“The more parts there are, the more things to go wrong,” my Dad muttered, as he slid out from underneath his ’57 Chevy.  It was the same exact metallic salmon color as the one he had before that, down to the plastic-covered bench seats. Actually, every Sunday afternoon, I think he’d just find something on it to unfix, and then fix, on a car he liked for its simplicity.

As a surgeon, he also spent his life fighting nature’s relentless law of entropy, and he’d take each patient’s case personally. Yet, in the end, after a week himself in the ICU and a week before he died, he chuckled at my asking what exactly happened, “ Well, you know, the parts are just old.”  Then for the umpteenth time that it had become a ritual, he asked teasingly about our sending my son Kent to live with them. Dad would have been 87 a week later.

Nature’s like its ocean’s perpetual cycle: perpetually evolving into greater complexities that then break down into elemental pieces.

Charles Perrow says that complexity reaches a level where catastrophic failure is not attributable to any single part but rather to factors created by that complexity itself. Perrow in 1984 published Accidents: Living With High Risk Technologies which the New York Times describes as, “a penetrating study of catastrophes and near catastrophes… writes lucidly…. An outstanding analysis of organizational complexity.” At a certain stage, accidents are “normal” – implication: plan for the inevitable.

In an earlier blog, I referred to how the government, and Wall Street and its quants, seem to never learn the humility that there will never be a final perfect solution. Each solution creates new problems. We need then to step back and hopefully see the new, unprecedented larger “frame” – the new context. Just as programmed trading is the likely cause of the 1987 breakdown in the financial markets, in 2007 there were a few lonely hairshirts warning us about “globalization”. At the time, there were a few voices critical of how the quants were creating actuarial fiction – as if risk can be eliminated by simply insuring against it. Each subsequent derivative layer became more and more abstract. There’s a specious optimism that the economy is saved after saving the largest players; that is simply a start, and the meltdown will take months yet to manifest its broad and deep spiral down into the lowest levels.

What’s the difference between risk-asset insurance, and social security, or the Ponzi-Madoff school for pyramidal architecture, or the Mr. Obama’s massive plans for health, education and alternative-energy spending? Denial is a river in Egypt, quips Dr. Temple Grandin. Pyramids, however, are obviously everywhere the alchemist in us thinks we can invent a perpetually self-renewing resource.

Well, I’d be the last to pretend I saw all this then. I know it’s not as easy as “weshouldaseenitcoming”. But I think the global meltdown argues for vigilance for a larger context, the next larger “frame”. Not just seeking answers, but questioning the question. Clearly delineating roles, where external auditors are not your management advisors; where business leaders aren’t their own regulators; where external and internal roles are kept separate; and, perhaps, in the swing from a free market having all the answers, to a presidential hubris in thinking government has all the answers.  Life is not a straight line; nor even a smooth curve.  I think we get closer to truth if we can accept that life is a jaggedy dialectic:that decision making is a continuing correction of the last decision – as pilots might describe flying.

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This entry was posted Friday, April 3rd, 2009 at 9:01 am and is filed under Strategic Execution. You can leave a response, or trackback from your own site.