What I Learned from Reading ‘The Black Swan: The Impact of the Highly Improbable’ by Nassim Taleb
Embracing Uncertainty: A Personal Reflection on The Black Swan
Welcome to my very first blog. I extend my gratitude to Prof. Dr. Pavan Soni for inspiring me to read a book and craft a blog around it.
Why did I choose the ‘Black Swan’ book when there were multiple options? As I read a few lines about this book, it became clear that this was the book I needed to read. But why? Well, the answer lies in the Black Swan events that have marked my life. My Mom’s diagnosis of incurable stage 3 lung cancer, with no prior medical history or symptoms, was entirely unpredictable. It came with no cure, a multitude of unknowns, and sadly, she passed away in June 2023 after a two-year battle with cancer through chemotherapy. There have been several such events in my life, including personal and spouse health challenges, and the unexpected move to a different city to work for a company — a place I had never envisioned living in.
Have you ever experienced a sudden and unexpected event that changed your life forever?
Before reading this book, I had hoped to learn how to react to such events and carry on with life. I was also eager to understand how it could enhance my Unpredictable, Unknown, Risk Management Strategy in my role as a Senior Product Manager, where I’m responsible for documenting and presenting strategies for existing and new products and features. The book, indeed, met my expectations, providing the answers I needed. It not only helped me navigate my mother’s recent passing (just three months ago) but also inspired me to apply these learnings in my personal life, including financial planning, as well as in my professional work.
Here is what I will remember for a long time, along with my key takeaways from the book:
Firstly, let’s explore the various types of ‘Swans’ as we delve into this topic. Black Swan events are sudden shocks that couldn’t have been foreseen or predicted. They are highly improbable, unprecedented, and beyond imagination. An important point to note is that when the highly expected doesn’t occur, that too is considered a Black Swan event. These events have a massive impact, such as financial crisis, technological disruptions, earthquakes, wars, terrorist attacks, 9/11 attacks and their effects on individual lives. In this book, Nassim Taleb explains why we are so bad at predicting and preparing for these events and offers insights on how we can enhance our resilience and adaptability in the face of uncertainty.
White Swan events occur with reasonable frequency and are inherently preventable. These are common, everyday occurrences that are highly predictable and have minimal impact. Examples of White Swan events include daily commutes, grocery shopping, and routine work tasks.
And Grey Swans. They are known events that fall into a surprising yet conceivable category, often neglected, and can carry significant cascading impacts, whether positive or negative. They come with a low probability of occurrence but are noteworthy. Many companies tend to overlook them. Examples include product failures, climate change, rising debt, and population growth. Additionally, in a more personal context, the birth of our second boy when we were expecting a girl child was a surprising twist, far from having a minimal impact — especially for those who understand the dynamics of raising two boys, right?”
Secondly, as mentioned in ‘The Black Swan’ book, I have a tendency to overestimate my knowledge and underestimate my ignorance. I often believe I know more than I actually do and disregard what I don’t know or can’t measure. This leads to false assumptions, incorrect predictions, and poor decisions. Nassim Taleb calls this the ‘illusion of understanding.’ He writes: ‘The problem is not that there are problems. The problem is expecting otherwise and thinking that having problems is a problem.’ I find this to be a powerful and humbling statement because it serves as a reminder that we aren’t in control of everything, and we should remain open to learning from our mistakes and surprises.
Thirdly, I would be doing a disservice to the book if I did not discuss Antifragility. Nassim Taleb has consistently emphasized it in every presentation he has given for the book review camp. So, what is Antifragility? It’s the Ultimate Risk Management Strategy. It is the idea that certain systems and individuals become stronger when subjected to stress and volatility. This concept carries profound implications for risk management. Instead of merely aiming to be resilient or robust in the face of uncertainty, our goal should be to thrive amidst chaos. This perspective has fundamentally reshaped my approach. Rather than fearing the unpredictability of Black Swan events in my life, I’m learning to leverage them, using feedback and challenges as opportunities for growth.”
Here’s a bit more about Antifragility, Risk Management Strategy, which I found extremely helpful and important.
Antifragility differs from resilience as it doesn’t just bounce back from shocks; it actually thrives amid stress and uncertainty. It actively seeks out volatility, using small stressors as opportunities to adapt and grow. Embracing disorder and learning from chaos and failures is a fundamental aspect of antifragility. It emphasizes the importance of having multiple options in life, allowing you to benefit from positive Black Swan events and reduce exposure to negative ones, such as diversifying career paths and income sources. The antifragile approach often involves decentralization and smaller, independent units, which can adapt quickly to changes and reduce the risk of catastrophic failures. Applying antifragility to daily life means diversifying knowledge, health practices, and financial investments to enhance adaptability in the face of unforeseen events.
In summary, ‘The Black Swan’ book challenges us to reconsider our assumptions, beliefs, and actions in a complex and unpredictable world. It teaches us to embrace uncertainty, question our knowledge, and be prepared for change. Additionally, it encourages us to find opportunities in chaos, to be creative and innovative, and to have fun along the way.
I hope you enjoyed reading this blog post. Please share your experiences in the comments: What are some of the Black Swan events you’ve encountered in your life? How have they impacted you? How did you cope with them? What did you learn from them?
I wish to continue writing blogs as I’ve found a better platform to share technical insights, product management-related content, as well as my personal life experiences and learnings. I also plan to write about the changes that the ‘Black Swan’ book has brought to my personal and professional life.
If you enjoyed my first blog, please clap and comment your thoughts, your Black Swan events, and consider sharing it with others.
Thank you, Pradeep Palukuri.