Unknown Unknowns

There are known knowns. These are things we know that we know. There are known unknowns. That is to say, there are things that we know we don’t know. But there are also unknown unknowns. There are things we don’t know we don’t know.”   –Donald Rumsfeld

Say what you will about Rumsfeld or the Iraq war, but this is actually a great and extensible quote.  And more to the point, I’d say that one of the main informal jobs of a CEO, sort of like Connecting the Dots in that it’s not one of the three main roles of a CEO) is to understand and navigate known unknowns and unknown unknowns for your organization (hopefully you already understand and navigate the known knowns!).  Here’s what I mean:

• An example of a known unknown is that a new competitor could pop up and disrupt your business from below (e.g., the low end) at any minute.  Or let’s say your biggest partner buys one of your competitors.  These are the kinds of things you and your team should be cognizant of as possibilities and always thinking about how to defeat
• While I suppose unknown unknowns are by definition hard to pin down, an example of an unknown unknown is something like a foreign leader deciding to nationalize the industry you’re in including your local subsidiary, or a young and healthy leader in your organization dying unexpectedly, or September 11.  I suppose these are “black swan” events that Nassim Nicholas Taleb made famous in his book.

Helping your team identify potential known unknowns and think three steps ahead is critical.  But helping your team turn unknown unknowns into known unknowns is, while much harder, probably one of the best things you can do as CEO of your organization.  And there are probably two ways you can do this, noting that by definition, you’ll never be able to know all the unknowns.  As you might expect, the way to do that comes down to increasing your pool of close-at-hand knowledge.

First, you and your executive team can have as broad a view of your industry and corporate ecosystem, and of the economy at large, as possible.  It’s critical for business leaders to read diverse publications, to share insights with teammates, and to network with experts both inside and outside your space.

Second, you can design a culture so that information flows freely up, down, and sideways — so that people in your organization want to share information instead of hoard it.  That’s easier said than done, and there’s more than a blog post worth of what has to go into making that a reality.  But think about the CIA and all the flak they got about failure to connect the dots around September 11.  To close this post where I opened it, you can be the chief connector inside your organization…but you need to get your organization connecting the dots itself.