Dispersed knowledge is essentially dispersed and cannot possibly be gathered together and conveyed to an authority charged with the task of deliberately creating order. - F.A. Hayek
While Hayek’s contributions to 20th century thought should never be limited to merely one quote, it is perhaps this basic notion of “the knowledge problem” that defines Hayekian thought at its finest. Building off of the Misesian notion of human action, Hayek here says, essentially, that no central authority could ever gather the knowledge that is dispersed throughout society in individuals adequately enough to maintain order, let alone optimize prosperity. This basic reality of knowledge undermines the entire thesis of statism and should never be forgotten for any who desire a free and prosperous society. David Bahnsen, There’s No Free Lunch
Friedrich Hayek was a genius. The Nobel Prize-winning economist wrote many classic texts – The Road To Serfdom alone played a huge role in making the case for freedom and the reasons why the Cold War was essential, and essential to win. And his ideas continue to influence policy and economics.
But to my mind, his greatest insight was into what he called “the Knowledge Problem”. Combine this with the concept of spontaneous order, and you gain a tremendous tool for understanding why planning can work on a small scale, but always fails on the larger stage. How things that work in your family (the microcosm) fail catastrophically when attempted to scale up to the societal (or even the organisational) level (the macrocosm).
Many of my roles have specifically involved maintenance and project planning, often at the cusp of the point where they really start breaking down. That’s often in the context of a plant shutdown.
That breakdown point always leads to an interesting challenge, which is more about leadership and less about planning. Because the answer to planning failures is better planning & bigger, more detailed plans, and more planners – right? Because there must be one perfect, right way of doing this process, and we just have to find it – right? Because if you can just eliminate more uncertainties, and have more contingencies, and manage the interfaces better, it’ll all go by the numbers – right?
Leading maintainers - or what you might call engineer-caste people generally – their answer to those questions is typically “Right!” When the actual answer is at best a highly hedged “Maybe?” And you have to manage that expectation, keep them striving to improve while moderating their excesses. To understand the absolutely well-intentioned place they come from (because that's me, too).
I once had a fairly senior shutdown planner say to me, totally seriously, “I can’t understand this company, Tony. It’s plain that the problem with shutdown over-runs is not enough people to do the work. So, we should build a new 500-person camp, in the central Pilbara, and just have tradespeople on roster, coming and living in the camp, and when we need them, we’ll just grab them and use them where-ever we have a shortfall”. That would work….
And he wasn’t alone – I’ve had some Board-level leaders in this business expound similar theories to me. It becomes management upwards, as well as down.
I’ve used Eisenhower’s quote before – planning is essential, plans are useless. Rumsfeld was right – unknown unknowns are real, and a fact of every-day life.
Or that other, even pithier, quote – “Everyone has a plan, until they get punched in the face” – Mike Tyson.
But I’ve also had successes – we ran a very constrained, tight shutdown on an important piece of gear, but kept it down to a few distinct tasks that had few if any linkages to each other. It went like a dream, and we had a very fruitful review with my experienced planners afterwards, who all had come up with roughly the same lessons about what made it work. They also conceded we couldn’t always do it this way, but will always keep the basic lessons in mind – which is, in effect, keep it simple, whenever you can.
I’ve found leadership is sometimes about understanding the limits of what you can do – not giving up on improvement or trying different solutions, but giving up on the notions that getting bigger and more complex will always be better, and that you can control any more than a very few inputs. Or that you can know things that you just don’t, and can’t. And the rest is maintaining the flexibility to adapt to circumstances and maximising your degrees of freedom. Knowing when the best starts being the enemy of the “good-enough”, when you’re at the Pareto 80%.
Giving up on perfectibility, and the master plan.
Because Utopia is "no place".