Lessons on Competition from Mother Nature

An interesting short article by Joel Barker with some ideas to think about, Surviving the Fittest: New Lessons on Competition from Mother Nature:

As a result of this emerging body of research, we now must reexamine our competitive paradigm and factor in the new information. It is now clear that ‘the fittest’ not only don’t win all the time, but are only a piece of the more complex system. This information can lead to new strategies for small companies and new insights for the big companies that presently dominate their industries.

The idea that what is winning right now is best is flawed. What is successful now is dependent on the larger system and the conditions that impact that system. In the news the last few days British Airways had to shut down flights worldwide. This has happened numerous times for major airlines in the last few years.

view from a train in Rocky Mountain National Park with tree and snow covered mountains in the background

By John Hunter, see more of my trip to Rocky Mountain National Park.

The systems that they settled on may seem to be working well for years and then suffer catastrophic failures. Why did they accept systems that could fail so completely? Given the frequency it is happening numerous competitors are choosing solutions that are too fragile. And it isn’t just one organization doing it, numerous huge airlines (United, Delta, British Airways, Southwest) have found themselves caught in a situation where they fail to deliver what customers pay for due to so complete a failure of their IT system that they cannot fly any planes many hours in a row.

I suppose this could be evidence that designing an IT system for a huge airline is not something that can be done with the reliability we expect from most things (that the business doesn’t have a day every decade or two where they business just can’t operate that day). But I doubt it. It seems much more likely the existing system creates organizations that are more focused on other things than building a reliable, robust IT infrastructure.

A post I wrote on my Curious Cat Science and Engineering blog a few years ago, 500 Year Floods, looked at the problem of making judgements about unknown systems. The concept of 100 and 500 year floods is to help us make decisions about long term planning and risks. Looking at an area to build a building (or city) can be aided by history and seeing what the area has experienced in the past. But you can’t just assume the future will be the same as the past. Systems change over time. What worked in the past doesn’t necessarily work well in the future.

And as I mentioned in my article, our evidence and understanding also changes (hopefully by us gaining more knowledge and gaining a clearer understanding as we learn more). Thinking systemically takes into account the impact of interactions on results. Results are not independent of the circumstances.

Too often I see simplistic thinking used to accept that the results were good so what we did was wise or the results were bad so what we did was unwise. Sometimes those conclusions have merit. Sometimes they don’t. The results matter but understanding the nature of those results is important. Was it due to luck (did our company due well because the overall market boomed and we were taken along for the ride). Was it due to taking risks that happened to work out well now but is likely to result in bad results in the future? Is it just random variation that we attribute to good luck?

Results matter but they do not determine if the actions taken were wise. If I gamble my entire retirement on one stock I may get rich. But even if that happened it wouldn’t make that a wise choice. To evaluate results you need to think more deeply than did the results prove it was wise or not.

Related: Leadership While Viewing the Organization as a SystemRoot Cause, Interactions, Robustness and Design of ExperimentsInvestment Risk Matters Most as Part of a Portfolio, Rather than in IsolationHow to Use Data and Avoid Being Mislead by DataParadigms: The Business of Discovering the Future by Joel Barker – Bad Weather is Part of the Transportation SystemPoor Airline QualityA Good Management System is Robust and Continually Improving

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