The recent wildfires in wine country remind me of a book by author Nassim Taleb. The book’s title, The Black Swan, comes from a period in history when it was only thought that there were white swans. That was until early travelers discovered black swans on another continent, something they never thought possible. The book’s subtitle, The Impact of the Highly Improbable, foretells its underlying theme, which is how we can be fooled by randomness.
Taleb describes a black swan as a highly improbable event with three principal characteristics: it is unpredictable; it carries a massive impact; and after the fact, we concoct an explanation that makes it appear less random, and more predictable, than it was. He cites the success of Google as a black swan, as well as 9/11. The wildfires were not predicted, they had a massive impact, and now lawyers are pointing fingers and politicians are creating new legislation. After the fact, everyone has an explanation, making this yet another example of a black swan.
The problem, as Taleb points out, is that humans are hardwired to learn specifics when they should be focused on generalities. We concentrate on things we already know and time and time again fail to take into consideration what we don’t know. We are, therefore, unable to truly estimate opportunities, too vulnerable to the impulse to simplify, narrate, and categorize, and not open enough to reward those who can imagine the “impossible”.
Next time you are in a meeting and someone brings up an event that could help or hinder the achievement of your organizations objectives, consider the possibilities rather than the probabilities. We live in a world of uncertainty where odds and statistics don’t apply unless you own a casino or an insurance company. For the rest of us, we must think differently and remember to make judgements under uncertainty.
Don’t wait for opportunity – create it!