Many large organizations use a stage-gate process to manage new product development projects. In a typical stage-gate process project managers learn about potential ideas from research and exert effort in development while senior executives make intervening go/no-go decisions. This decentralized...

We study the problem of forecasting a time series that evolves according to a dynamically changing, skewed life cycle. For instance, firms often need accurate distributional forecasts of product life cycles to make operational decisions about capacity and inventory management. These forecasts...

Firms today average forecasts collected from multiple experts and models. Because of cognitive biases, strategic incentives, or the structure of machine-learning algorithms, these forecasts are often overfit to sample data and are overconfident. Little is known about the challenges associated...

We consider two ways to aggregate expert opinions using simple averages: averaging probabilities and averaging quantiles. We examine analytical properties of these forecasts and compare their ability to harness the wisdom of the crowd. In terms of location, the two average forecasts have the...

Probability forecasters who are rewarded via a proper scoring rule may care not only about the score, but also about their performance relative to other forecasters. We model this type of preference and show that a competitive forecaster who wants to do better than another forecaster typically...

When several individuals are asked to forecast an uncertain quantity, they often face implicit or explicit incentives to be the most accurate. Despite the desire to elicit honest forecasts, such competition induces forecasters to report strategically and non-truthfully. The question we address...

Empirical evidence on the common ratio effect, a version of the Allais paradox, indicates that people are nonlinearly sensitive to probabilities. The leading explanation of this effect is prospect theory and its nonlinear weights applied to probabilities. We propose an alternative explanation:...

This paper examines the prediction contest as a vehicle for aggregating the opinions of a crowd of experts. After proposing a general definition distinguishing prediction contests from other mechanisms for harnessing the wisdom of crowds, we examine two common types of prediction contests. For...

Most organizations employ collaborative teams to manage innovation projects. While the use of collaborative innovation teams is a good starting point, an organization’s ability to innovate can be enhanced by managing risk-taking behavior through monetary incentive schemes and through an...