Don’t (just) believe your eyes:: heuristics + complexity = guesswork

The perils of making assumptions about the integrity of an object, individual, entity, etc. are beautifully summed up in the familiar expression “never judge a book by its cover”! Despite this knowledge, I will guarantee that we have all done it, regretted it, learnt a (sometimes painful) lesson and moved on. But that still doesn’t stop us from making misjudgements again and again in our daily lives. It’s human nature. Heuristics is a very useful ally to marketers as they can exploit it to “mask a multitude of sins”!

We need to be aware of our own limitations when it comes to dealing with the highly complex. And it doesn’t get more complex than the human body or the digital world of molecular engineering and nano technology. Hence the brief science lesson:

In excess of 99.9% of the “Electromagnetic Spectrum” (below) is outwith our visible spectrum i.e. it is hidden or “invisible” but it is there and it contains information that could, literally, make the difference between life or death!

Dave Snowden:: anticipatory awareness – seizing opportunity avoiding threats

At Ontonix we talk about “crisis anticipation” but, I suppose, anticipatory awareness has a certain ring to it AND reflects the potential to identify both THREATS and OPPORTUNITIES…developing an informational advantage into a competitive advantage!

Moving from “fail-safe” systems to multiple sub-systems that are safe-to-fail

However, the most important thing is to recognise organisations for the, dynamic, COMPLEX SYSTEMS they have become. Attempts to manage performance and risk with tools and techniques that may have facilitated construction of “complicated machines” are dangerously inadequate…hence the increased need for an early warning mechanism.

Wanted: Chief Complexity Reduction Officer – Forbes

Please don’t make the mistake that Ron has identified in this article i.e. assume that he is talking about some other company! He isn’t he is talking about yours.

…If your assumption is that complexity comes largely from external factors like globalization and unexpected crises, then your only recourse is to be reactive. And when eventually things don’t go well, pegging the blame on complexity — although convenient — is a high-level form of victim mentality.

On the other hand if you acknowledge that some amount of complexity is self-generated — in the way that we structure and manage our organizations — then you can take action.

The reality is that high degrees of internal complexity significantly reduce an organization’s ability to respond effectively to complex, unanticipated events…

via Wanted: Chief Complexity Reduction Officer – Forbes.

If it wasn’t for the popular myth that the “downside of risk” is something that is exogenous [external] we would have more, better and profitable businesses; more stable economies and less volatile markets!

So, presumably, you expect some kind of justification for this statement?

Ontonix and CUBEXX Offer Complexity Management in SAP’s Business Warehouse

Ontonix and Cubexx announce integration services which will allow users of SAP’s Business Warehouse to perform Enterprise-level Quantitative Complexity Management Analysis. “Given the importance of complexity in today’s turbulent economy and due to its impact on business exposure and profitability, it is our goal to make our technology available to as many corporations as possible” said Dr. J. Marczyk, Founder and Chief Technical Officer of Ontonix. “In collaboration with Cubexx we have developed a framework for performing large-scale and broad-scope complexity analysis which allows companies to view strategic risk and business intelligence from a perspective which is in line with our turbulent times” he concluded. Download flyer.

Madrid-based Cubexx Solutions, S.L. is a company which is specialised in finding and creating solutions around the SAP solution framework and with the objective of improving the support of business processes. Read more about Cubexx here.

Ontonix, a privately held company established in 2005, develops award-winning software and offers exclusive high added value services in the field of quantitative complexity management. OntoSpace™, the company’s flagship product, is the world’s first complexity quantification and management system. The unique approach to complexity and its quantification that is available in OntoSpace™ establishes radically innovative means of crisis-anticipation, Strategic Business and Economic Intelligence, holistic risk rating and risk management. Ontonix also offers a first-of-a-kind on-line service which enables its customers to perform near real-time self-rating, allowing one to measure the resilience and verify the state-of-health of corporations, organisations, asset portfolios, or any kind of business.

For additional information on Ontonix and its services, write to us at david@ontonix.com (UK) or info@ontonix.com

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Establishing “cause and effect”: don’t be misled

Nobel Prize winner Sir Paul Nurse reassures us all that establishing causality in complex systems is far from straightforward. As he points out and is readily understood, there is no doubting that biology and weather present “obvious” challenges in this regard but this isn’t only the case in nature!

BBC Horizon: Extract from an excellent series–causality PLAY FROM 7:50 ONWARD

It isn’t much more straightforward when it comes to complex business or financial systems…no matter what the “experts” (who inevitably have a vested interest) would have us believe.

“High complexity is incompatible with high precision” – this is known as L. Zadeh’s Principle of Incompatibility.

Few would argue that our globalised economy, markets, supply chains, global banking, web & IT infrastructures are highly complex. Although, undoubtedly, the  scale is different but it is also the case that relatively “small” businesses are also reliant upon the successful interaction of multiple (internal and internal – external) functions, ALL interacting within turbulent and unpredictable environments. As a result (and in accordance with Zadeh’s Principle – above)  the ability to reliably forecast, to predict future outcomes and returns is lost…as is the ability to track causality.

However, all is not lost! BUT opportunity does require a preparedness to challenge belief systems built over many years, embrace some new technology, some scientific facts and a manner of thinking that is as old as the planet: there are lessons for business leaders to learn by viewing businesses as systems and interrogating the data in ways that reveal new and invaluable information.