Black Swans or Dirty Ducks
Black Swans or Dirty Ducks?
A Retrospective
Challenge the Unchallenged
It’s a duty of risk managers to challenge that which rests unchallenged. Nassim Nicholas Taleb did a great service by popularizing risk concepts in his book, The Black Swan . However, it is easy to get seduced by his enthusiasm, carried away by his pace and miss a few flaws. Over the last six years since it was published The Black Swan has been virtually unchallenged as a standard reference book. However, on closer examination, several of his Black Swans turn out to be more like dirty ducks. So it really is time his book was critically re-examined to discover what it means to risk and business continuity practitioners.
The essence of the Black Swan is that it is an unexpected event that happens or an expected event that does not. Expectations are driven by our knowledge and experience and hence can mislead us. ‘First, it is an outlier, as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility. Second, it carries an extreme impact. Third, in spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable.’
In the introduction to Part One, Umberto Eco’s Antilibrary, Taleb says: ‘Read books are far less valuable than unread ones…..indeed, the more you know, the larger the rows of unread books.’ Considering his skepticism for information, confirmation and corroboration it is interesting to note his 28 pages of bibliography – some 730 presumably read books.
Theories of Risk Perception and Learning
The theory of risk perception has long been established as including a number of factors contributing to our perception and subsequent judgement – identified at Figure 1 below:
Figure 1: Risk Perception – Background Factors
For years, risk theorists have urged us to seek to widen our perception and advised that
A Retrospective
Challenge the Unchallenged
It’s a duty of risk managers to challenge that which rests unchallenged. Nassim Nicholas Taleb did a great service by popularizing risk concepts in his book, The Black Swan . However, it is easy to get seduced by his enthusiasm, carried away by his pace and miss a few flaws. Over the last six years since it was published The Black Swan has been virtually unchallenged as a standard reference book. However, on closer examination, several of his Black Swans turn out to be more like dirty ducks. So it really is time his book was critically re-examined to discover what it means to risk and business continuity practitioners.
The essence of the Black Swan is that it is an unexpected event that happens or an expected event that does not. Expectations are driven by our knowledge and experience and hence can mislead us. ‘First, it is an outlier, as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility. Second, it carries an extreme impact. Third, in spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable.’
In the introduction to Part One, Umberto Eco’s Antilibrary, Taleb says: ‘Read books are far less valuable than unread ones…..indeed, the more you know, the larger the rows of unread books.’ Considering his skepticism for information, confirmation and corroboration it is interesting to note his 28 pages of bibliography – some 730 presumably read books.
Theories of Risk Perception and Learning
The theory of risk perception has long been established as including a number of factors contributing to our perception and subsequent judgement – identified at Figure 1 below:
Figure 1: Risk Perception – Background Factors
For years, risk theorists have urged us to seek to widen our perception and advised that