As Milo and I have argued before, the environments and issues businesses deal with are more complex than traditional strategy models admit. Business issues today display high levels of uncertainty, they can behave non-linearly, and they can be vulnerable to “Black swans”, i.e. low-probability but high impact events that disrupt even the best formulated strategies. The added difficulty for strategists and managers is that nonlinear environments often appear linear for an extended time period (think US house prices). As a result, some conclude that what seems to be an essentially linear pattern (prices fluctuate a bit around a ‘long term trend’ but always rise), are linear in reality – before a radical change occurs that completely disrupts previously assumed patterns (e.g. prices fall dramatically). In short, people often assume an environment is linear and predictable when in fact the continuity we observe is only a particular case of limited duration. To make matters worse, with many nonlinear systems change is not nicely spread over the years: most of the cumulative change occurs in one, single – often dramatic – occurrence. In the language of engineering, some things don’t “fail gracefully” (e.g. a bridge that breaks suddenly instead of bending slowly).
Not a “graceful failure”.
Silberzahn & Jones 