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Recommended Resource – The Black Swan

StrategyDriven Book ReviewThe Black Swan: The Impact of the Highly Improbable

by Nassim Nicholas Taleb

Black swan events are by definition unpredictable, catastrophic, and retrospectively believed to have been fully predictable and by extension less impactful.

About the Reference

In his book, The Black Swan: The Impact of the Highly Improbable, Dr. Nassim Nicholas Taleb illustrates the truly unpredictable nature of black swan events. He shows how the limits of human imagination and available information hide the possibility of these events from us regardless of the retrospective assertions made by ‘the experts.’ Dr. Taleb goes on to reveal micro-level black swans that influence the day-to-day success and failure of companies and individual employees.

Benefits of Using this Reference

The Black Swan brings to the forefront the reality of unpredictable events. Through his proof of their existence, Dr. Taleb creates a mandate for executives and managers to examine and prepare their organization to deal with black swan events at the corporate and employee level.

The one shortcoming of Dr. Taleb’s book is the absence of a set of guiding protocols or principles for effectively dealing with black swan events once they occur. This remains as an outstanding research and development project for the reader with no initial direction provided.

StrategyDriven likes The Black Swan for its exposure of unpredictable events and the inferred call to action to prepare one’s organization to deal with these catastrophes commensurate with the organization’s overall risk profile; making The Black Swan a StrategyDriven recommended read.

Decision-Making Best Practice 14 – Balanced Use of Knowledge and Experience

StrategyDriven Decision Making ArticleIt’s the age old question of which is more valuable, knowledge or experience. Those arguing for experience rightfully suggest that ‘the numbers’ can be deceiving and that the nuances of a given circumstance – unaccounted for by broadly applicable models and high-level, quantitative facts – often dictate the best course of action. Those favoring knowledge would argue that no two situations are exactly alike and that the underlying nuanced conditions providing success in the past likely went unrecognized and represent the very differences that will cause an experienced-based decision to go awry. The question is, Who is right? – those favoring knowledge or those favoring experience? Our answer is neither and both. We believe the best decisions are made using a well-proportioned blend of both knowledge and experience.


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Alternative Selection Best Practice 3 – Reality Check

Just because the numbers look good doesn’t mean you should move forward with the initiative.

Leaders often face the dilemma of having numerous attractive initiative options to pursue when developing their strategic plans. Many of these options are provided by an eager and engaged workforce; individuals who diligently examine the proposed opportunity, associated costs, and make the strong case for pursuing these cost saving and/or profitable efforts. However, it is the responsibility of the leadership team to perform a reality check on these proposals in two ways. First, is a critical questioning of the numbers to ensure the real-world appropriateness of the assumptions used and the numbers presented. Second, is the assessment of whether the proposal can be executed considering the organization’s resources and capabilities.


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Decisions are Never Emotional

StrategyDriven Decision Making ArticleImagine if instead of believing that unexpected decisions are emotional, we assume they have a very specific reason, even if we don’t understand or agree. Then what? Is it just easier to believe the other person to be irrational?

Decision-Makers Must Comply with Their System

Because decision-makers take actions that outsiders regularly believe to be ‘irrational’, we say that they are either ’stupid’ or making an ‘emotional’ decision. Neuroscientists call these decisions irrational or emotional as well. But we – the outsiders and neuroscientists – are rather biased: we see a problem, believe we know the solution, and consider our solution to be the best because it’s the most rational. We forget that every person, every group or family, every system if you will, has a very unique and idiosyncratic set of beliefs and criteria that determine their choices. And what may look irrational from the outside is very, very rational on the inside, even if sometimes unconscious.

Indeed, before anyone makes any decision, they consider it against their own beliefs. Would you walk over to a stranger in a park and harm him? No? Why not? That would be an emotional, irrational decision. But you wouldn’t do it because you have internal, unconscious beliefs and values that wouldn’t allow you to harm another person – especially a stranger.

No one makes decisions outside of their beliefs. The internal, private ’system’ that makes up our functioning rules (as individuals or groups) is sacrosanct, and if any decision might render the system useless, or ‘less-than,’ then another decision will be made. And outsiders cannot understand what’s going or become a part of that decision because, well, because they are outsiders.

If you were going to start working out daily, you’d have to either get up earlier or move something else in your schedule around. You’d have to probably start considering to eat healthier, and maybe stop having so many sugary drinks. It’s not about the gym, or about the weights; it’s about your system and how it’s willing to change so it all becomes a seamless whole that operates in tandem to serve you.

Decision-makers live in a unique system of rules and roles and relationships, history and initiatives, feelings and vendors and budgets. Change anything and everything else gets touched in some way. Before decision-makers decide, they must figure out how to manage all this so it ends up butter-side-up; understanding their needs, doing SPIN or Sandler or Relationship sales, or or or, only manages the problem end of the decision – the very, very last action that decision-makers need to take – AFTER they’ve managed their systems change bits. And again, no matter what we ask or what we are told, we can never, ever understand someone else’s system, just as they can’t understand ours.


About the Author

Sharon Drew Morgen is founder of Morgen Facilitations, Inc. (www.newsalesparadigm.com). She is the visionary behind Buying Facilitation®, the decision facilitation model that enables people to change with integrity. A pioneer who has spoken about, written about, and taught the skills to help buyers buy, she is the author of the acclaimed New York Times Business Bestseller Selling with Integrity and the new book Dirty Little Secrets: Why buyers can’t buy and sellers can’t sell and what you can do about it. She lives in Austin, Texas.

Decision-Making Best Practice 12 – Diverse, Redundant Data Sources

StrategyDriven Decision Making ArticleData serves as the foundation of every decision. Combinations of data bits are logically joined to form the packets of information upon which decisions are made and actions taken. Without quality data, the probability of making the right decision is greatly diminished. Increasing data accuracy is subsequently paramount to improving decision quality.


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