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Adapt – Why Success Always Starts With Failure – Tim Hartford

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because errors are common and big projects leave little room to adapt.  P29

To produce new ideas we must overcome our tendency to fall in step with those around us, and overcome those with a vested interest in the status quo.  Making failure survivable sometimes means making small steps, but not always: many innovations emerge from highly speculative leaps, and surviving such leaps is not easy…  And distinguishing success from failure, oddly can be the hardest task of all.   P36.

Any large organisation faces a basic dilemma between centralisation and decentralisation.  Hayek, back in 1945, argued that the dilemma should be resolved by thinking about information.  Decisions taken at the centre can be more coordinated, limit wasteful duplication, and may be able to lower average costs because they can spread the fixed resources (anything from a marketing department to an aircraft carrier) across a bigger base.  But decisions taken at the fringes of an organisation are quick and the local information will probably be much better even if the big picture is not clear.   Hayek believed that most people overestimated the value of centralised knowledge, and tended to overlook ‘knowledge of the particular circumstances of time and place’.  P75

The traditional purpose of centralisation is to make sure every business unit is coordinated and nobody is duplicating anyone else’s effort.  That might work in a business like Tesco or Wal-Mart, businesses with such control over their supply chain and shop floors that experiments with new products or marketing ideas can be delegated to a computer.   But a centralised organisation doesn’t work well when confronted with a diverse, fast-moving range of markets.   The advantage of decentralisation, rapid adaption to local circumstances has grown.   P76

Sometimes, far more experimentation and far more variation are required – more than any one organisation, no matter how flexible, can provide.  In such cases a far more radical approach to promoting new ideas is called for.  It is to this problem of creating wild variation that we now turn.   P79.

Once a new idea has appeared, it needs the breathing space to mature and develop so that it is not absorbed and crushed by the conventional wisdom.

The idea of allowing several ideas to develop in parallel runs counter to our instincts: we naturally tend to ask, ‘Wat is the best option?’ and concentrate on that.  But given that life is so unpredictable. What seems initially like an inferior option may turn out to be exactly what we need.  It’s sensible in man y areas of life to leave room for exploring parallel possibilities – if you want to make friends join several clubs, not just the one that appears the most promising – but it is particularly true in the area of innovation, where a single good idea or new technology can be so valuable.   In an uncertain world, we need more than just Plan A; and that means finding safe heavens for Plans B, C, D and beyond.  P87

“The barrier to change is not too much little caring; it is too much complexity” – Bill Gates P115.

At its most basic, adapting requires variation and selection.  P117

We should not try to design a better world.   We should make better feedback loops.   P140.

Adapting requires selection, the winnowing out of bad approaches from good ones.  P140.

And the fundamental point of all these massively parallel experiments I the same: when a problem reaches a certain level of complexity, formal theory won’t get you nearly as far as an incredibility rapid, systematic process of trail and error.  P236

A single experiment that succeeds can transform our lives for the better in a way that a failed experiment will not transform them for the worse – as long as we don’t engage in denial or chase our losses.  P262

In experiments breading guppies the guppies developed a colour and patterning matching their environment after a few generations.   The guppies that did not match the look of the environment were eaten by predators those that did survived and bread more similar looking, well adapted guppies.   Individuals unlike, populations can succeed with out adapting.   The population adapted through trail and error.   But not individual guppy adapted they were either born with good camouflage or not.   So with business get in the right market at the right time and you can see your business grow and thrive.   If you are Amazon and get in at the start of the growth of the online sales boom your don’t really need to adapt.   We therefore need to be careful about adopting business strategies from companies that may have in part succeeded through circumstance.   If our businesses do not match the environmental conditions then it is important that we adapt and try something else.   We may need to adapt where someone else did not.   This is also why good businesses ideas work straight away.  They are a good fit to the environment.  And improving failing business ideas can be a torturous process – the don’t fit the environment and so struggle.   This is why it is important to realise when we are succeeding and when we are failing so we can adapt or change business quickly when we need to do so.  P223 (paraphrased content and then wrote own ideas)

First, try new things, expecting that some will fail.   Second, make failure survivable: create spaces for failure or move forward in small steps…  the trick here is to find the right scale in which to experiment: significant enough to make a difference, but not such a gamble that you are ruined if it fails.   And third, make sure that you know when you have failed, or you will never learn.   P222