“In the unlikely event of a landing on water…”, and so the all too familiar advise from the flight attendant goes before take-off.
On the safest means of transport, an unlikely event is still treated with priority, because the impact of its occurrence is usually fatal.
The airline industry understands tail events better than any industry, and actively works at reducing the likelihood.
In finance, tail events are treated literally as unlikely, so minimal attention is paid to them. It seems smart in the short term, but sooner than later, the tail wags.
Global supply chain is currently grappling with a wagging tail, primarily caused by “smart” finance (just-in-time).
The less likely an event will happen, the greater the impact when it happens – positively or negatively.
In your planning, make space for the unlikely.
– Osasu Oviawe
