be collaboratively developed based on the evolving needs of its users. It envisions a new release of the tool every year.    (028)

The highest priority for this tool is ease-of-use. The first release of the SOFI tool should essentially consist of the functionality of the current spreadsheets, converted into a coherent, user-friendly program. The tool should not require training; a simple manual, integrated into the tool itself, should be enough for the user to start using the tool.    (042)

Initially, professionals, scholars, and academics from the more developed countries (e.g. U.S., EU, China, Australia, etc.) will use the tool.    (047)

As SOFI becomes mainstream, the Millennium Project would like to see many countries and regions to be tracking their own SOFI. Newspapers and other publications could cite, or even syndicate, SOFI as they would today with some of the economic indices (like DOW, NASDAQ, S&P500, FTSE-100 or NIKKEI-225.) Future phases of the software could associate SOFI with scenario building and validation, as well as with front-ends that facilitate the capture of judgmental or other research inputs. Eventually, SOFI could become the basis for its own publication with a broader audience (a circulation of over one million; say) than the current State of the Future report. By architecting it as an open knowledge system, and developing this software in an "open source" mode, it is envisioned that it will become a collaboratively developed and continuously improving system. Among others, is the normative desire to maintain an authoritative, accurate, and up-to-date database of data relevant for computing SOFIs, and to make such database available in a consistent, standard format. Coupling that with the research content and scenarios, the SOFI software tools and system shall, hopefully, become an useful and compelling tool/platform/knowledgebase for the futures research community, policy makers, strategists, scholars and other SOFI users.     (044)