Trade-Off :: Financial System Supply-Chain Cross-Contagion [Dr David Korowicz]


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I first came across the work of Dr David Korowicz a couple of years ago and was sufficiently enthused that I wrote this article: All you could ever want to know about why complexity is THE big deal

David described his paper, Tipping Point to me as “an attempt to describe globalised complexity in more popular form”. I said then that I thought it went, significantly beyond that!

So, you can imagine how honoured I was to be invited to preview his latest work:

Trade-Off

Financial System Supply-Chain Cross-Contagion: a study in global systemic collapse

Since reading the draft version I have been desperate to share it with my colleagues and contacts! Read more of this post

SAP Users:: seize competitive advantage–manage Complexity at enterprise level


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Understanding something as abstract as complexity is difficult!

That situation is not helped with all the other, daily, tasks that take on increased significance in tough trading conditions.

If you have looked into the subject at all, you will know that there is no shortage of major Consulting firms willing (if not able) to “help”. Of course each is very keen to offer their own interpretation and particular brand of solution to, what is (thankfully) now recognised as a source of risk, that, unmanaged, degrades profitability, adds to systemic risk and financial uncertainty.

The task of managing complexity is not made any easier when you consider that there is no single [universal] definition of complexity and that conventional risk management tools and statistical analyses CANNOT identify, measure or map, the hidden information structure that is contained within the data that an enterprise generates as it functions.

That’s right, the “task” begins, as it should, you: USE THE DATA YOU ALREADY HAVE!

A recent article, by SAP, on the subject of Complexity can be found here.

Read more of this post

The supply chain disappointment – Insurance Insight


As supply chain risks rise up the agenda for businesses, there is clearly an opportunity for insurers to step in with up-to-the-minute solutions that respond to new challenges. Dequae believes while the risks have changed, “the insurance solutions have not really adapted to the changes in the supply chains”. She points, in particular, to the need for innovation when it comes to “more coverage and capacity”, as well as broader conditions and “coverage at acceptable prices”.

via The supply chain disappointment – Insurance Insight.

I have become used to some of my more “critical” comments not making it past moderators who are overly-sensitive to the potential for political repercussions.  So here it is:

supply_chain_diagramAnyone who has given the subject matter some thought knows, broadly, what the problems are. Some even know of available solutions. But NONE have acted to seize the competitive advantage that “embedding” solutions as part of their proposition! Read more of this post

FM Global "steal" the initiative whilst others dither – Insurance Insight


It is very rare to read about meaningful innovation, from an insurer, that is about anticipating and responding to policyholder needs but that is exactly what FM Global appear to have done. Well done to FMG and I sincerely hope that they reap the reward of competitive advantage, that such a rare development merits. BUT I do have my concerns.

Whilst it is not for me to question if they know what they are doing…as far as offering protection and reassurance to their customers they undoubtedly do…I wonder about the timing. Perhaps they have overcome concerns about the current turbulence in the global economy OR have decided to pursue a bold strategy right out of the Warren Buffett handbook: “be greedy when others are fearful and fearful when others are greedy”, so plan to be perfectly placed to capitalise upon the lessons that must be learnt following another credit crunch – i.e. the realisation that price is only one metric and that risk management does not = resilience management! Read more of this post

Complexity Management: Improve Profitability & Reduce Risk – Forbes


From my experience the majority of people fall into two “camps”. The one’s who claim they know about complexity and already “deal with it” or those who admit to knowing nothing/very little about it and do nothing. What both tend to have in common is that neither can define the problem, explain current/possible solutions.

NONE are able to quantify the impact of the problem upon their profitability or risk profile.

There is very little understanding that unforeseen and unforeseeable are not the same thing. Read more of this post