A practitioners guide to resilience.

The next Cynefin retreat will be focused on resilience. In preparation for the retreat Dave Snowden has just published a nice article on resilience.

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After publishing “Commitment”, Olav Maassen and myself (and Jabe Bloom in the USA) delivered a number of sessions and keynotes on Real Options. Anyone who attended those sessions will know that resilience is a major theme in Real Options and Risk Management. In our presentation, Olav and I present a simplified, practitioner’s view of resilience.

if (timeToRecover > timeYouCanSurvive)

{

     you DIE!

}

Which means you need more options!

Don’t waste time, monitor the conditions!

Although our presentation focuses on IT systems, the definition applies to many systems including biological systems. Any definition of resilience needs to consider time as a core measure. The human body is resilient within a certain time scale. Humans can survive massive blood loss or loss of oxygen, but only for a very brief period of time.

Consider some other resilient biological systems. MRSA are bacteria that resist even the strongest of anti-biolitics. MRSA are resilient because some bacteria were either mutants that survived the blast or were at the edge of the assault and survived to give themselves time to exapt, adapt or evolve.

An interesting aspect of resilience is identity. If we consider the financial system during and after the 2008 credit (liquidity) crunch, the financial system survived. However, the identities within the system have changed. Many of the people in the system lost their jobs but subsequently found new jobs with a new identity. A few banks failed, most notably Lehmann Brothers, but in reality very few banks actually failed, or ceased to exist. Rather than fail, many banks lost their identity as they were absorbed into other organisations (Bank of Scotland into Lloyds, Royal Bank of Scotland into the UK Government, Merrill Lynch into Bank of America, Bear Sterns in JP Morgan and many others).

As the Cynefin retreaters gather to discuss resilience, they need to consider the important of time. Reducing the time from a threat emerging to it being detected. Reducing the time from identify a threat to making a commitment (Boyd’s OODA loop). The time from decision to action (Liquidity).

The Cynefin retreaters also need to consider the scale of failure of a system. Whether it is individuals, identities or systems.

As a final thought, the human race currently faces a number of species threatening scenarios of our own cause. Whether its the temperature of the atmosphere, micro-plastics in the oceans, estrogen in the food supply or SAFE and LESS, something could threaten the species. Like our MRSA bacteria, some humans are likely to survive. The ones that do are likely to be the most resilient, the most lucky, and the ones with the most options. The ones with the highest centrality in the network are likely to be the ones to react first, the ones that are most likely to lucky. That assumes that their high centrality means they are not the first to be exposed to the threat, like the MRSA bacteria.

Whenever we think of resilience, we oft hear the phrase… “That which does not kill us, only makes us stronger”. I think that that depends on context.

About theitriskmanager

A IT programme manager specialising in delivering trading and risk management systems in Investment Banks. I achieve this by focusing on risk rather than cost. A focus on costs can lead to increased costs. View all posts by theitriskmanager

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