Why some people know what cannot be known
As a reader of business and financial news I’m struck by the apparent ability of traders and chief economists to predict the future – or rather the stunning belief in their ability to do so.
It ranges from predictions of share prices at the end of the year to oil price fluctuations and even the risk of terrorist attacks or similar blows to the stability of the world and the markets.
All the predictions cannot be right. Partly because they contradict each other, but mainly because they predict something that cannot be predicted.
Just like nobody will know the weather one month from now, no-one can know the exact movements of the financial markets. Like the weather, the financial markets are a chaos system.
As humans dealing with a complex world we organize our thoughts in stories. The more coherent the narrative, the more we believe in it – and the more convincingly we can pass it on. The experts have simply put together a convincing story in their own minds, giving them the ability to present it with conviction.
The weather and the financial markets are chaos systems. Impossible to direct, but most human endeavors are much less complicated. Even large companies, while complex, are not real chaos systems. They can be directed by top management with decisions and coherent narratives.
They try heroically, but much too often the narrative hinges on stale values, vision statements and boring value propositions.
Life - and this includes corporate life - is an ongoing narrative. It must be renewed every day in an ongoing dialogue between the company and its market.
Most companies which are today struggling to fill an employee magazine four times a year would be able to take on such a dialogue. Look for the stories outside headquarters, in the interaction between the company, its employees, customers and stakeholders.
Most large companies would be able to fill the evening news every day.
Steen Reeslev is the managing partner of This Is Touch – a company providing television airtime for corporations in the growth markets of Latin-America, Asia, and Africa. Previously he was senior vice president responsible for Group Relations at A.P. Moller-Maersk. This Is Touch is based on experience from A.P. Moller-Maersk. The company produced a large number of films on all aspects of the business. The high quality of the films gave access to airtime on television in more than 30 markets.