Making Progress In The Complex Business World
In systems that are: highly complex (large number of variables, known and unknown) and volatile (constantly changing in unpredictable ways). There’s a tremendous and rapid decrease in ROI of studying as a function of time.
I.e. By the time you’d be done calculating how many birds there are in the air right now, it will already have changed.
And that system is only complex, not even volatile, in the sense that you know all the variables: define bird by using the classification used by ornithology. Define ‘in air’ as: birds, not in contact with any surface on earth at t=0.
But that which qualifies as ‘‘bird in air’’ wouldn’t be different at t=25.
Business is different. Success in 1925 is vastly different than success in 2019.
Hell, there are massive differences between 2014 and now.
Business is highly complex. Meaning there are an extraordinary amount of variables you don’t know.
But what’s worse than that large quantity of known unknowns, is all the unknown unknowns.
Now should you have God as a FB friend and you asked him to give you all the data on all those variables, that still wouldn’t solve your problems because business is also volatile.
Meaning: the situation at t=1 can be completely different from t=0 (where you started studying).
As a consequence.. studying the system in order to make a better decision right now, has a strong decrease in ROI.
1. It’s too complicated and
2. By the time you’d be done (not possible), that situation might no longer exists.
This is also my problem with analysts.
Since Youngling & Feynman has already alienated Keynesian economists, macroeconomists, market researchers, and HR departments... I can stand to lose a few more followers.
They’re extraordinary at predicting the past.
Just look at all the manpower and billions of dollars that go into wall street.
Look at hedge funds as a subset, and their performance.
Virtually no one is consistently able to beat the market.
Then if you subtract what you’d expect by random chance/luck you’re left with pretty much no one.
Long story short: learn to be okay with having X% of the info and make a call.
It’s much better to just move and iterate vs. standing still.
*The only exception would be in developing a new pacemaker or smth, where the consequences of failure are death.