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{{a| | {{a|systems|{{image|Pripyat|jpg|}}}}{{quote| | ||
''Everybody has a plan until they get punched in the mouth.'' | |||
:—Mike Tyson}} | |||
===You can’t ''eliminate'' the risk, so focus on ''managing'' it=== | ===You can’t ''eliminate'' the risk, so focus on ''managing'' it=== | ||
A traditional risk manager — that is, one managing [[complicated system]]s and not [[complex system|complex]] ones<ref>Open question — a ''gaping'' open question, like when your goalie has come up for a corner — is ''why'' a traditional risk manager is managing what is undoubtedly a [[wicked environment]] using tools suitable for a [[tame environment|tame]] one. But it was ever thus: [[Black-Scholes option pricing model]], which is predicated on a normal distribution, can’t work with The [[Black swan|tail events]] and whose failure in those circumstances led directly to both the [[LTCM]] collapse and the [[Great Financial Crisis]], is still widely used today, after all.</ref> — will be conditioned to using control techniques to anticipate and eliminate all risk. | A traditional risk manager — that is, one managing [[complicated system]]s and not [[complex system|complex]] ones<ref>Open question — a ''gaping'' open question, like when your goalie has come up for a corner — is ''why'' a traditional risk manager is managing what is undoubtedly a [[wicked environment]] using tools suitable for a [[tame environment|tame]] one. But it was ever thus: [[Black-Scholes option pricing model]], which is predicated on a normal distribution, can’t work with The [[Black swan|tail events]] and whose failure in those circumstances led directly to both the [[LTCM]] collapse and the [[Great Financial Crisis]], is still widely used today, after all.</ref> — will be conditioned to using control techniques to anticipate and eliminate all risk. | ||
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You ''cannot'' brute-force compute a [[wicked problem]], like catching a ball,<ref>Ohh, but catching a ball isn’t a wicked problem! I hear you cry. For hard-determinist, reductionist types maybe, but if you have ever pondered the odd lack of tenured physics professors in the national cricket team you may, like the [[JC]] beg to differ. The [[JC]]’s celebrated experiments with [[the proverbial crisp packet in St Mark’s Square]] may help explain.</ref> ''but you can still catch a ball''. Don’t think, “punch all the variables into a machine and run round to the resulting co-ordinate and stick your hand out.” You don’t have nearly enough information to even make the calculation. Instead, just run towards the damn thing, watching it, adjusting as you go.<ref>A study a while back found professional baseball players, while ''excellent'' at catching moving balls they were allowed to run towards, had a lot more trouble predicting where those balls would land when made to stand still.</ref> | You ''cannot'' brute-force compute a [[wicked problem]], like catching a ball,<ref>Ohh, but catching a ball isn’t a wicked problem! I hear you cry. For hard-determinist, reductionist types maybe, but if you have ever pondered the odd lack of tenured physics professors in the national cricket team you may, like the [[JC]] beg to differ. The [[JC]]’s celebrated experiments with [[the proverbial crisp packet in St Mark’s Square]] may help explain.</ref> ''but you can still catch a ball''. Don’t think, “punch all the variables into a machine and run round to the resulting co-ordinate and stick your hand out.” You don’t have nearly enough information to even make the calculation. Instead, just run towards the damn thing, watching it, adjusting as you go.<ref>A study a while back found professional baseball players, while ''excellent'' at catching moving balls they were allowed to run towards, had a lot more trouble predicting where those balls would land when made to stand still.</ref> | ||
Now, compare catching a ball with predicting any future event — be it the expected local weather in [[Lissingdown]],<ref>May the lord bless and watch over Ronnie Barker.</ref> or the level of the Eurostoxx, six months from now. The further in the future the event, the poorer your ''snapshot'' prediction will be, however sophisticated your apparatus. Now, ball-catching isn’t ''that'' wicked: | Now, compare catching a ball with predicting any future event — be it the expected local weather in [[Lissingdown]],<ref>May the lord bless and watch over Ronnie Barker.</ref> or the level of the Eurostoxx, six months from now. The further in the future the event, the poorer your ''snapshot'' prediction will be, however sophisticated your apparatus. Now, ball-catching isn’t ''that'' wicked: none of the factors at play in the fight of a cricket ball are especially suggestible, or possessed of independent moral agency, after all. Weather predicting is more wicked, and stock markets are properly, fire-in-a-crowded-theatre wicked, but the principle remains the same. ''The nearer you are to the event, the better your guess will be''. | ||
Calculating an exact parabola from initial conditions — even if you have good approximations of the necessary data inputs to hand, which you won’t — will give you a rough vector and distance, but the range of potential trajectories will be far too great to to ever actually catch the ball. Likewise, the prediction of rain in [[Lissingdown]] a month in advance is is highly speculative: we may have average rainfall data, but as to whether it will rain or not at a given moment, who can say? | Calculating an exact parabola from initial conditions — even if you have good approximations of the necessary data inputs to hand, which you won’t — will give you a rough vector and distance, but the range of potential trajectories will be far too great to to ever actually catch the ball. Likewise, the prediction of rain in [[Lissingdown]] a month in advance is is highly speculative: we may have average rainfall data, but as to whether it will rain or not at a given moment, who can say? | ||
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This is hard for a [[complicated system]]s guy. [[Complicated system]]s you can brute force, and you can predict how they will behave. You can pre-bake solutions, making them more simple. In [[complex system]]s you can’t: need to keep your options open and be prepared to shift, adapt, re-evaluate, and toss out whatever you might have concluded before now. {{author|Philip Tetlock}}’s “{{br|Superforecasters}}” are complex systems thinkers. Baseball players are complex systems thinkers. Richard Dawkins, whom I like to imagine was dyspraxic,<ref>largely because he was trying to solve differential equations instead of running after the ball, of course.</ref> is a [[complicated system]]s thinker. | This is hard for a [[complicated system]]s guy. [[Complicated system]]s you can brute force, and you can predict how they will behave. You can pre-bake solutions, making them more simple. In [[complex system]]s you can’t: need to keep your options open and be prepared to shift, adapt, re-evaluate, and toss out whatever you might have concluded before now. {{author|Philip Tetlock}}’s “{{br|Superforecasters}}” are complex systems thinkers. Baseball players are complex systems thinkers. Richard Dawkins, whom I like to imagine was dyspraxic,<ref>largely because he was trying to solve differential equations instead of running after the ball, of course.</ref> is a [[complicated system]]s thinker. | ||
===If a | ===If a complex system blows up, “[[complicated]]” risk management systems can get in the way=== | ||
Frequently complicated system risk attenuators can, in fact, aggravate risk situations in complex systems. Alarms going off make it harder to hear; multiple alarms increase panic and obscure each other; an obligation to follow prescribed safety routines can impede quick and surgical response to traumatic situations. There are times, therefore, where you want to throw your checklist out the window. <ref>I know, I know — try telling that to the chap who landed his plane on the Hudson thanks to his unflappable compliance with cockpit checklists, right?</ref> | Frequently complicated system risk attenuators can, in fact, aggravate risk situations in complex systems. Alarms going off make it harder to hear; multiple alarms increase panic and obscure each other; an obligation to follow prescribed safety routines can impede quick and surgical response to traumatic situations. There are times, therefore, where you want to throw your checklist out the window. <ref>I know, I know — try telling that to the chap who landed his plane on the Hudson thanks to his unflappable compliance with cockpit checklists, right?</ref> | ||
{{ref}} | {{ref}} |