Monday, November 17, 2014

A look at ISO through the prisms of Risk and Uncertainty

I have had the opportunity to work with the International Organization for Standardization now for 20 years.  I have seen some very significant and positive contributions, and I have seen some contributions that have proved to be invisible.  And with regret I have seen some that would have been much better if they had been invisible or better yet, never created at all.  Like anything else, every individual ISO product has a certain level of hit-or-miss.  Each product carries its own level of risk (and beyond).

The positive about ISO, is the message that “all voices are equal” as the name ISO implies.  It means that folks from large countries and small countries, rich and poor can hammer out a set of principles to which everyone can concede, if not necessarily agree (consensus) which can be developed into a standard.   That being said, it should surprise no one that, with regret, that is more myth than reality.  I sometimes wonder if Orwell was thinking about ISO when he wrote “all animals are equal, but some animals are more equal than others”.

One of the extreme annoyances that used to bother me hugely was when one or more of the “more equal” countries would drive their influence and impact on document content, knowing full well that the resultant product would never see the light of day in their own country.   This seemed to me to be a certain power imbalance and injustice.  But I have since come to realize that in the international arena, countries get what they want and work for, and that imbalance and injustice are consequences that lesser countries can accept or tolerate, or not.  It is truly up to them.  There is a reality that if there is profit to be made by sitting at the table, and exerting influence, then one is foolish to ignore the opportunity.  

On a similar theme, there is an illusion that countries that provide documents to ISO as seeds for future standards gain in stature.   It is in fact false ego.  The reality is fraught more with risk than with benefit.   A group of local thinkers can collaborate and develop a guiding principle that will work very well in their own region or country.  They know their setting, they know local practices, and they can provide guidance that is (as they say) strongly fit for purpose.  

But when that document gets put in the hands of a broader community, it can get changed, not necessarily for the better. Indeed sometimes nonsense can get introduced.  And so when the final document is generated, the originators can find themselves with a dilemma; stick with what works, or adopt the broader document, even with the nonsense incorporated.   

So it has taken me 20 years to learn a lesson.  Some ISO documents are gold (ISO9001 comes to mind) while others may be of a lesser grade.  Adopting a document may be a giant step forward, or it may prove to be more illusion and politic.  It would be great if you could predict the outcome before you join the writing team.  

It is indeed all about Risk

About 10 years ago the phrase “unknown unknowns” became part of common parlance.  Decision making will always be impacted by the influence of factors that we didn’t know that we didn’t know.  That is not a new concept; it is simply a reiteration of Frank Knight’s near hundred year (1921) concept of uncertainty  which included two classes - one measureable uncertainty, which he called Risk, and the other which was the immeasurable.  Risk is the impact of measurable uncertainty on outcome or objectives.  If only that was sufficient.  The rest is more about rolling dice with an indeterminate and random number of sides where an outcome can be a mystery or surprise, either good or bad.   

You can deal with Risk with Knightian foresight, by considering the potential rate of occurrence or degree of severity of outcome.   Nassim Nicholas Taleb refers to  inherently unpredictable outcomes from unknown uncertainty as Black Swans.   In hindsight, some of them may have been predictable, and might have been avoidable (“black swan robust society”).

Two choices: live with “doodoo happens” or develop an active strategy of observation and preventive action s than may tease out a little more measurable Risk from the sea of uncertain uncertainty.

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