Managing the unexpected – On the work of Karl E. Weick and Kathleen M. Sutcliffe

Karl Weick has long been known for his work on organization theory.  In particular, his work focuses on how organizations make sense of complex and uncertain environments.  Among Weick’s most famous works is the study of the fire in Mann Gulch, an initially banal forest fire in 1949 that went wrong and resulted in the deaths of 13 firefighters. Weick’s analysis shows that in such conditions,  a professional team faces what he calls a ‘cosmological event’, ie an event so unexpected and powerful that it destroys the will and the ability of the victims to act, in particular to act as a group.  It is a great piece of scholarship.

“Managing the Unexpected” explores how the organization can handle the unexpected.  To do so, Weick and Sutcliffe chose to study organizations that are specifically created with that end in mind, which they call High-Reliability Organizations (HRO):  firefighters, crew of a submarine, the control center of a nuclear plant, etc. What principles do these organizations implement to operate?

Weick and Sutcliffe find that to operate successfully, HROs implement five principles:

1. An interest for failure:  HROs consider any failure, however minor, with interest.  This is because they know that minor incidents can be an indicator of more serious problems to come.  For example, in the Union Carbide chemical accident in Bhopal in 1984, the manuals for the staff were in English, a language that workers generally do not speak in India.  HROs encourage the reporting of errors and problems, however minor, and analyze in order to fuel their learning.
2. A reluctance to simplify:  Senior management is often to focused on a few key summary indicators.  Instead, HROs try to have different points of view, develop different information sources, and are wary of similarities that can be misleading.  In the Cerro Grande fire in 2000 (another initially minor fire that quickly became huge, consuming in the end nearly 20,000 hectares of forest, that needed 1,000 firefighters to extinguish, and caused $1 billion in damage), the post-incident report showed that the field team and the central command did not have the same understanding of the scale used to indicate the severity of the fire, and that this scale was too simple.  As a result, the severity of the fire was not immediately recognized by the central command and valuable time was lost with dramatic consequences.
3. A sensitivity to operations:  The highest hierarchical levels of HROs never lose contact with the operations and do not make the otherwise usual distinction between decision – the privy of top management – and implementation – left to the subordinates.
4. A commitment to longevity and resilience:  Resilience is defined as the ability of an organization to maintain or regain a state dynamically stable for continuing operations after a major shock or stress continuously.  With HROs, resilience is based on the ability to manage events in an active way to learn systematically from their action, to train their staff in continuing to speculate freely on possible problems.
5. Respect for the expertise:  In a crisis situation, HROs empower their experts to make the decisions they deem necessary regardless of any hierarchical level.  Expert here means specialists who have earned the respect of their peers, not self-proclaimed experts. Staff on the ground can make decisions without waiting for approval by the hierarchy.  Going further, one could say that the hierarchy prevails in normal times, but it disappears behind the expertise in crisis.

In summary, Weick and Sutcliffe attribute the success of HRO to their efforts to act in a mindful way.  By this they mean that the HRO are organizing to be able to notice the unexpected when it occurs and to stop its development.  If it is not possible, they contain the impact, and if that is not possible either, they are able to recover and resume normal functioning quickly.

One limitation of the book is that its applicability is limited to certain organizations.  Weick and Sutcliffe try to convince us that managing an aircraft carrier is the same as running a business, but one can be a bit skeptical.  It is rare that your business is threatened by a missile, for instance, and the commander of a carrier does not have to earn a return on capital. In addition, these organizations have different performance criteria:  for a nuclear power plant safety is paramount, as the consequences of an accident can be huge, as we have seen with Fukushima.  In a business, such consequences are usually less severe, and economic performance is the primary objective, security being one of the parameters.  One can also argue that a company faces a  much larger specter of potential unexpected situations than a team of firefighters.  Many elements are unexpected in the life of a firefighter, but the unexpected happens in a relatively limited space of possible ‘knowns’.  HROs face surprises, but not uncertainty or black swans.  In addition, many of these organizations are in a strategic environment that is relatively clear, simple and above all stable.  Hence their focus is essentially operational, including at the higher levels of the organization.  In a more ‘normal’ organization such as a company, management must also focus on strategy, and therefore necessarily can have less attention for the operation.  Rather, it is precisely the balance between the two, and especially their symbiosis, which is the difficulty of managing a ‘normal’ business.

One aspect of this topic that is not mentioned by Weick and Sutcliffe is optimization. “Optimal” for most businesses implies a degree of robustness and resilience that has gotten lost through an obsession with what is easily measured – immediate cost. We can see the dangers of this approach for HRO, but also more generally for more normal organizations. Optimization as cost cutting leaves no room for surprise; one single incident, and the consequences can be catastrophic. For instance, Apple has optimized its supply chain and controlled its costs by having one single factory, located in China. If something happens there, the firm would immediately suffer, with no back-up plan. In the light of Weick and Sutcliffe’s work on surprise, we would therefore argue for a different kind of optimization, one that would take the possibility of surprises into account, and hence take a broader view. Having a back-up in sub-optimal in the best case scenario, but it’s optimal overall, because surprises do indeed happen.

Despite these limitations, the five principles outlined in the book are very interesting and can be applied in many business situations. “Managing the Unexpected” is a useful contribution to the theme of managing the unexpected and, to a lesser extent, the uncertain.

The book at Amazon: Managing the unexpected. For more on the topic of surprises and black swans, you can read our post “Welcome to Extremistan“.