A ‘bat flapping its wings’ in China disrupted the global innovation ecosystem, revealing the extremely fragile architecture of business models across 5 continents and 220 nations.
The Great Asymmetry –global community’s linear response to exponential phenomena like the pandemic– may drive humans to mass extinction. The coalescence of the corona pandemic with health crises, economic recession, environmental catastrophes, biodiversity loss, humanitarian disasters, migration crises and severe geopolitical disturbances is the greatest existential threat facing humanity today.
We live in a world of hyper-connectivity, interdependencies, extreme uncertainty, complexity, chaos, disorder, volatility, variability, asymmetries and explosive risks that can trigger cascading effects in crises. In the post-COVID-19 world, nonlinearities –asymmetries, convexities– are almost everywhere. Linear models and traditional static tools developed for the pre-Covid-19 era cannot tackle exponential change and the non-linear dynamics in epidemic systems.
The blind spot of linear thinking cannot discern that the potential gains that can be brought about by positive asymmetries (convexity bias) are more than the losses that might be incurred. Time, volatility, disorder, randomness and uncertainty increase the gain –than the loss– incurred through the exploitation of positive asymmetries.
According to Nassim Taleb an idea needs to be convex (antifragile), or at least bring about a beneficial reduction of fragility. The first step is the detection and removal of any fragilities (vulnerabilities) and the elimination of the risk of ruin. Positive Black Swans (opportunities) also have a necessary first step: you need to be exposed to them.
As Taleb notes the antifragile is immune to prediction errors and protected from adverse events: ‘I will never get to know the unknown since, by definition, it is unknown. However, I can always guess how it might affect me, and I should base my decision around that […] This idea that in order to make a decision you need to focus on the consequences (which you can know) rather than the probability (which you can’t know) is the central idea of uncertainty […] As it happens, many rare events yield their structure to us: it is not easy to compute their probability, but it is easy to get a general idea about the possibility of their occurrence. We can turn these Black Swans into Grey Swans, so to speak, reducing their surprise effect.’ A Grey Swan concerns modelable extreme events, a Black Swan is about unknown unknows.
Taleb presents the barbell (or bimodal) strategy as a way to achieve antifragility: ‘An option is what makes you antifragile and allows you to benefit from the positive side of uncertainty, without a corresponding serious harm from the negative side […] Let us call trial and error tinkering when it presents small errors and large gains […] The antifragile needs to select what’s best – the best option […] Trial and error… is not really random, rather, thanks to optionality, it requires some rationality. One needs to be intelligent in recognizing the favorable outcome and knowing what to disregard […] We can, from the trial that fails to deliver, figure out progressively where to go […] Innovation is precisely something that gains from uncertainty: and some people sit around waiting for uncertainty and using it as raw material, just like our ancestral hunters’.
Taleb defines Optionality as: ‘Option = asymmetry + rationality. The rationality part lies in keeping what is good and ditching the bad, knowing to take the profits […] The difference between the antifragile and the fragile lies there. The fragile has no option. But the antifragile needs to select what’s best – the best option […] When someone has more upside than downside in a certain situation, he is antifragile and tends to gain from volatility, randomness, errors, uncertainty, stressors and time. And the reverse […] This hidden ‘convexity bias’ is what the common discourse on innovation is missing. If you ignore the convexity bias, you are missing a chunk of what makes the nonlinear world go round. And it is a fact that such an idea is missing from the discourse’.
A new Innovation Model for a nonlinear world
The notion of asymmetric outcomes is the central idea of the new Innovation Model I have developed. This dynamic model, among other poses more than 75 asymmetric innovation strategies, cross-cutting tools and creative techniques that can help Organizations harness antifragility: modify their exposure accordingly in order to exploit positive asymmetries (open to opportunities) and protect themselves against negative asymmetries (limit exposure to dangers). The detection and exploitation of positive asymmetries captures exponential multiplicative returns whilst the avoidance of negative asymmetries lessens the potential damage and eliminates the risk of ruin.
This pioneering tool can be applied in practically all domains and at all levels, scales and sizes: Public Services, Local Government, Business (startups and large corporations), Risk Management Plans, National Security Strategy (Economic Diplomacy, Nation Branding, Smart Defense), Political Campaign Management, EU Resilience and Recovery Plan, European Green Deal, Horizon Europe 2021-2027, UN Sustainable Development Goals etc.
Notions such as public sector and local government reforms, speed and growth are empty and meaningless when presented without accounting for fragility.
Embedding antifragility in Public Sector and Local Government Reform and European Programs (EU Resilience and Recovery Fund, European Green Deal and Horizon Europe 2021-2027) is an issue that should urgently be addressed by the European Commission and the European Committee of the Regions. Most transformation programs that are now underway in many European countries employ linear models and static tools. Linear models are extremely fragile and unable to tackle the polymorphic challenges and asymmetric threats of the post Covid-19 era.
The new Innovation System is presented analytically in a step-by-step practical Guide I have prepared which can prove useful in:
- Improving pandemic preparedness and management by injecting innovation and antifragility in Covid-19 Risk Reduction Strategies and Rapid Response Programs.
- Strengthening competitiveness and employment and accelerate recovery from the coronavirus induced-recession.
- Guiding Organizations to innovate under conditions of extreme uncertainty.
- Maximizing the scientific, economic and social impact of innovation.
Covid pandemic is the greatest challenge facing humanity: Cultural evolution and symbolic thought against Omicron biological evolution and infinite combinatorial power. The strategy for harnessing the ‘tidal wave’ of Omicron entails the systematic use of a combination of asymmetric innovation strategies, cross-cutting tools and creativity techniques found in the Innovation Toolkit which I have created. As mentioned earlier, the Toolkit includes more than 75 different strategies, tools and techniques which can be accordingly applied, to cover every facet of the pandemic crisis.
The roots of nonlinear thinking that led to the invention of the new, dynamic Innovation Model described very briefly above can be traced in the fertile land, the rich cultural and natural heritage, the huge diversity and the changing scenery of the rare beauty of Akanthou and Lefkoniko area in Cyprus. In this unique creativity hotspot, a substantial number of innovations were produced in every domain: agriculture, production methods, technological innovations, arts and sciences, education, handicrafts, music, theatre, poetry, health, athletics, social innovations, social entrepreneurship, cooperatives etc. The period 1900-1974 in the long history of the municipalities of Akanthou and Lefkoniko –the places I spent the first 18 years of my life– can justly be characterized as ‘The Golden Age of Innovation’. Even the way this land was created was unique (collision, rifting). The Pentadactylos Mountain Range (where Akanthou is situated) and Mesaoria plain (where Lefkoniko is located) arose from the depths of the ancient Tethys Ocean that reshaped the world.
