Improving our ability to navigate macro volatility in a world where we can’t predict it

A final few links and observations as we close 2022 on the skills we need to develop if we are to safely and successfully navigate complexity and macro-level volatility.

From Tochka-Us to Twitterdammerung in 2022 I am not going to make the mistake of trying to predict what will happen in 2023. It’s a fools errand. But as an alternative to predictive powers, there are more useful skills to cultivate as leaders, makers and innovators that might help us thrive whatever the next year throws at us. During what felt like peak pandemic a year or more ago, if somebody had asked how I expected to spend my time in 2022, ‘watching Ukrainian drone strike POV videos set to a speed metal soundtrack’ would not have been high on my list, but there you go. Predicting the future is hard, and right now, probably fatuous. I enjoyed Daniel Goodwin’s recent piece about the apparent paradox that macro change is becoming harder to predict at the same time as we are getting so much better at modelling the micro – and his observation that the hardest aspects to model are proving to be the most influential. He starts with Ukraine, Taiwan, FTX and SBF, the Twitterdammerung, etc, as you might expect, but then goes on to think about science and technology, and the potential impact of high-agency individuals and small groups in a highly connected world, and how we adapt our institutions to these threats and risks.

“If the world is to become more and more unpredictable, then the predictable parts are in danger of having less and less impact. If we appreciate the magnitude of how much technology has developed (go play with ChatGPT if you haven’t yet) then we must act with urgency to adapt our systems and institutions, especially for personal development (aka education) and scientific research.”

As Noah Smith wrote this week: “Great powers are on the move again, strategic industries matter, trade is an arm of geostrategy, and we all have to think about geopolitics and conflict.”
Mapping and macro uncertainty But this macro volatility is not just a geo-politics issue. Macro analysts in finance, economics, supply chains, science,  and other fields have had just as hard a time predicting what might come next. Stable, dominant German heavy industry turned out to have been built on cheap Russian energy. World-beating European suppliers of semi-conductor fabrication equipment are blocked in key markets by US foreign and industrial policy, and feeling the pain. And let’s not forget that a virus from Wuhan got us all to stay home for many months, but the world kept turning, only without the same reverence for ‘jobs’ and ‘offices’ as it had before. Anything is possible, but not always in a good way. Of course, in the last couple of weeks of this year of accelerated global weirding, there will be no shortage of 2023 predictions for business articles, but we should expect that macro winds will likely blow some of these predictable micro developments off course once again. And these are precisely the issues less amenable to modelling that Daniel Goodwin was referring to above – they are complex, not just complicated. Navigating complexity So instead of prediction, we need navigation and sense making. One of Dave Snowden’s many useful insights is the idea that the best way to understand complexity is often to act first, by probing, rather than just to speculate or plan, and see what you can learn. Rather than predict the future, we should try to cultivate organisations and institutions that can navigate it more effectively. We need leaders who are explorers, rather than the ‘strong men’ Gideon Rachman wrote about this week in the Financial Times, who were each tempted this year towards the rocks of calamity by the sirens of their own hubris and arrogance. Explorers navigate and are open to new information, and they create maps that are more like charts of newly discovered lands, rather than top-down org charts or ideological overlays to reality. Organisational and ecosystem mapping is evolving, but I expect it to become a more important tool in general as we learn more about navigating complexity. Mapping often starts with basic information gathering about the components of a system and how they inter-relate. So instead of just Social Network Analysis that charts nodes, edges and perhaps relationships, we also need to think about interfaces, data flows, dependencies and other properties of distributed systems and try to catalogue them, as Jason Clarke writes from a technical architecture perspective. Make worlds not war I have been playing a lot of Xbox recently researching how open world games use maps to both orient, summarise and motivate action. The field of video games is rich with lessons and examples about how to immerse people in a constructed world and motivate them to spend hours obsessively working to solve problems, collaborate and learn how to improve their skills. Open world games already do a pretty good job of mapping, with large areas that are gradually uncovered as players make progress in missions or exploration. If we want to create our own domains of action, whether as a company, a movement or a state, then we also need better world builders and story tellers in addition to map makers and explorers. As Nicholas Moryl writes, we need leaders to think like game or world designers:

“The art of designing a video game is the art of designing context and incentives that enables a player to achieve a goal. That’s all it is.” “If you create context effectively you’re more likely to have your high performers find jobs to do and problems to solve that are actually aligned with the company’s goals. With the right information environment, teams understand both the big picture business context (what matters to the company right now and why) as well as the constraints you’re operating within … As a result any free cycles they have for work are more likely to be channeled towards productive endeavors rather than dead ends …  Context creates leverage.”

Pace layers and timing Finally, if we want to create the possibility of action in a complex system or world, in addition to mapping, we also need better ways to think about where and when to act. Two key related concepts we use a lot in thinking about change in complex conditions are pace layers and timing. Pace layers is the idea popularised by Stewart Brand, drawn from architecture, that says any system (from a building to a tech stack to human culture and society) is made up of a series of shearing layers that move at different speeds – typically the lower level layers (foundations or the shell of a building) change much more slowly than the layers above them (fit-out and sub-divisions) and those at the top of the stack change fastest and most often (decor, furniture, etc.) Understanding the variable layers of a system is important if we want to know how things are connected, and where we might want to act. Clay Parker Jones recently posted about how this can help us improve personal and organisational learning, by anchoring skills matrices in the organisational pace layers they relate to. I think this simple observation is potentially quite useful in helping to plan learning needs better, rather than either always being behind the curve or too focused on ‘new’ fast changing skills at the expense of the basics that don’t change as rapidly. And of course, the leadership skill or attribute that really shows the value of experience is … timing. Knowing where to probe or act in a complex system to influence change is important, but knowing when to act and when to wait is often what makes the key difference, as the often mis-attributed quote “Don’t just do something, stand there!” suggests. I believe time is fungible and, to some extent, elastic … so I was delighted to read NPR’s piece this week Researchers say time is an illusion. So why are we all obsessed with it? about how we measure and track time. So for a final link in 2022’s last Link*Log, here is Venkatesh Rao’s collection of posts that informed his book Tempo, over a decade ago, about timing, tactics and strategy in narrative-based decision making, plus a quote from the book that perhaps sums up the macro volatility of 2022 (via LittleFutures):

“Narrative rationality deals with decisions against the backdrop of an appropriate narrative time, measured by an appropriate narrative clock. As Lenin once remarked, “There are decades where nothing happens; and there are weeks where decades happen”

Photo by Aaron Burden on Unsplash