An atomic theory of business size


Now, anyone who has read my blog before, knows that I adore the consistent simplicity and wisdom of Seth Godin. But he really has stuck it to me this time! For almost 2 weeks I have been working on a blog article about this very subject (and a bit more). Please understand that am not  talking about every hour of every day or even every other day but I just can’t get it right. I’m still not happy with it!

I just have to content myself with other efforts that have worked.

Anyway, until I get my act together and unleash THE article that explains a penny or  £1 as “information agents”, deals with mickles, mackles, fractals, self-similarity and recruitment, you will just have to make do with Seth’s words…definitely a simplified version. Maybe that’s where I have been going wrong!?

Drat. Damn you Seth Godin!!!

The magic of the periodic table is that every atom is one thing or another–there isn’t a stable element that’s sort of oxygen and sort of nitrogen. If there were, there would be millions of elements, not a few hundred.

 

That’s because electrons are (more or less) either here or there. The quantum levels ensure that there are no weird hybrids.

A business follows a similar model. A local mom and pop store is just the right size for mom and for pop. The rent is low enough for the two of them to cover it. It’s stable. They can’t afford a $200,000 a year CFO. It wouldn’t be a stable situation. Read more of this post

More evidence of the need for cultural change (via Get “fit for randomness” [with Ontonix UK])


This article was originally published in June 2010 but what’s changed?

More evidence of the need for cultural change   Image via Wikipedia We already know, from the number of cases that have been exposed in the last few years, how banks, oil companies, insurers, aerospace, construction, motor manufacturers, Politicians, even nations and Churches have misrepresented themselves. Preferring to spend [and spend big] to create and maintain the illusion of respectability, quality, integrity, even piety!  Employees becoming dis-engaged. Prudent and dissenting voi … Read More

via Get "fit for randomness" [with Ontonix UK]

Interest rates: uncertainty leaves consumers unsure over what move to make


Human nature is such that we would prefer an incorrect (but reassuring) model of the future to uncertainty! Would that still be the case if the level of appreciation “causality” and complex systems were improved?

I loved this quote about three inter-related factors: risk;  complexity; uncertainty, from a recent discussion:

“We do not want to deal with the fact that we cannot know. Rather than accepting that fact we spend a lot of money, time, effort to generate the appearance of knowing, versus taking action and making sure we have flexibility to deal with what arises when we go on a path towards a goal we desire. Humans like to act with certainty even if it is delusional. One of the things that makes a great leader is a person that understands the uncertainty and is willing to deal with the path to the goal as the situation unfolds.”

Do the “indecisive” have any basis for faith in receiving “expert advice” from FS firms…unless it comes from an individual of impeccable and verifiable credentials earned over the last 20 years

With inflation roaring up to 4% on the Consumer Prices Index and an indecisive policy stance from the Bank of England consumers in general face more uncertainty than ever when making crucial financial decisions. This means that they will increasingly need to look for expert advice, giving an opportunity for providers of financial services…

via Datamonitor Research Store – Interest rates: uncertainty leaves consumers unsure over what.

“Disaster myopia”: Failing to learn the lessons of increased uncertainty


From Andy Haldane at Bank of England in ft.com:

People tend to forget events that happened a long time ago and give much less weight to the probability that these will happen again. This “disaster myopia” led to models that hid the true probability of some disasters. A further look back into history would have shown fluctuations in UK GDP four times greater than that of the past 10 years, that of unemployment five times greater, that of inflation seven times greater and that of earnings 12 times greater.

The following is an extract from (with link to) my original article

Financial or physical loss doesn’t only stem from “risk”! Risk we know a lot about. Dare I say that we understand, can quantify and manage risk? I would add one caveat though. Much of the accumulated data upon which probability and, therefore, rating is calculated, relates to a period which bears little resemblance to the world and civilisation as it is today…or will be in the future. So what about the murky world of uncertainty that lies beyond … Read More

via Get “fit for randomness” [with Ontonix UK]

Complexity lessons from nature for a better economic future…


Here is a very brief snippet from a recent article in ft.com. The writers, who form an, apparently, unlikely combination, are Andy Haldane, Executive Director for financial stability at the Bank of England, and Robert May, Professor of Zoology at Oxford University and former British chief scientific adviser.

You shouldn’t really be too surprised because, increasingly in “Corporate America” the realisation is that, rather than environmentalists and others who push a “Sustainability agenda” being the enemy, they have learned through their own performance that embracing Strategy for Sustainability IS transforming their results. And not just because “green washing” was so costly or that their “educated” customers are spending more but because it is genuinely better for their business, stakeholders and the environment.

Nor is this the first time that these unlikely bed-fellows have attempted to communicate a message so important that it is cultivating increasingly inter-disciplinary approaches – joined-up thinking. This is familiar territory for Ontonix. It highlights why Complexity Theory and systems-thinking are THE point at which a new understanding can be applied to begin the process of recovery…this quote may help your understanding of why complexity is so important:

”Imagine assessing the robustness of the electricity grid with data on power stations but not on the power lines connecting them”

.”..The present situation in banking is in many respects perverse. The magic of diversification, when assumed into banks’ risk models, means that large, complex banks often hold less capital than their smaller, simpler brethren. The rocket-scientists building models tell us this makes sense. But the rocket-scientists building rockets tell us it is nonsense. This error has cost the world dear. Through this year, the Financial Stability Board is leading the charge to boost loss-absorbing capital for the largest, systemically important institutions to correct this error. It is right to do so.”

Fund Strategy Magazine: Complexity lessons from nature for a better economic future… In case you thought that “complexity management” is just more mumbo jumbo from the financial sector I suggest that you read the following piece and any of my previous blogs on the subject of complexity. Complexity analysis, mapping and management is available NOW and, if a business leader is intent upon gaining a greater insight into their operations, making more informed decisions, managing more effectively, gaining competitive advantage and “st … Read More

via Get “fit for randomness” [with Ontonix UK]