X-Events. The Collapse of Everything

Author: John Casti

The book is written “For the connoisseurs of unknown unknowns” and is divided into three parts.

The first part – Why ‘normal’ is not normal anymore – talks about complexity theory. The complexity theory means that each issue has two (or more) sides, for example a service delivery of an organization has an organization side and a customer side. Both have a certain degree of complexity. Without going into the definitions of complexity here, but from the gut feeling, we can view the delivery of electricity in the USA as an obvious example. We can say that the demand side is very complex: different quantities, different times, different needs that have grown throughout history as a very complex system. But there is an outdated infrastructure that has a low complexity with regard to the current state of technology. Between both complexity levels there is a gap, which according to the complexity theory is a source of vulnerabilities, and can trigger an extreme event to correct the system. For example, a blackout. This example is a simple illustration of the theory, which is obvious. The best solution for the continuity of the customer side and the supplier side in this case is an increase of the complexity on the supplier side, until it equals that of the customer side. In other words, a technical upgrade.

The first part ends with seven complexity principles:
– Complexity: Main characteristic
– Emergence: The whole is not equal to the sum of the parts
– Red Queen hypothesis: Evolve to survive
– For nothing the sun sets: Exchange between efficiency and resilience
– Goldilocks principle: Freedom levels are ‘just right’
– Incomplete: Only logic is not enough
– Butterfly effect: Small changes can have huge consequences
– The law of the required variety (this is the somewhat important one): Only complexity can control complexity

Part two is a collection of 11 chapters, each of which deals with a separate case, in which the complexity gap is shown each time and how a disaster can arise from it.

In part three, the author argues that the breadth of the gap or the excess of complexity can be seen as a new way of quantifying the risk of an extreme event. This, however, without really going into formulas.

Finally, the author determines three principles with which the gap can be made smaller or can be prevented.

– A first principle is that systems and people must be as adaptive as possible. Because the future is unprecedented but increasingly dangerous, it is wise to develop the infrastructures with a large degree of freedom, to be able to counter or use what you encounter.

– The second aspect, resilience, is closely related to the first principle, that of adaptation. With this you can not only collect hits but also take advantage of them.

– The third principle is redundancy. This is a proven method in the security sciences to keep a system or infrastructure going when faced with unknown unforeseeable and foreseeable shocks. Actually this is about extra capacity that is available when, for example, a defect occurs.

Exponential Organizations

Authors: Salim Ismail; Michael S. Malone; Yuri Van Geest

Humanity has been busy with productivity since time immemorial. Production provided people with scarce resources that were / are worth a lot due to their scarcity. In the last decade, the Internet has come to the forefront, including the concept of “Creative Destruction” and “disruptive technology”. The big companies usually thought about the Internet 15 years ago as “something that is a phenomenon of time”. Nowadays, after an explanation about exponential organizations, they realize that the internet is a phenomenon that is the beginning of everything.

But what are they, those “Exponential organizations”?

It is usually small organizations that make use of the latest technology to come up with new solutions for market demands, for which solutions sometimes already exist. Through the new application they conquer the market in a very short time, in an exponential way. Examples include smartphones and tablets, which have given the photography and the paper newspaper world a problem.

The “nice thing” about this phenomenon is that because technology has become common good, an adolescent in a garage can do an invention that can turn the world of a gigantic company with thousands of employees upside down in a very short time.

That is why it is important that all organizations transform themselves into exponential organizations and tackle themselves disruptively. Because if they do not do it themselves, someone else will. Hence disruption as a means to do risk management and business continuity.

In the book, which is the result of a study by SU (Singularity University), the authors give a number of points of interest. These are given by the mnemonics MTP, SCALE and IDEAS.

Very important is that in contrast to large monoliths the small ExOs are very Lean and Mean organized. The book does not go very deep on this, but large monoliths can also benefit from their advantages by collaborating with existing ExOs or by creating ExOs at the borders of their organization.