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The Risk of Being Fragile (2012 Fall Commencement Saturday Morning)

  • Date: 12/15/2012
  • Author: Dr. Luis M. Proenza (President, The University of Akron)
  • Location: E.J. Thomas Performing Arts Hall
  • The degree you are about to receive often is referred to as a credential, a word derived from the Latin credentia, meaning simply, “belief.” A credential assures prospective employers or graduate schools that they have reason to believe that you possess the knowledge and understanding implied in your degree.

    What a credential does not tell them is your level of competence or ambition. For that, they must look at something else, a little reference tool that we call grades. While not infallible, grades give a good approximation of your abilities, work ethic and ambition.

    There is one other tool that would be of great value to employers in every sector, but alas, no one has yet invented it. This would be a tool that accurately measures tolerance for risk or your emotional resiliency. For few things in life will determine the extent of your success more than the degree and types of risk you are ready to assume, or your ability to mentally rebound from setbacks. As T.S. Elliott said, “Only those who will risk going too far can possibly find out how far it is possible to go.”[i]

    Risk, however, raises the possibility of failure or loss, and that provokes anxiety. The problem is that we sometimes fail to appreciate that risk and anxiety are two quite different conditions.

    A simple story will illustrate my point.

    The Surgeon General tells us that cigarettes kill more than 440-thousand Americans each year,[ii] and automobiles kill more than 30-thousand people per year.[iii] But, no one seems to be afraid of cigarettes or automobiles.

    However, according to the Deputy Director of the National Institutes of Health, everyone is afraid of sharks.

    It is estimated that there are about 70 shark attacks worldwide each year.[iv] The National Center for Health Statistics doesn't even keep a record of shark attacks because there are so few. (They know how many people are killed by bee stings, but not by shark bites.)[v] The best guess is that sharks kill only two or three people each year in the United States.

    But, the fact is that if you went to a crowded beach and shouted "shark" - everyone would race out of the water, jump into a car, light up a cigarette, and drive home!

    Risk-taking is a necessary element for a balanced, healthy life. It introduces the possibility of loss or failure, but it also injects the potential for new opportunities and beneficial results. Even failures can be advantageous…more about that in moment.

    But be assured: a world – or career – utterly devoid of risks ultimately is the most hazardous of all, because that would make us fragile.

    The idea is well developed in a new book titled, “Antifragile: Things That Gain from Disorder,” by Nassim Nicholas Taleb.[vi]  He says volatility, variability, stress and disorder are actually beneficial, and cites our own bodies as an example of what he means.[vii]

    Heavy loads and repetitive motions stress our muscles, but that makes them stronger.

    Bacteria and viruses stress our immune systems, but over time that makes them more robust.

    And life’s challenges, disappointments and reversals certainly stress our character, but that can enhance our emotional resiliency, and enable us to better distinguish risk from anxiety.[viii]

    Taleb uses the restaurant industry as another example of antifragility at work.[ix] Imagine if the government bailed out every restaurant in your region that was failing. There would be no incentive to improve. Eventually the quality of the local cuisine would decline to a level on par with a cafeteria. But when failure is a stark possibility, as it is in any free market, restaurateurs do what they must to survive: they innovate, they experiment…they take risks. And the industry, not to mention society, benefits.

    This same principle applies in your career. You must risk disappointments and some failures in order to find and capitalize on new opportunities.

    Taleb also encourages readers to “embrace ‘optionality’ – like a traveler without an itinerary feeding off randomness by grabbing opportunities as they arise.”[x]

    I can tell you from personal experience that you can make this strategy work. My career has been somewhat like a trip through a pin-ball machine – I’m going to have to find another metaphor because more and more often I have to explain what a pin-ball machine is – suffice it to say that it means bouncing from one opportunity into another.

    Recent research at the University of Virginia suggests that learning to accommodate feelings of uncertainty is not just the key to a more balanced life, but often leads to prosperity as well.[xi]

    The researchers interviewed 45 successful entrepreneurs, all of whom had taken public at least one business. Almost none of these individuals embraced the idea of writing comprehensive business plans or conducting extensive market research. They did not choose a goal and made a plan to achieve it. Instead, they evaluated their resources and circumstances, and imagined realistic outcomes.[xii]

    Significantly, they did not focus on the possibility of spectacular rewards from a venture, but determined how great their loss would be if they failed. If the potential loss seemed tolerable, they took the next step.[xiii]

    These entrepreneurs possessed the ability to accurately assess potential loss, and thereby thrive in the face of volatility and disorder. Taleb says “There is a crucial requirement to achieve antifragility: The potential cost of errors needs to remain small; the potential gain should be large. It is the asymmetry between upside and downside that allows antifragile tinkering to benefit from disorder and uncertainty.”[xiv]

     

    First, of course, one must have the courage to calmly stare into the dread face of failure. The ancient Roman philosopher, Seneca the Stoic, had this advice for those who avoided risk because they feared losing their wealth. Seneca said “set aside a certain number of days, during which you shall be content with the scantiest and cheapest fare, with coarse and rough dress, saying to yourself the while: 'Is this the condition that I feared?"[xv]

    Failure often looms larger in our imaginations than it does in real life.

    So as you begin your professional careers, or advance them to the next level, be of good cheer and have confidence.  Do not shrink away from the winds of change and turbulence, but rather, lean into them.  And, of course, be prepared to bounce back whenever you are faced with setbacks or even failure.

    For the same wind that extinguishes the candle, also energizes the fire![xvi]



    [i] Ditkoff, Mitch. (Nov. 8, 2012)“50 Awesome Quotes on Risk Taking.” Huffington Post http://www.huffingtonpost.com/mitch-ditkoff/50-awesome-quotes-on-risk_b_2078573.

    [ii] U.S. Department of Health and Human Services: How Tobacco Smoke Causes Disease. A Report of the Surgeon General.  http://www.surgeongeneral.gov/library/tobaccosmoke/report/full_report.pdf

    [iii] National Highway Traffic Safety Administration. http://www-fars.nhtsa.dot.gov/Main/index.aspx 

    [iv] Florida Museum of Natural History, University of Florida. International Shark Attack File 2007 Worldwide Shark Attack Summary.

    [v] Centers for Disease Control and Prevention, National Center for Health Statistics/NIOSH Workplace Safety and Health Topics: Insects and Scorpions http://www.cdc.gov/niosh/topics/insects/

    [vi] Taleb, Nassim Nicholas. (Nov. 16, 2012) “Learning to Love Volatility.” The Wall Street Journal http://online.wsj.com/article/SB10001424127887324735104578120953311383448.html?KEYWORDS=learning+to+love+volatility

    [vii] Ibid

    [viii] Ridley, Matthew. (Nov. 26, 2012) “Economic Bricolage.” The Wall Street Journal. http://online.wsj.com/article/SB10001424127887323353204578128872051100906.html?KEYWORDS=economic+bricolage

    [ix] Taleb, Ibid

    [x] Ridley, Ibid

    [xi] Burkeman, Oliver. (Dec. 7, 2012) “The Power of Negative Thinking.” The Wall Street Journal. http://online.wsj.com/article/SB10001424127887324705104578147333270637790.html?KEYWORDS=The+Power+of+Negative+Thinking

    [xii] Ibid

    [xiii] Ibid

    [xiv] Taleb, Ibid

    [xv] Ibid

    [xvi] Taleb Nassim Nicolas. Antifragile: Things That Gain from Disorder. 2012. Random House, New York, NY. p.3

  • Topic Category: Risk aversion and emotional resiliency
  • Tags: risk emotional resiliency Nassim Nicholas Taleb antifragile
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