Forget the Black Swan: focus on the Rhino
by Miriam Meckel

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In the midst of the perfect storm, driven by a global pandemic and the concomitant economic crisis, managers have to deal with an abundance of challenges popping up day to day. “No time for strategy and planning” is a frequently overheard claim in executive offices and boardrooms these days. Many leaders like to address the pandemic as a “Black Swan”. A nice try to excuse oneself from thorough and critical thinking.

In his book of the same name, US risk analyst Nassim Nicholas Taleb defines a Black Swan as an event determined by three criteria: it is extremely rare, very impactful and can only be explained in retrospect. In this sense, the animal has also established itself as a popular mythical creature on the list of justifications for bad decision-making.

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Facing up to dangers: a question of will, not ability

Yet the truth is that most of the time we are not dealing with a Black Swan, but with a “Grey Rhino”. To see it is not a question of ability, but of will. US author Michele Wucker describes the rhino as a phenomenon that embodies the dangers of our time. Anyone who dares to take a closer look will recognize it.

Such is the case with Covid-19. In 2012, a risk analysis study by the German government presented  comprehensive documentation of a possible “pandemic caused by a virus Modi-SARS”. The Robert Koch Institute, the country’s disease control and prevention organization, together with other federal authorities developed a scenario of six million Germans falling ill at the peak of an imagined crisis. The rhinoceros thus identified has stood unnoticed ever since. 

US tech entrepreneur Bill Gates warned in a 2015 TED talk that the greatest threat that mankind faced was a virus epidemic. And as recently as 2019, US government agencies ran a full-scale simulation code-named Crimson Contagion bearing a frightening resemblance to the coronavirus crisis. There it was again, the big grey animal, in plain sight.

Ask the right questions

One lesson of COVID-19 is that leadership will need to change dramatically to face up to such threats in the future. The coronavirus might be a particularly severe crisis, but in an unstable world it certainly won’t be the last. As the pandemic recedes, it will leave dire economic, social and political consequences in its wake. The environmental crisis is not far behind. Managers relying on the Black Swan as an excuse for lack of anticipation will and should no longer be let off the hook. Whoever sees themselves as an animal tamer in a business suit should forget Black Swans and focus instead on the Grey Rhinos.

Taming them requires the will and inner readiness to derive the necessary conclusions and make the right decisions, led not by answers but by tough questions: Is there someone you can call in to talk to in a spirit of trust to walk through decision scenarios? Is there someone in your own team who can tell you what you don’t want to hear, but definitely should? And is the team that is involved in the decision diverse enough to think about options from different directions and put them to the test? 

Answer these questions with “yes” and you are at least prepared to face the Grey Rhino. Those who still believe that leadership expresses itself most impressively through lonely despotic decisions in a public display of one’s own magnificence will soon feel the animal’s sharp horn between their ribs. And the rhinoceros will trample not only the careless leader, but also many people entrusted to their care. Companies will go under and entire sectors of the economy collapse. This is how systemic risks arise from management and decision-making crises: so no more excuses – look the future straight in the face. 

About the Author:
Miriam Meckel is founding publisher of ada, an education initiative for the future of work and socio-technological change, and Professor for Media and Communication Management at St. Gallen University

This article is one in the “shape the debate” series relating to the fully digital 12th Global Peter Drucker Forum, under the theme “Leadership Everywhere” on October 28, 29 & 30, 2020.
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