Fragile vs Anti-fragile Business

August 4, 2013 — Leave a comment

An interesting post from Don Peppers in LinkedIn today on how fragile or otherwise a business is brought my attention to this book “Antifragile: Things that gain from disorder“. I’ve been following Don Peppers since his classic book “The One to One Future” but this is something else.

We probably understood “fragility” but what’s “anti-fragile” especially from a business context? Taleb, the author of the above book states that “anti-fragile” is that category of things that not only gain from chaos but need it in order to survive and flourish.

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I’ll leave you to read Don’s mini-review of the book and Taleb’s concept, but what caught my eye is how the concept of the fragile vs anti-fragile is summarized into…

  • Debt and leverage make you fragile. Redundancy reduces fragility.
  • Having no options increases fragility. “Optionality” leads to antifragility.
  • Top-down planning is fragile. Bottom-up thinking is antifragile.
  • Salaried employees are fragile. Self-employed workers are antifragile.
  • Big government makes a nation fragile. Local governments make it antifragile.

The 3rd & 4th points underline the importance of moving from a top-down hierarchy to one where self-organized individuals are able to shape the directions of an organization (Agile? Lean startup?). To achieve this shift is not a simple matter of announcing to all and one that we are going bottom-up thinking and everyone’s now responsible for the direction of the business. If you do that without having the right people in place, you are merely accelerating your organization towards fragility.

You might ask if you work in a large MNC, how do you change salaried employees into self-employed workers? Well, you can’t (not unless you are planning to become another SEMCO). It’s not so much whether a person is salaried employee or self-employed from the payroll perspective, but whether he thinks like a “salaried employee” (rented car thinking) or “self-employed entrepreneur”.

To make that switch, you need to build a team of individuals who not only understand what the organization’s mission is but actually buys in actively into that mission and make it theirs! When you have reached that stage and needs a prompt, maybe it’s a good time to re-read Taleb’s book on Antifragile. 😛

I’m certainly picking up a copy for myself.

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