“O that a man might know
The end of this day's business ere it come!”
So said Brutus towards the end of Shakespeare’s Julius Caesar and, if you know your Shakespeare or your classics, then you’ll know that things didn’t turn out very well for history’s most famous backstabber. Nonetheless, the quote illustrates one of life’s key dilemmas: how can we know for sure how things will turn out? Our September’s Showcase Deconstructing Uncertainty: "We Should Have Seen It Coming!" provided an insightful overview of tools and techniques to help address this fundamental issue.
Speaker Bruce Garvey, a specialist in advising organisations faced with high levels of uncertainty, thinks that we need to put more effort into dealing with uncertainty so that we minimise the chances of saying “if only we’d known…” at the end of a botched project or plan. He started by clarifying the distinction between risk and uncertainty. Simply stated, the main difference between uncertainty and risk is that risk can be quantified and uncertainty cannot. However, uncertainty can be modelled and organisations need to get a lot better at how they approach to modelling and the conversations around such models.
As someone who has based his consulting career on the ability to make complex things simpler for my clients – something that most consultants pride themselves on – I was a bit taken aback by Bruce’s statement that simplification can obscure unanticipated or unexplainable details and in doing so, increases the likelihood of unreliable performance. Highly resilient organisations, he observed, manage the unexpected by being reluctant to accept simplifications. He’s right – and if I’d had Bruce’s book (Uncertainty Deconstructed written with Dowshan Humzah and Storm Le Roux) a couple of decades ago, I might have invested more time in equipping my clients with some of the tools and techniques introduced in it.
The book and Bruce’s talk introduce three broad categories within which uncertainty can be better understood: 1. the structural components such as how to locate uncertainty on the risk spectrum, 2. the ways in which scenarios can be developed, and 3. the ways to understand the behavioural or cognitive biases that get in the way or influence our understanding of it.
Within this framework, several methods, tools and techniques exist. Time didn’t allow for an examination of most of these (they’re described in the book) but the concept of “unknown knowns” was introduced. Most people are familiar with Donald Rumsfeld’s identification of “known-unknowns” where we have an idea of what might happen but not when it might occur, and “unknown-unknowns”, truly unknowable events (or black swans). According to Bruce, we don’t need to worry about these if they are genuinely unknowable but instead should concentrate on those areas where we don’t know what we know or we think we know but it then turns out we don’t. These grey areas are where weak signals are missed by analysts or decisions are made on the basis of hubris – in other words, the tricky world of unconscious bias and assumptions.
Bruce completed his talk with a set of challenges for consultants, including the trap of oversimplification and, critically, to make planners aware of the fact that the future is dynamic and there is a need to move away from fixed planning cycles. This was perhaps best summarised by boxer Mike Tyson’s observation that “everyone has a plan until they get punched in the mouth”.
It was another rich Showcase that provided much food for thought and plenty of challenging questions along the way.
You can find a recording of the session here.
Nick Bush is Director of CMCE.