TEDxWarwick - John Kay - Obliquity: How Complex Goals Are Best Achieved Indirectly

[Music] even if you don't know very much about geography I'm pretty sure you know that the Pacific Ocean Li Li to the west of the Atlantic ocean except what's the best way to get from the Atlantic Ocean to the Pacific Ocean you would think it's obvious wouldn't be you go west actually you don't the best route from the Atlantic to the Pacific is to follow the route of the Panama Canal and you can see the route on the map and you will see that if you do it you end up in the Pacific Ocean 30

m to the east of where you started off in the Atlantic suppose you want to fire a rocket uh and uh to Mercury Mercury at the shortest distance is about 50 million miles away from Earth that sounds a lot but actually it's not that far as Rockets go so you'd fire a rocket directly towards Mercury well no you wouldn't NASA the American space agency set a a vehicle in Motion in 2004 to get to Mercury a from Earth you can see on that slide what it did it circled the earth once it circled Venus twice

it circled mercury three times before NASA managed to nudge it into orbit Mercury and there's a reason for that if you actually fire a rocket straight towards Mercury it either hits Mercury or it passes it by and goes off somewhere into Infinite Space and in either case it's not much use to you that's why it took s years and actually although the shortest distance from Earth to Mercury is only 50 million miles that shuttle actually traveled five billion miles 100 times as far in going from Earth to Mercury how you get how you C use

the Panama Canal how you get Mercury from Earth these are examples of obliquity they're problems for which the best solution turns out to be an indirect way of achieving it but I'm not a geographer and I'm not a space scientist either I didn't come come to thinking about obliquity uh by thinking about these issues I came to it by thinking about economics and business and that goes right back to the 1990s where I was noticing the change that had actually occurred in business and that change was exemplified for me in these two extracts from the

mission statement the statement of objectives of what was then Britain's largest Chemical Company ICI ICI had been Britain's leading Industrial company for most of the 20th century and what it said about itself was it aims to be the world's leading Chemical Company serving customers internationally through the responsible application of chemistry and related science through achievement of that aim it says we will achieve these other goals making money for shareholders satisfying our employ employees Etc like a lot of businesses in the 1990s they changed it it became our objective is to maximize value for our shareholders

by focusing on businesses where we've Market leadership a technological edge and a world competitive cost base well actually we know what the outcome of that was the company that uh went to maximize volue for its shareholders ERS it did it for a rather short period the share price reached a peak in 1997 and ICI is not only not the world's leading Chemical Company anymore it doesn't actually exist anymore what was left of it was taken over in 2007 by a Dutch company actually the direct was less effective than the oblique even in achieving the direct

aims and that's been true relatively generally Bear Sterns the American Investment Bank which went bust in 2008 had a sign over its trading floor that said we make nothing but money and the end result for the business that made nothing but money was that in the long run they didn't make very much even of that that's what brought me to the idea of obliquity that our complex goals are often best achieved indirectly and the phrase obliquity actually came to me when I talked to the chemist who was more than anyone responsible for the modern success

of ICI in fact he was behind the development of three of Britain's large pharmaceutical companies that have made this a world leading British industry he was called Sir James black and he discovered a variety of Blockbuster drugs and in the process of doing that probably made more money for shareholders than anyone else in the history of British business I asked him why he had left ICI to join another Chemical Company and another pharmaceutical company for whom he also discovered a blockbuster drug and he said to me it was easy the management of want of ICI

wanted me to go on a road road shows to sell beta blockers I wanted to find more drugs and he laughed said I used to tell my colleagues that if they wanted to make a lot of money there were easier ways of doing it drug research and he shook his head and said how wrong could I have been I think of it now he said as the principle of obliquity complex goals are often best achieved when you're not trying to achieve them and that was true in his career and it's true in business more widely

now this isn't an idea that applies only to business nor is it a new idea one of the best statements of obliquity I've found comes from the 19th century philosopher John Stewart Mill who wrote a great deal about utilitarianism he was one of the great utilitarians emphasizing that the pursuit of happiness was the fundamental um human objective despite that he wasn't actually a very happy man and towards the end of his life in his autobiography he wrote uh I now thought that this end was only to be attained by not making it the direct end

those only are happy who have their minds fixed on sub object other than their own happiness and I think we all of us know that that's true so it's not just true in business it's not just true in space and it's not just true in geography the direct approach has really been represented was represented in the 20th century by what was called modernism in a whole variety of areas of human activity and one of the great examples of modernism was architecture the French architect Lauer wrote a house is a machine for living in and in

order to make houses that were machines for living in he built in the outskirts of Marseilles the first tower blocks they were called the UN as and they were copied as you know all over the world but houses aren't machines for living in houses involve complex social interactions to work effectively and the people who built buildings like that didn't actually understand these interactions if you want to look for great buildings in France you don't go to Marseilles to see that you go to Paris to see this to see see something like the Cathedral of nraam

it took two centuries to build and when they started off building it nobody knew what it was going to look like when they finished up we don't actually know who the Architects and Builders who put it together actually were and yet they built something that has endured for seven centuries and will no doubt endure the sth centuri is more that's obliquity but why isn't it obvious that uh the way we should think about achieving things is to Define our goals and go for them you'll find a hundred self-help books that will tell you that the

first problem is that defining what our objectives are is actually quite complicated the United Nations created something called the human development index which is their attempt to Define what it is countries should be aiming at and you can see on the top of this Slide the formula for the human development index it's pretty easy all you need to do is write down is to find L which is life expectancy at Birth you need the adult literacy rate R you need the proportion of the population in secondary education you need GDP per head at purchasing power

parity and you shove them into that equation and you get the human development index well but why and why couldn't you have some other formula and if you put the numbers into that formula you discover that Canada and Norway tend to come top of course Canada and Norway come top if Canada and Norway didn't come top you wouldn't think gosh I must have made a mistake and what I think about Canada and Norway is wrong what you would think would be the must be something wrong with the index or something wrong with the data that

I've put into it we're telling the formula what the answer is not the formula telling us what the answer is our objectives are complicated and we learn through the process of working them through what they actually are that's the first reason why we need obliquity the second reason is that the world is uh inevitably uncertain I find it's not very popular to quote Donald rumfelt much in these sort of occasions and this is one of the many quotations in his days at defense secretary for for which he is much mocked but it's actually a very

helpful quotation because what rumfelt does in that is to distinguish the known unknowns by which he means the things you know you don't know from the unknowns the things you don't know you don't know uh the known unknowns are things like whether a coin will fall heads or tails we know it will be either heads or tails our unknown is just whether it will be heads or tails but you can't as it were predict the invention of the wheel because if you could predict the invention of the wheel you have already invented the wheel there

is a whole lot about the future world which we actually don't know and can't know so the world isn't just risky the world is uncertain there are a whole variety of things not only that we don't know but we don't even know what they might be next reason why we need obliquity is that the world is complicated and the simplifications we we make to try and deal with it are very often misle leading my first job I had was working in Oxford and when I worked in Oxford some friends who lived in London invited me

to dinner at their house in hide Park Gardens and as you do I asked them what's the nearest Underground Station to your house in Hy Park Gardens and they told me Lancaster gate so I took the train to Paddington and got out at Paddington looked at the tube map and I discovered it's easy to get from Paddington to in castig Gate you just go two stations on the circle line change at Notting Hill gate and two stations on the central line to Lancaster gate there probably aren't many people in this audience who know London well

because I have a sense that a lot of you don't know what the denong to this story is going to be because if you look at a map of London that is an overground map you will see where what I did which was I went a mile and a half East uh a mile and a half West on the circle line from Paddington H to to to Notting Hill change trains and retrace the mile and a half back West on the central line it's actually less than 500 yards to walk from Paddington to lancast gate

now you might think so that means the tube Maps a terrible model but it's not a terrible model it's actually a brilliant model it was designed in the 1930s by a circuit wiring engineer called Harry Beck it was immediately adopted because people found it so easy to use it's been imitated all around the world uh and it's helped tens of millions of people find their way to their destination it's just a bad map for that particular problem but how do we know that it's a bad map for that particular problem the only way we know

it's a bad model for that particular problem is if you have the more generalized knowledge of London that I now have but I didn't have there that is there isn't a right Model A true model that we can use to analyze complicated situations there's only the right model for any particular problem and there's no objective way of determining what the right model for any particular problem is but we have this idea that this isn't how we should be making decisions Benjamin Franklin the great poly American polymar wrote a letter to the English chemist Joseph Priestly

in which he set out how you ought to make decisions take he said half a half a sheet of paper divide it by a line into two columns and write the pros on one and the cons on the other and see what the lists look like and Charles Darwin actually followed Franklin's advice Darwin was trying to decide whether he ought to get married or not so he took a sheet of paper and he divided it into two columns one headed marry and the other headed not Mary so this was a Pros column for Mary a

friend who will feel interested one an object to be beloved and played with better than a dog anyhow he said the charms of music and female chitchat that was the advantage of being married not married seem to have a rather longer list of uh of benefits problems of uh of being married for example not being forced to visit relatives to bend in every trifle to have the expense and anxiety of children forced to gain one's bread bad for one's health my wife won't like like London but as Franklin told him he thought about it for

a few days and then you can still find this paper in the Darwin archives he wrote at the bottom of the marry column my God it is intolerable to think of spending one's whole life like a NE to bee working working doing nothing after all no no won't do living all ones day solitary only picture yourself a nice soft wife on a sofa with a good fire which led to the conclusion scribbled across the bottom of the paper marry marry marry QED he thought he ought to follow Franklin's rule but in the end he didn't

as a matter of fact this assessment seems to have been made without any particular woman in mind but the following year he did in fact Marry Emma Wedgewood and the couple seem to be happy be happy enough at any rate to have 10 children actually what Darwin was playing and Franklin I think had his tongue in his cheek when he wrote that in the first place Franklin also wrote what I call Franklin gambet he said so convenient a thing it is is it to be a reasonable creature since it enables one to find or make

a reason for everything one has a mind to do and that is what Darwin did and that is what we are doing all the time when we make Personnel assessments or risk evaluations or whatever it is we may be doing we're finding ways of rationalizing decisions which we've already made on other grounds and actually in in Iraq in risk assessment in banks that is a very large part of what went wrong people were actually playing Franklin's Gambit so we need to make decisions obliquely above all we need to be foxes rather than hedgehogs that's a

distinction that's been around in personality types for a couple of thousand years in the 20th century it was popularized by Isaiah Belin the Hedgehog knows one big thing the fox is eclectic and pragmatic and knows a great many little things we don't have single overarching directed goals that we can push our thinking towards we actually learn about our goals through the process of uh trying to accomplish them we live in a world that is characterized by extreme uncertainty we try and deal with the complexity of the World by building models and structures to deal with

them but there isn't any right model that gives us the right way of making decisions about the complex problems we face if we're to make decisions successfully in complex environments obliquity has to be a major element in the process by which we do it thank you [Applause] all