Friday, January 18, 2013

The Theory of the BLACK SWAN

What does the “Black Swan” have anything to do with Aviation, Control or SMS? It actually has everything to do with all three. “Fooled by Randomness” by Nassim Nicholas Taleb says that the London expression derives from the old world presumption that all swans must be white because all historical records of swans reported that they had white feathers. In that context, a black swan was impossible or at least nonexistent. Until Dutch explorer Willem de Blaming discovered one in western Australia in 1697. 

The term “Black Swan” was then used to describe the following:

  1. The disproportionate role of high-profile, hard-to-predict, and rare events that are beyond the realm of normal expectations in history, science, finance, and technology
  2. The non-computability of the probability of the consequential rare events using scientific methods (owing to the very nature of small probabilities)
  3. The psychological biases that make people individually and collectively blind to uncertainty and unaware of the massive role of the rare event in historical affairs

As we teach in our statistical process control courses, randomness always forms a pattern. We can not predict an “Out of Control” event. The recent tragic Sandy hook school shooting is considered a black swan event. 9/11 is considered a black swan event also. But, like in the vast majority of accidents or events, there is always a trail of “out-of-control” or abnormal behavior or incidents that are evident in the trail leading up to the event. Keep in mind that a black swan event seems impossible to the viewer of the event. However, to another viewer the event can be possible or even probable. 

Example: A cow enjoying the grass in a meadow would consider being slaughtered and eaten as a black swan event. But, to the butcher it is inevitable. A catastrophic airline crash caused by a battery explosion would be considered a black swan event. But, I am willing to bet that the battery company has evidence of an explosion possibility. The battery company should consider all possibilities. At least do a risk analysis on that possibility. 

We must look at all our processes, no matter if we feel that there is no way this will cause an accident or tragedy. Using the inputs to all processes, i.e. materials, methods, people, machines and environment, to analyze and at least risk rate these processes. 

So the comment, we never had a problem with batteries before does not absolve the process owner form looking at the possibility of problems occurring. I am betting that variation will be present before the accident or event takes place.  Your thoughts....

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