May 26, 2008

Looking for what we can't see.

Due to the completely underwhelming response to my last post, it's up to me to try and make sense of the quotes from Surowiecki and Taleb.

In thinking about it, these points struck me:

• that our complex social and financial systems are vunerable to "inevitable and random accidents"

• that the increasing interconnectedness of said systems spreads the impact of these accidents quickly and unexpectedly

• that the decreasing physical limitations in finance and information further inflate the likelihood of unforseeable events, aka Black Swans

• that humans are markedly incapable of forecasting the unknown

The more connected and digital things become, the more vulnerable the norms are to disruptive change. (This is painfully obvious in media and finance.) It plays into our herd instincts, which as we know, can result in suicidal stampedes and mass delusion.

As a company trying to develop relevant products and tell compelling stories, I think this extends beyond the basic "markets change quickly" bullet point. To me, it means that the illusion of control many of us still cling to has become even more false.

Events and opinions can cascade fiercely, no matter if they're based in fact or not. So, really, what you have to rely on is an honest viewpoint. Be true to yourself and give yourself a fighting chance. Falling back on spin and lies or hubris might save you in the short run, but long-term you'll find yourself without a market or a constituency.

I've got an OCDMBA friend who invariably describes how he's just waiting to wake up one day laid off and destitute. It's a joke, sort of. And although I don't want to live my life waiting for the other shoe to drop, it seems to me that today's world demands that companies actively try to forecast their demise.

If you're not figuring out how someone or something could disintermediate you or what parts of your business have value beyond a single market or audience or technology, then you're setting yourself up to fail. Look at the music industry. Failure to adapt to unforeseen, cataclysmic change. It's probably what we'll be saying about Ford in five years.

And I know that it's close to impossible to forecast the future with precision, but without doing that exercise we confine ourselves to being relevant yesterday, not today. Those unforeseen accidents or flukes are in fact a normal part of existence, so we better do our best to prepare ourselves for their arrival.


Richard Thompson said...

No one replied because your post is deep. But I'll throw in my two centimes.

It all boils down to how you deal with change. Some people try to plan for it or forecast it (companies), some try to avoid it (the French) and some just live it. Change isn't part of life, change is life, if you think about it. You take whatever steps you can to assuage or temper the effects of change, but at the end of the day change will sweep you along.

As for how it applies to marketing read this:

Tim Rickards said...

I don't know about "deep," but I'll take the compliment. At times, my intuitive sense far outstrips my analytical abilities. The similarity between these quotes, however, just jumped out at me.

You're right that change is the only true constant. I think that perhaps we've failed to adapt to the velocity and disruptive nature these new types of change, be they true black swans or simply a particularly vicious tipping of dominoes.

I encourage anyone reading this to check out Rich's link. Anecdote is a very innovative consulting firm, roughly based on the power of narrative in analyzing and fixing a broken or poorly performing system.

In their words:

"...a narrative approach to change and continuous improvement enables organizations to better prepare themselves for dealing with today's complex challenges and opportunities."