I’m reading Skin in the Game by Nassim Nicholas Taleb. If you’ve ever read or watched something and it made you think “I’m not the only one who feels this way about something” – I’m getting that feeling about this book.

Nassim has an on-going feud with academic BS, apparently, and he’s articulated something that has troubled me throughout my career: the desire on the one hand for systems to explain or place a framework around complex problems (certifications, methodologies, and schools of thought like Agile, ITIL, the PMI PMBOK, etc.) vs. the inevitable feeling that most of these frameworks are valuable, but served with a steaming side dish of something that, as we say in Alabama, are perhaps mountain oysters (or worse), not seafood.

Nassim’s major premise, vastly oversimplified, is that societies and systems are extremely good at learning and assessing risk, as long as those taking the risks have “skin in the game,” i.e. stand to lose a great deal if they miscalculate on that risk. Our systems become more fragile as we insulate decision makers from risks (create bureaucrats, not entrepreneurs) This explains why we have a lot fewer incompetent pilots and engineers than we do investment bankers and consultants (and I’m a consultant).

This gives me pause and steps on my toes, admittedly, in that as a consultant I’m in a group of people that all too often are known for sizing up a problem, writing a report, and flying back home with the fee in hand. In my own defense, I’ve owned businesses (and own this one), so I know something about skin in the game. That’s why I employ an approach where the client pays as they go, and prefer to be involved with the implementation of a plan, not just writing one. I’m also interested in situations where there’s an equity or profit sharing component in the mix, because that too provides incentive to assess risks carefully with an eye toward the success of the client.

But ultimately I think (as Nassim himself alludes to when he wraps up his introduction) that you need people around you who are interested in helping make something work just because that’s their nature, and I’ve got a track record there too – a family business, community involvement, and a reputation to maintain.


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