Exchanges: The Global Economy — Taleb

This is a dialog between the celebrated Nassim Nicholas Taleb and Justin Rowlatt about Exchanges: The Global Economy.

About:

“Do you underestimate the risk you are under? Nassim Nicholas Taleb’s ideas on probability and risk challenge assumptions made by markets and mathematicians all of over the world. His ideas on our blindness to the impact of improbable events have lead him to be described as a ‘super hero of the mind’ and ‘the hottest thinker in the world’. He is the author of the mega-selling books on randomness and the impact of the improbable on life and on economics – Black Swan and Anti-Fragile. His official title is Distinguished Professor of Risk Engineering at New York University and he continually ranks as one of the most influential people on the planet. He joins Justin Rowlatt and an audience at the Grand Amphitheatre of the Sorbonne in Paris for a special event, staged in partnership with Paris Dauphine University.”

http://www.bbc.co.uk/programmes/p01p174q

So what is prediction?

It is indeed unwise to predict the future. It just isn’t possible. Our traditional ideas of probabilities to ascertain risk is flawed. So the question ‘When something is going to happen?’ is pretty useless.

It does not serve any purpose predicting the past. It is only trying to answer the question ‘Why?’. When done, it is only a story with no certainty of being right.

Then is there any use of prediction?

Possibly yes, when we ask, ‘What is happening now?’ The future is unfolding now. The incipient seeds of the future have already taken roots in the now. Those give the clues. So it is useful to check what is happening right now.

But how do we look at it? Do we do it by thinking? There seems to be very little scope of doing so.

So do we frame a story? That could turn out to be a myth.

The only plausible way is to ‘observe’ or see or notice the present. Then only we have the chance to ‘see’ the future. In other words ‘predict’ it, even if it is a potential ‘black swan’.

Hence the most important question to predict anything is to ‘see’ what is happening now and not ask why something has happened or when something is going to happen.

That is the best way we can predict anything and remain useful.

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Daily Management

The idea of Daily Management runs deep in any organization.

Most top managers believe that some amount of routine work must be performed to keep the organization running. At times, the attitude is ‘more the better’. And everyone must be loaded with some routine jobs to be done on a daily basis.

The belief is so strong that ‘Daily Management’ is institutionalized in forms of check sheets, various forms, ledgers, routines, repeated tasks, regular audits, etc.

Most managers take this way of working as equivalent of implementing a desired ‘system’.

Over time, such routines become so fossilized that bringing in desired changes appropriate to changed circumstances becomes difficult.

What is missed out is the essence of ‘Daily Management’.

Daily Management is not only about doing some prescribed tasks on a regular basis but also improving upon those every day.

And Daily Management must only be focused on core activities that produced desired long-term results that help build sustainability and resilience in an organization.

In this way change management, which most argue is extremely difficult to start and carry out, is easily embedded in the organizational culture enabling an organization to be sustainable and resilient.

Sustainable Improvements in Resilient Manufacturing Systems

Few days back I was invited by an MNC to examine one of their manufacturing facilities.

The manager of the shop showed me around.

Seeing a wall-board full of photographs I asked, ‘What are these?’

‘These are some of the many improvements we have carried out in the facility’, he replied.

‘Can you show me some of these cases?’

‘No’, he replied. ‘These improvements don’t seem to stick. It is quite frustrating. Why do you think it happens like this?’  he queried.

‘It is simple’, I said. ‘Anything that changes with changing circumstances isn’t reality.’

‘What is to be done?’

Focus on things that don’t seem to change and focus on failures to permanently improve something that doesn’t change with changing circumstances. That is what sustainable improvement is all about, which in turn builds a resilient system’, I explained.

Resilience through self renewal!

India is a case study of resilience through motion and adhering to one’s calling in life. The idea of ‘motion’ or nomadic life runs deep in our Indian culture. Our rivers flowing endlessly across the vast landscape, giving life to the parched lands, are personified as metaphors of creativity and serve as timeless symbols of state transformations. The timeless whirl of bhikshus and monks wandering for alms in exchange of advice and wisdom for better living, jhum cultivation obeying the rhythms of nature, continuous growth of clusters and settlements in steady flux of self organizing movements, people in search of work, sadhus (seers) and pilgrims, mobile fairs and haat bazzars (markets), itinerant pilgrims, performers, pastoralists, bards and tellers of myths all embody the notion of ‘motion’; all performing simultaneously on the thin veneer of our ancient but extremely flexible and adaptable ‘culture’.

No wonder India is home to the world’s largest nomadic population always on ‘motion’. Nowhere else is there such a variety of people herded and ceaselessly moving in a self organizing way giving rise to complex patterns nor can the diversity of peripatetic professions be matched.

Yet in our post modern times the sedimentary have increasingly come to represent the ‘civilized’. The mainstream (the sedentary) stands oblivious to the pull of the wanderers and the scribes and the worlds of the nomads have been circumcised’ to the odd curious enthusiasts. Little wonder, nomads are considered ‘strangers’ where ‘strangers’ in principle are ‘undesirable’ people.

And how does this ‘undesirable’ attitude surface? ‘Indifference’ is the shield used by ‘foreigners’ (the non nomads) when they meet nomads. Insensitive and aloof the foreigner seems deep down beyond the reaches of attacks and rejection that he/she nevertheless experiences with the vulnerability of a living and tortuous ‘medusa’.

Such a ‘medusa’ painfully brings on an ‘identity’ of ‘being’ something distinct from others with a fixed character of its own. What it fails to realize or let go is that our identity is changed in a nomadic style by the journey we undertake in life where both our ‘subjectivity’ and ‘objectivity’ towards ‘reality’ is recomposed, rediscovered, redesigned and evolved. What we fail to realize or give up or let go is that in this transformation every step forward is a step backwards too. Without this necessary stepping back I can’t go forward. The migrant (nomad) is here and there too at the same time. The exile from the ‘nomad’ life can be deadening with the lack of ‘stretching’ and ‘folding’, which every movement entails. Such ‘stretching’ and ‘folding’ is nomadic symbolizing ‘movement’ that is potentially creative through unleashing ‘chaos’. It can also be an affliction but can also be a transfiguration. Whatever it might be it is a vital resource to create the necessary movement from ‘being’ to ‘becoming’.

If that is so what happens to my identity of ‘being’. My ‘being’ existence is actually non-existent. Is my identity not with ‘being’ but ‘becoming’? Do I live always on the edge of a frontier – a place for separation, transition and new articulation of a state that I haven’t seen or enjoyed before? In ‘becoming’ am I relieved of the odd task of constantly creating a boundary and jealously guarding it against attacks or rejection by constantly stepping back to cross or transgress it?

I realize that I am stranger to my ‘becoming’ state. What would happen is not known to me. What I would do as a response is also not known to me. In the state of becoming I change myself physically, mentally and spiritually and nothing is known to me in advance or ever would.

That to me is the cyclical principle of resilience gained through the constant act of self renewal through ‘becoming’ leading to self transformation.

What helps me do that? Obviously the mind which itself is ‘nomadic’. I can use it the way I would like to evolve, change, be creative and change the course of my destiny and self transform myself. I know the ‘why’ and ‘whom does it serve’ but I still remain a stranger to the ‘what’ and ‘how’ in any given moment in my movement.

That allows me to develop the ability to concentrate or be focused & also keep up a defused state of attentive awareness of the contextual surroundings at the same time (integration of the left & right brains). It is the fine art of being focused on the part and the whole at the same time enabling me to flow with the dance of Shiva. That truly makes my mind & spirit nomadic, enabling flashes of fresh and original insights to act upon.

This video link below shows how we integrate our right and left brains in real situations and how such integration leads to ‘becoming’ rather than ‘being’. Though I would always stay a stranger to that ‘becoming’ I refuse to remain a stranger to my present moment that informs my ‘becoming’.

http://www.ted.com/talks/iain_mcgilchrist_the_divided_brain.html

One thing I am sure of — Nomadic life – physically, mentally and spiritually – is usually the most gainful and risk free mode of resilient survival as it allows freedom from the limitations of confined space and time – the final form of slavery & exploitation, created by seemingly rational concepts, ideas and notions.

Living the life of a nomad is fun too since I would always stay a stranger to myself. It is a practice I love. Rightfully it is the only way one hugs resilience since it helps me to create what I want to. The practice is through travel to unfamiliar lands with new eyes and minds, engaging in spontaneous dialogs, self-study, storytelling, expressing differently through various forms of arts, interactions, improving interdependence and meditative reflection where both the right and the left brains are not only integrated but allowed to come into play simultaneously as a contextual response to real situations.

A few days from now, India celebrates Deepwali — the festival of ‘lights’. It reminds me of a celebration of a nomadic journey, thousands of years back, taken down the southern path of India (one of the two main trade routes) by Rama the hero of the epic story of Ramayana. It represents lighting the inner lamp to ‘becoming’ and to be a lamp onto others. It also reminds us to wish everyone Health, Happiness and Wealth so that the best things in life come back to us manifolds by creating sustainability and resilience at the same time.

On this auspicious occasion I dedicate this post to the Health, Happiness and Wealth of all who care to read this post or don’t care to glimpse through it.

But the question is “would you like to join me in the fun of moving and enjoying Shiva’s dance by being a stranger to yourself in the nomadic way?”

Would eagerly wait for you!

 

 

 

 

Perception, Sense-making, Enlightened Action

Right Perception and RIght Sense making are the fundamental outcomes of our cognitive ability that enable effective leaders take enlightened action. 

Possibly, most problems that we create through our actions are a result of wrong perception and wrong sense-making.

To me, Perceiving, Sense-making and Enlightened Action in life is something like this:

“Any real life System about which we care to perceive, make sense and take enlightened action, comprises of a meaningful set of ever changing and self transforming objects, diverse in form, complexity, state and function, interacting in periodic and aperiodic manner with each other and inter-related through multiple network of interdependencies through mutual feedbacks and signals thereby generating variable amplitudes of energy exchanged/transferred within variable/flexible space(s), mostly operating far from its equilibrium conditions; not only exchanging energy and matter with its environment but also generating internal entropy to undergo discrete transformation triggered by the Arrow of Time forcing it to behave in a dissipative but self organizing manner to either self destruct itself in a wide variety of ways moving towards void or create new possibilities in performance and/or behaviour from the void of creative potential owing to presence of ‘attractors’ and ‘appearance of bi-furcations’; thereby making it impossible to predict the future behavior of the system in the long term or trace the previous states of the system with any high degree of accuracy other than express it in terms of probabilities or possibilities since only the present state of the system might be observable to a certain extent and only a probabilistic understanding may be formulated as to how a system has arrived at its present state and what would keep it going, change or destroyed thus triggering creative human responses through right insights (not grossly based on emotions or thinking or memory) to manage, maintain and enhance system conditions, functions and purposes with minimal intervention to create superior systems of the future through enhancement of self organized interactions within and without the system interfaced with other connected, unconnected and overlapping systems operating within larger envelopes of human activity.”

Such a representation of an Perception, Sense-making and Enlightened Action looks quite involved.

Perhaps it might be stated in a much simpler ways but I would not attempt to do so since it would make it more complex that it should be.

Perhaps more can be said about resilience, agility, etc but I would not do so since those are really superfluous.

Perhaps more can be said about Black Swans and not so ‘black swans’ and predictions but I would care less to say so since saying more would be ‘redundant’.

The whole gamut of Perception, Sense-making and Enlightened Action takes place within five envelopes of human cognition, which are as follows:

1. Physical envelope

2. Energy envelope

3. Mental envelope

4. Wisdom envelope

5. Enlightened Action envelope

 

However, the crux of the matter is

1) how we ‘see’ reality (Darshan/Notice)?

2) how do we understand what the system is telling us (Sadhana/Engage)?

3) how do we create and choose our responses (Bhavana/Mull)?

4) how do we develop the necessary intention to implement our choices to life and living (Shankalpa/Exchange)?

 

notes:

1. Darshan, Sadhana, Bhavana and Shankalpa are Sanskrit words

2. The above post is an excerpt from or notes of a forth coming book “Leadership – The Nemetics Way!”

Listening and Innovation

When I was learning the tricks of my trade from my teacher, I used to listen.

Since I hardly ever questioned him or expressed any doubt about what he said he asked me one day, “Do you understand what I say?”

“Yes”, I said “since I intently listen to what you say.”

“And how is that?” he asked.

“When I am listening to you there are no longer two persons like you and I. There are no longer the speaker and the listener. I just become one with you. That is the only way I understand what you say. The whole responsibility is mine”

Even today, I remember not only what my teacher spoke but also remember the manner in which he spoke, wrote, explained, gestured — every small detail.

Soon some of my friends remarked that when I delivered a talk or a lecture or engaged in a conversation, I spoke and behaved exactly the way my teacher did.

Needless to say, that this skill of listening soon helped me surge ahead with rapid speed in what became my profession and my hobby.  Soon I innovated many special techniques and methods of innovation that can be easily applied to complex situations.

Listening is an indispensable skill in innovation.

It is so very important when innovation is a response to an existing complexity.

The goal of listening is to merge with what is being ‘listened’ to and be one with it.

Then only true understanding emerges.

All good innovations take birth from such true understanding.