Do we really know why systems fail? How can antifragility stop these systems from failing?
Systems can fail for many reasons, but often, it’s due to a lack of variation. Having the ability to adapt and develop antifragility can prepare a system for further challenge and further stabilize it.
Keep reading to find out why systems fail and how antifragility can help.
Lack of Variation Is Why Systems Fail
To understand the difference in stability between fragile and antifragile systems, consider a hypothetical pair of twin brothers. They grew up in the same house, live in the same area, and have fairly comparable lives except for their careers. One is a middle manager at a large bank, the other is a cab driver.
The banker seems to have a perfectly stable income. He makes the same amount of money every month, which is enough to cover his expenses with a bit to spare. However, this apparent stability is an illusion; at any moment, an upheaval in the market could render him jobless, with no income at all. His banking career is fragile.
Now consider his brother, the cab driver. He has good days and bad days, so there’s some fluctuation in how much money he brings in per month, but annually his income is comparable to the banker’s. On the surface, his income seems to be less stable than his twin’s, but the key is that the cab driver is his own boss.
There’s no chance that a minor upheaval in the cab-driving market will leave him unemployed because nobody else employs him. If there’s a dip in his income, then he updates either his routes or his driving skills—in other words, he improves from the damage. This career is antifragile.
The cab driver’s career seems less secure because there’s a small element of chance to it—a bit of variability in daily or monthly income, even though his annual income tends to average around the same as his brother’s. However, that variability is exactly what makes it resilient.
A small shock to the economy might see a bank clerk unemployed, but to a cab driver, it’s just an opportunity to improve. Unless the upheaval is so extreme that people aren’t taking cabs anymore, it’s unlikely that the driver will suffer too much from it.
Large Systems Are Fragile
The key difference between the banker and the cab driver is the size of the system each belongs to. The banker is a fragile piece of a much larger system ruled from the top with a focus on eliminating risk and randomness. Those attempts to eliminate chance are another reason the system is so fragile—shielding the system from minor mistakes makes larger mistakes inevitable.
To illustrate this point, let’s move away from the bank job for a moment. Instead, imagine if a mechanic, rather than fixing a damaged vehicle, just slapped a fresh coat of paint on it and put it back on the road. It would only be a matter of time before the vehicle failed in some much more catastrophic way. That’s what the large, top-down banking system is doing: hiding and protecting itself from minor issues, but setting itself up for larger failures down the road that may cost our poor clerk his job.
On the other hand, the cab driver works within a very small system. Instead of having a single employer, he’s employed by many different people for short periods of time—just long enough to get them to their destinations. More crucially, none of them has the sort of power that the bank has over his twin; at worst, they cancel their own fare, and he moves on to another client. The variability—perhaps a better word would be flexibility—grants his income a stability that the bank clerk’s income lacks.
Another example of the antifragility of small, self-governed systems is the country of Switzerland. Switzerland has a unique system of government—or, perhaps more accurately, lack of government. The country is made up of cantons, small regional governments that work together in a loose sort of coalition. Naturally, the cantons have conflicts with each other, but they tend to be of the small, boring variety: who has the rights to precisely which bits of land, and so on.
This is significant because Switzerland is, without doubt, the most stable country in the world. It has come through all kinds of global upheavals, both economic and military, practically untouched. It’s known as the best place for the wealthy to store their riches and the safest country for political refugees to flee to.
In both cases, career and government, what works for a small system doesn’t scale to a large one. People used to live in small tribes or family units, and that’s what we’re wired for. We handle conflicts and disagreements very differently when it’s matters of nations and millions of dollars, rather than cantons and cab fares.
Those large issues tend to seem abstract, just dealing with numbers on a page rather than people, and yet the fallout from them can be much more severe. A squabble between cantons might result in a couple of angry meetings; a squabble between nations might result in economic sanctions or even war. Even so, people are more swayed by a single suffering person in front of them than by mass adversity on the other side of the planet. As the old saying goes: One death is a tragedy, a million deaths is a statistic. When power becomes centralized, as in a large bank or a large government, we inevitably end up with people making decisions based on abstract concepts, rather than having to face the people those decisions affect. Furthermore, they become weak points in the system: A corporate lobbyist, for example, can sway a single house of Congress much more easily—and to much greater effect—than a hundred small municipalities. Large systems, centralized power, and abstraction of the people and concepts in the system all create fragility.
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Here's what you'll find in our full Antifragile summary:
- How to be helped by unforeseen events rather than harmed by them
- Why you shouldn't get too comfortable or you'll miss out on the chance to become stronger
- Why you should keep as many options available to you as possible