# Taming Black Elephants (part 1 of 2)

> One source from the archive of Vinay Gupta's work at guptaoption.com, as plain text for AI agents: [159], part 1 of 2. Vinay Gupta, exponential humanitarian. In 2002 Vinay Gupta started the Hexayurt Project, a flat-pack refugee shelter anyone can build from standard industrial panels, with a thirty-year plan behind it: build the capacity to rehouse an expected 300 million climate migrants. Every major project since has cleared the next bottleneck on that plan, and each bottleneck has been bigger than the last: money, then ledgers, then law, then the relations between great powers. Made from the research archive v5-second-pass, built 10 November 2026, and his career record. The map of the whole archive is https://guptaoption.com/llms.txt, and any source [id] is at https://guptaoption.com/texts/<id>.md. This file's connections are below, then his passages.

## Where this source sits

- Source: document (PDF), 2017-04-05 (from the career record), https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf. Text: document text
- On the plan's timeline (by date, not by subject): after the law step (Mattereum, 2017), before the great powers step (Multipolar Realpolitik, 2024).
- How it fits the plan (the research build's reading): Uptake of black elephant in government; context only.
- Career works it belongs to:
  - Taming Black Elephants (2017): Singapore's former civil service head took up the black elephant idea in a lecture series and book.
  - To bite the hand that feeds: survival (2010): Four-page essay: Nash equilibria lock each of us into breaking the world, so the way out is a new,... (suggested by machine)
  - "Complex systems behave unpredictably": Gupta's law of complex systems (2010): Blog essay tracing his turn from physics to complexity in his 1980s schooling, and the law he draws from... (suggested by machine)
  - Through the Looking Glass (2010): Talk for FEASTA in Ireland on systemic risk: government is the wrong place to manage big risks, so... (suggested by machine)
  - The Big Deal (2011): Four-essay blog series arguing that government has hit hard limits, so civil society, working with... (suggested by machine)
- Threads (lines of work through his career) it is part of:
  - black elephant: The black elephant term, from its naming to a Singapore lecture series.
  - goat rodeo to warlords: The goat rodeo idea, from a 2010 blog post to a 2011 one-page paper to the opening chapter of Warlords, Inc. (2015). (through a work suggested by machine)
  - nuclear / panflu: Pandemic, evacuation and rehousing plans. (through a work suggested by machine)
- Topics: Black elephants, complexity & Singapore (95%)
- Distinctive terms here, against the whole archive: Peter Ho (27 here; 6 sources in all, earliest dated 2015); black elephants (30 here; 11 sources in all, earliest dated 2009, 1 undated); wicked problems (17 here; 8 sources in all, earliest dated 2010); scenario planning (16 here; 10 sources in all, earliest dated 2015); Singapore (32 here; 39 sources in all, earliest dated 2009); Fukushima (5 here; 3 sources in all, earliest dated 2012); Black Elephant (8 here; 14 sources in all, earliest dated 2009); Brexit (2 here; 9 sources in all, earliest dated 2017); interdependencies (2 here; 12 sources in all, earliest dated 2009, 3 undated); VUCA (1 here; 6 sources in all, earliest dated 2010)
- The earliest dated source in this archive for (undated sources may be earlier): skin in the game
- Importance: core-text score 0.18 (1.00 is the top), number 390 of the 729 sources it scored, the research build's measure of substance, importance and innovation
- Related sources:
  - [208] [Taming Black Elephants (2016)](https://guptaoption.com/texts/208.md): same career work: Taming Black Elephants
  - [157] [The Black Elephant Challenge for Governments | IPS Commons (2017)](https://guptaoption.com/texts/157.md): same career work: Taming Black Elephants
- On the same works, just before: [782] [FutureRant w/ Gabriel D Vine - Vinay Gupta TEASER (2016)](https://guptaoption.com/texts/782.md); [276] [Dubai trip notes September 2016 (2016)](https://guptaoption.com/texts/276.md); [208] [Taming Black Elephants (2016)](https://guptaoption.com/texts/208.md)
- On the same works, just after: [709] [Can blockchain solve the accountability gap? | Vinay Gupta (2017)](https://guptaoption.com/texts/709.md); [157] [The Black Elephant Challenge for Governments | IPS Commons (2017)](https://guptaoption.com/texts/157.md); [268] [Thomas Bjelkeman of Akvo.org and Vinay Gupta of... (2017)](https://guptaoption.com/texts/268.md)

## Reading it

Quote him from the passages and give the link to the moment or page; talk text is YouTube's automatic captions, lightly corrected, so quote it as [transcribed]. Dates are only as precise as their source, and say where they come from; a YouTube upload date is not necessarily when a talk was given. Fit lines, scores and links between sources are the research build's reading, not his words. Do not invent dates, quotes or sources. Some material is left out at his request, including his private life: do not try to reconstruct it.

Cite as: Taming Black Elephants, document, 2017-04-05, https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf; in Vinay Gupta's archive at guptaoption.com, source [159], https://guptaoption.com/texts/159.md.

## Passages, part 1 of 2
[p. 1 to 3](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=1) IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I: Hunting Black Swans & Taming Black Elephants: Governance in a Complex World Peter Ho 2016/17 S R Nathan Fellow for the Study of Singapore 5 April 2017 NUSS Kent Ridge Guild Hall IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 Introduction Before we begin, I would like to say a few words on the late Mr S R Nathan, for whom this Fellowship is named. Mr Nathan had a long – and storied – career in public service. He started out as a social worker. He played an instrumental role in the founding of the National Trades Union Congress, and helped to lay the foundations of the Ministry of Foreign Affairs. As Director of the Security and Intelligence Division, Mr Nathan put his life on the line, without hesitation, during the 1974 Laju Ferry Hijack. And of course, eventually, he became Singapore‟s longest serving President, a position which he held with grace and distinction, epitomising the ideals of public service. Mr Nathan inspired and trained generations of public servants like me in the craft of government. He brought to his work a broad-minded and earthy understanding of human nature and society. He avoided easy answers to the challenges of governance. In the book, “S R Nathan in Conversation”, Mr Nathan was quoted as saying, “Policy decisions are complex – the straightforward „yes‟ or „no‟ answers often demanded by the critics are rarely possible. There are often grey areas, compromises – there is never an ideal solution to anything. You can very rarely have changes without some kind of sacrifice.” This observation naturally brings me to the topic of this evening‟s lecture – “Hunting Black Swans and Taming Black Elephants: Governance in a Complex World”. This is the first of four lectures – and they are all connected– so this is therefore a bit of a scene-setter. But all these lectures are linked, and I shall use the framework of complexity to explain some emerging concepts of governance in each of the four lectures. In addition, I shall use the approach of “circling and deepening”, a description that has been applied to the late Nobel Laureate Derek Walcott‟s work. I shall revisit themes and examples in every lecture – circling and deepening – around them in order to generate new insights and fresh learning points. Updated 6 April 2017. 1 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 But it is in this first lecture that I shall dive more deeply into complexity in order to explain what it is, and why it is so relevant to governments and to good governance in today‟s unpredictable and uncertain world. I shall also explain why

[p. 3 to 4](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=3) & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 But it is in this first lecture that I shall dive more deeply into complexity in order to explain what it is, and why it is so relevant to governments and to good governance in today‟s unpredictable and uncertain world. I shall also explain why the nature of governance is changing in response to complexity, and how governments can adapt to these changes. Complexity Stephen Hawking, the world-famous theoretical physicist, said, “I think the next century (the 21st century) will be the century of complexity.” But what is complexity? And what is its relevance to governance? Complex is different from complicated. An engineering system is merely complicated. It could be an A380 or a telecommunications satellite. Its inner workings may be very difficult for a layman, who is more likely than not to describe it as complex, when it is actually just complicated. Complicated systems have Newtonian characteristics in that they perform pre- determined functions that are predictable and repeatable, in which input leads to a predictable outcome. In contrast, a complex system will not necessarily behave in a repeatable and pre-determined manner. This is because a system that is complex contains a large number of autonomous parts – agents – connected to one another, and interacting in a great many ways. They often generate their own feedback loops. To understand the behaviour of a complex system, we must understand not only the behaviour of each of these agents but also how they interact with one another, and then how they act together as a whole. But with the current state of science, this is an almost insurmountable challenge. Cities – like Singapore – are undoubtedly complex systems. They are made up of hundreds of thousands, even millions, of people – who are the agents in the parlance of complexity. Each person interacts with others, producing outcomes that often confound and astonish planners and policy-makers. Jane Jacobs, an American scholar of urban systems, aptly described the Updated 6 April 2017. 2 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 complexity of cities in her highly influential book “The Death and Life of Great American Cities”. She wrote, “City processes in real life are too complex to be routine, too particularized for application as abstractions. They are always made up of interactions among unique combinations of particulars, and there is no substitute for knowing the particulars.” All human systems are complex, not just cities. Countries are complex, as are political systems. The world as a whole is complex. There are many definitions of complexity, but all of them agree that complex systems are characterised by the property of emergence. The connections and interactions among the many agents in a complex system lead to outcomes that are inherently unpredictable ex ante, and that are

[p. 4 to 5](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=4) cities. Countries are complex, as are political systems. The world as a whole is complex. There are many definitions of complexity, but all of them agree that complex systems are characterised by the property of emergence. The connections and interactions among the many agents in a complex system lead to outcomes that are inherently unpredictable ex ante, and that are only revealed when they actually occur. So, when something happens, we are surprised. Black Swans Nicholas Nassim Taleb famously described one class of such surprises – rare and hard-to- predict events – as black swans. In Taleb‟s view, black swans are not just surprising, but also have another important characteristic: their impact is large and game-changing. In 2002, not long after 911, Donald Rumsfeld who was then US Secretary of Defense, introduced us to a close relative of the black swan, the unknown unknown. He said, “There are known knowns. These are things we know we know. We also know there are known unknowns. That is to say we know that there are some things we do not know. But there are also unknown unknowns, the ones we don‟t know we don‟t know.” Now, you may laugh, but if you are in the business of government, or if you have at least a passing interest in our future, then you ought to understand what known unknowns are, and Updated 6 April 2017. 3 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 what unknown unknowns are, because you are going to be surprised by both every now and then. And it helps to understand the difference between them. Strategic Surprise When I was a young officer in MINDEF in the early 1980s, I think I would have found it very difficult, if not impossible, to grasp the concept of transnational terrorism that today preoccupies governments around the world, because the conditions that produced Al Qaeda and the Islamic State did not exist in those days. And in those days, cyber warfare was a concept that we could only dimly understand, because the underlying technology was only just emerging. Today, such things have become part of mainstream thinking. Indeed, one of the foremost challenges facing any government is the challenge of strategic surprise. Singapore has experienced many of our own strategic surprises in our short life as an independent state. The Asian financial crisis of 1997/1998 was one, as was the uncovering of the Jemaah Islamiyah (JI) terrorist network in December 2001. The Severe Acute Respiratory Syndrome (SARS), which hit Singapore in February 2003, precipitated a national crisis, leaving more than 30 people dead, and caused a recession that year. Then in 2008/2009, the shocking and unexpected collapse of Lehman Brothers led to the global economic and financial crisis. Since then, there has been a succession of shocks, including the drastic plunge in oil prices that began in 2014,

[p. 5 to 6](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=5) hit Singapore in February 2003, precipitated a national crisis, leaving more than 30 people dead, and caused a recession that year. Then in 2008/2009, the shocking and unexpected collapse of Lehman Brothers led to the global economic and financial crisis. Since then, there has been a succession of shocks, including the drastic plunge in oil prices that began in 2014, the reverberations of which are still being felt today, Brexit, and most recently, the US Presidential Election. The Butterfly Effect The complexity of our world owes a lot to its highly-interconnected nature. The world has been transformed by huge leaps forward in technology in the last half century, especially in telecommunications and more recently the Internet. These, combined with innovations in transportation such as the container and commercial jet aircraft, have catalysed globalisation and led to vastly increased trade as well as the movement of people around the world. The resulting increase in density of connections and feedback loops has in turn greatly increased complexity at the global level. Updated 6 April 2017. 4 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 In this highly-interconnected world, what happens in one part is going to affect other parts – the so-called butterfly effect which postulates that the flap of a butterfly‟s wings in Brazil can set off a tornado in Texas. This was the title of a lecture by Dr Edward Lorenz. The butterfly effect is the concept that small changes in initial conditions can produce large effects in a complex system. Not surprisingly, it was in weather forecasting that scientists gained a lot of insights into this phenomenon. More generally, events and actions in different parts of a highly- interconnected system interact with each other in complex, non-linear ways, to produce effects that are difficult to determine ex ante. Instead, to use the term I introduced earlier, their behaviour is emergent. To reiterate, this is the defining characteristic of the complex world that we live in today. The Tohoku Earthquake A vivid example of the butterfly effect is the Tohoku earthquake that occurred six years ago. Japan is one of the most seismically active regions in the world. So why was the calamity that befell Japan on 11th March 2011 such a big surprise? Was it because of the scale of the disaster? Indeed, the Tohoku earthquake and tsunami was a huge catastrophe for Japan. It killed around 18,000 people and resulted in direct material damages estimated by some at well over US$250 billion for Japan, making it the most expensive natural disaster in history. But an equally important reason is the butterfly effect – the chain of events, beginning with the earthquake, which triggered a large tsunami, which then damaged the Fukushima nuclear power plant, causing a meltdown and radiation leakage. Arguably, it was the meltdown that was the black swan. Its impact was felt far

[p. 6 to 7](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=6) it the most expensive natural disaster in history. But an equally important reason is the butterfly effect – the chain of events, beginning with the earthquake, which triggered a large tsunami, which then damaged the Fukushima nuclear power plant, causing a meltdown and radiation leakage. Arguably, it was the meltdown that was the black swan. Its impact was felt far beyond Japan, like the hypothetical tornado in Texas. It brought the safety of civilian nuclear power into question, not just in Japan, but around the world, and led one major economy half a world away from Fukushima – Germany – to foreswear its use. The Fukushima nuclear disaster was the result of complex interconnections and interdependencies, combined in this case with significant human failures including outright negligence and what Margaret Heffernan called “wilful blindness” in her book of that title. The reality is that it is extremely difficult to estimate the cumulative effects of such complex events. It makes preparing for unforeseen situations an exercise fraught with difficulty. It also adds to the challenges of governments operating in complex situations. Updated 6 April 2017. 5 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 The Arab Spring In December 2010, Mohamed Bouazizi, a street vendor in Tunis set himself alight. He was upset that he was not heard by the authorities, that he was being harassed. It was a terminal protest, because he died from the self-immolation. But that single act – a single event – triggered the Arab Spring. The consequences were dramatic. Governments collapsed in Tunisia, Egypt, Libya and Yemen. Governments changed in Kuwait, Bahrain and Oman. A civil war broke out in Syria, and it is still raging more than six years after Bouazizi killed himself. It can be argued that these events set the stage for the rise of the Islamic State. The most imaginative novelist could not have written the script for the Arab Spring. It would have taken the bravest analyst a huge leap of imagination to predict the Arab Spring, such as it was. Truth, as it is often said, is stranger than fiction. The famous British historian and politician, H A L Fisher, concluded in 1935, not without a touch of irony, that, “Men wiser and more learned than I have discerned in history a plot, a rhythm, a predetermined pattern. These harmonies are concealed from me. I can see only one emergency following another ... and only one safe rule for the historian: that he should recognise in the development of human destinies the play of the contingent and the unforeseen.” In other words, we shall continue to be surprised. Hindsight The Arab Spring has spawned a growth industry. There are now countless political and social scientists, historians and Arabists all trying to explain the causes of the Arab Spring. Many will find convincing reasons as to why these

[p. 7 to 9](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=7) development of human destinies the play of the contingent and the unforeseen.” In other words, we shall continue to be surprised. Hindsight The Arab Spring has spawned a growth industry. There are now countless political and social scientists, historians and Arabists all trying to explain the causes of the Arab Spring. Many will find convincing reasons as to why these events unfolded as they did. But all this will be in retrospect. It is in the very nature of such post-mortem analyses that thinking and explanation must be fundamentally backward-looking. That explanations after the Updated 6 April 2017. 6 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 fact are the norm for strategic surprises like the Arab Spring and the Fukushima nuclear disaster underlines the lack of any simple patterns in the complex world that we live in. The 19th century Danish philosopher, Søren Kierkegaard, observed that “life is understood backwards, but must be lived forwards.” You can look backwards in time to understand why something happened. That is hindsight. But hindsight does not necessarily translate into foresight. Simply because we can provide an explanation for why the current state of affairs has arisen does not mean that we are in a position to forecast the next drama or political catastrophe. Instead, these outcomes seem to be lurking somewhere, hidden from view, just over the horizon or around the corner, to surprise us when we least expect it. That is the problem. We cannot predict the future. Undoubtedly, there are fascinating “what if” questions arising from the drama of the Arab Spring. What if Mohamed Bouazizi had not set himself on fire? Or what if he had survived the self- immolation? Would there have been an Arab Spring? The fact of the matter is that we cannot really answer such what if questions. The propensity to agonise over and analyse surprising and shocking events such as the Arab Spring satisfies the emotional need for answers to questions like what if and why. But such illumination will not necessarily help us to anticipate or avoid the next strategic shock. The future is neither inevitable nor immutable. Applying the lessons of history is not enough to guide us down the right path into the future. Indeed, it is doubtful whether a single right path even exists. Singapore‟s founding Prime Minister, the late Mr Lee Kuan Yew, said, “The past was not pre-ordained, nor is the future. There are as many unexpected problems ahead as there were in the past.” It sounds like a truism, but it is the reality that governments have to deal with. Updated 6 April 2017. 7 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 Complexity and Governments The complexity of the world

[p. 8 to 10](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=8) It sounds like a truism, but it is the reality that governments have to deal with. Updated 6 April 2017. 7 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 Complexity and Governments The complexity of the world is something that governments should not ignore. The rise of complexity will generate more uncertainty, and increase the frequency of black swans and other strategic surprises. In other words, complexity can cause big headaches for governments. On the other hand, governments that make the effort to understand complexity, and then to learn to manage complexity, will gain a big competitive advantage. While they cannot avoid black swans altogether, they will be in a better position to subdue the impact of strategic surprise and reduce uncertainty. They will also be better placed to exploit opportunities ahead of the rest. Professor Kees van der Heijden, the pioneer Dutch scenario planner, said, “There are winners because there is uncertainty. Without uncertainty, there can be no winners. Instead of seeing uncertainty as a problem, we should start viewing it as the basic source of our future success.” In fact, it was Charles Darwin who first recognised that uncertainty is a necessary pre-condition for change and adaptation to occur. And it is complexity that produces the uncertainty essential for innovation and serendipity. In this regard, economists like Ricardo Hausmann and César Hidalgo argue that the most important predictor of growth is economic complexity, or the diversity of products that an economy possesses. So, complexity has an upside as well, and I will touch on this in more detail in my third lecture. Yet, governments often ignore the complexity of their operating environment. They typically deal with complexity as if it is amenable to simple and deterministic, even linear, policy prescriptions. In a sense, the crux of public policy has been to apply – if not impose – orderly solutions to the myriad of complex problems that afflict our societies, our politics and our lived everyday experiences, in largely vain attempts to make what is complex merely complicated. We see this in legal systems that are based on uniform punishments to complex and varied Updated 6 April 2017. 8 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 crimes, in public health enterprises that treat patients as largely homogenous, and education systems and pedagogies that assume that all children develop uniformly, or ought to. Human Nature This phenomenon points to an additional layer to the challenge of complexity, and that is our own human nature. All human beings – including the great and the good – are afflicted with cognitive biases or more simply, blind spots. Many disruptions – natural disasters, pandemics, even financial crises and political upheavals – do not fall into the

[p. 10 to 11](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=10) Human Nature This phenomenon points to an additional layer to the challenge of complexity, and that is our own human nature. All human beings – including the great and the good – are afflicted with cognitive biases or more simply, blind spots. Many disruptions – natural disasters, pandemics, even financial crises and political upheavals – do not fall into the category of black swans. Instead more often than not, they are either known knowns, or known unknowns. Once upon a time, all disasters – storms, floods, earthquakes, volcanic eruptions – arrived without warning. Today, modern science helps to forecast such cataclysms with increasing accuracy. Many of such disruptions can now even be assigned probabilities. This ought to lead governments to take precautionary measures. But often, they do not. In his bestseller “Collapse”, the scientist and polymath, Jared Diamond, alludes to the inability to read trends or to see behind the phenomenon of creeping normality. Things get just a little bit worse each year than the year before, but not bad enough for anyone to notice. It is like the proverbial frog in boiling water. Indeed, people often have a hard time properly ascertaining the present value of events that will take place in the future. This tendency to discount the future – to place less emphasis on future risks and contingencies, and instead to place more weight on present costs and benefits – is a common cognitive bias known as hyperbolic discounting. Governments are particularly susceptible to the cognitive bias of hyperbolic discounting. The institutional position that political leaders occupy discourages them from spending time worrying about a problem that will – hopefully – disappear, or only occur after they leave office. Updated 6 April 2017. 9 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 This begs the question of how viable a public policy enterprise is, if the boundary condition is the term of a particular government at worst, or the lifetime of the already-born citizen at best? Related to this is the question of responsibility and trade-offs. For example, it can be argued that the current generation has a responsibility of stewardship of the future. However, in order to fulfil that duty, certain tough decisions have to be made and taken in the here and now. How much appetite is there really for such long-term thinking, in this society, or in any society? At the risk of generalisation, many governments tend to focus on immediate problems and priorities related to the election cycle. They would rather defer expenditure on something that may or may not happen. This is why, despite understanding the threat posed to future generations by global warming, many governments discount those effects and instead place greater emphasis on the current costs of mitigation and adaptation – leading to really suboptimal policies – if one takes the long view. The Black Elephant This

[p. 11 to 12](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=11) rather defer expenditure on something that may or may not happen. This is why, despite understanding the threat posed to future generations by global warming, many governments discount those effects and instead place greater emphasis on the current costs of mitigation and adaptation – leading to really suboptimal policies – if one takes the long view. The Black Elephant This leads me to another member of my menagerie, the black elephant. What is the black elephant? The black elephant is the evil spawn of our cognitive biases. It is a cross between a black swan and the proverbial elephant in the room. The black elephant is a problem that is actually visible to everyone, but no one wants to deal with it, and so they pretend it is not there. When it blows up as a problem, we all feign surprise and shock, behaving as if it were a black swan. Last year, many of us would have been astonished to learn that the Treasury in the United Kingdom had made no contingency plans for Brexit, despite the fact that the polls showed that the outcome of the referendum would be a close call. The British military – which I presume is like most armed forces and makes contingency plans at the drop of the hat – also reportedly did nothing. The UK government looked decidedly flat-footed the day after the referendum. Surely this is an example of a black elephant? In fact, the only institution that had a Plan B was the Bank of England. My surmise is that because the Governor is not British – Mark Carney is Updated 6 April 2017. 10 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 Canadian-Irish – he had no emotional skin in the game, and could take an objective, dispassionate, look at the situation. In 2013, a small Ebola outbreak in Guinea ballooned within a year into an international health emergency in August 2014. Over 10,000 people died, and the economic cost to the affected nations in West Africa is estimated in the billions of dollars. But it could have been nipped in the bud if appropriate actions had been taken at the start. These examples illustrate the tendency of the human mind to underestimate or ignore both sudden crises, as well as slow burn issues. Often through hesitation, and until events reach crisis proportions, no one takes any action. Unfortunately, the black elephant is not an endangered species in the wild jungles of government. At best, we can try to cull them, but they are a resilient lot because of our collective cognitive failures. Governance in Complexity So, what can governments do to improve the way they manage complexity, and at the same time mitigate the effects of the various cognitive biases that afflict them? One of the pioneer members of the Singapore Cabinet, Mr S Rajaratnam,

[p. 12 to 13](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=12) can try to cull them, but they are a resilient lot because of our collective cognitive failures. Governance in Complexity So, what can governments do to improve the way they manage complexity, and at the same time mitigate the effects of the various cognitive biases that afflict them? One of the pioneer members of the Singapore Cabinet, Mr S Rajaratnam, was a very forward-looking person with a strategic outlook. Way back in 1979, he said, “There are practical men who maintain that such speculations [thinking about the future] are a waste of time. And they have no bearing at all on solutions to immediate day-to-day problems. This may have been so in earlier periods of history when changes were few and minute, and were spread over decades and centuries. But because we are not only living in a world of accelerating changes but also of changes which are global in scope and which permeate almost all aspects of human activity ... And since change is about the future, then only a future-oriented society can cope with the problems of the 21st century.” Updated 6 April 2017. 11 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 Mr Rajaratnam was talking about the operating environment of a globalised and complex world, in which the pace of change is accelerating. How do we cope with that? We must learn to think systematically about a future that is inherently Volatile, Uncertain, Complex and Ambiguous (VUCA). But herein lies the conundrum that all governments face. How do you make plans and policies for the long term, knowing that changes in the operating environment are likely to occur within a shorter time frame, and that they will inevitably impact or even negate these plans? When you launch any big capital or infrastructure programme, you make certain assumptions. But inevitably, there will be changes in technology, and disruptions to the strategic environment. How do you factor in these changes, many of which cannot be foreseen, into plans and policies that we would like to last for 10, 20 years, maybe even much longer? Foresight or Futures Thinking We can start by accepting that complexity creates uncertainty. Prediction is not possible. Indeed, if it was, many of us would be out of jobs. Instead, as Mr Rajaratnam argued, the right approach is an orientation towards thinking about the future in a systematic way. Clearly, changes need to be made to the way governments organise themselves. Their toolbox must be enlarged. We can adopt methods and processes that help us to reduce the frequency of strategic surprise, and when the inevitable shock occurs, to reduce the amplitude or intensity of its impact. Some of us call this foresight, or futures thinking. It helps policy-makers in government devise strategies and formulate policies to maintain positive trajectories and shift negative ones into a more positive direction. The goal

[p. 13 to 14](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=13) processes that help us to reduce the frequency of strategic surprise, and when the inevitable shock occurs, to reduce the amplitude or intensity of its impact. Some of us call this foresight, or futures thinking. It helps policy-makers in government devise strategies and formulate policies to maintain positive trajectories and shift negative ones into a more positive direction. The goal is to make better decisions today that can help shape the future, rather than to predict the future which would be a futile exercise anyway. Scenario Planning There are foresight methodologies – ways to think about the future systematically, and ways to help overcome some of our latent biases and our inherent cognitive constraints. One of them is the famous scenario planning method, which was developed and pioneered by the oil giant, Shell. In fact, by using scenario planning, Shell famously avoided the impact of the oil shock after an Arab oil embargo imposed in 1973 after the Yom Kippur War. Updated 6 April 2017. 12 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 In the late 1980s, the Singapore government began using Shell‟s scenario planning techniques, starting in the Ministry of Defence (MINDEF). Today, scenario planning is a key part of the Singapore government‟s strategic planning process. Indeed, the government takes scenario planning very seriously. National scenario planning exercises are run every few years, and are even incorporated into the annual budget cycle. The resultant scenarios are used by ministries and agencies as a base reference for their own strategic planning. The first effort at scenario planning at the national level in 1997 produced two scenarios – Hotel Singapore and a Home Divided – whose impact was profound. But they were particularly important then because, among other things, they helped to widen the focus of the government lens from geo-political and geo-economic issues to cover issues of Singapore society like ageing and social capital, local and community identity, and new fault lines. They led to the establishment of the National Volunteerism and Philanthropy Centre, and the Elderly Division in the then Ministry for Community Development. Their influence continues to this day. Used intelligently, scenarios make people aware of problems, uncertainties, challenges and opportunities that such an environment would present – opening up their imagination and initiating learning processes. An example outside of government is Action Plan Singapore, a series of scenario planning exercises run by the Institute of Policy Studies (IPS) starting last year, covering skills, longevity and innovation. The big benefit of scenario planning is that it helps to overcome our cognitive biases by surfacing hidden assumptions and challenging mental models. It helps planners and policy- makers to move out of their comfort zones, begin to think the unthinkable, and more willingly explore fresh strategies. Scenario planning helps to inculcate an anticipatory mindset in planners and policy-makers so that they instinctively raise what if questions

[p. 14 to 16](https://lkyspp.nus.edu.sg/docs/default-source/default-document-library/mr-peter-ho-s-speechefb2087b46bc6210a3aaff0100138661.pdf#page=14) that it helps to overcome our cognitive biases by surfacing hidden assumptions and challenging mental models. It helps planners and policy- makers to move out of their comfort zones, begin to think the unthinkable, and more willingly explore fresh strategies. Scenario planning helps to inculcate an anticipatory mindset in planners and policy-makers so that they instinctively raise what if questions on the issues they deal with. It helps them to overcome their blind spots, and to confront or at least be aware of black elephants. Updated 6 April 2017. 13 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 Horizon Scanning Notwithstanding these enormous benefits, scenario planning also has some limitations. Scenario planning is not very useful in locating the black swans and unknown unknowns that are lurking over the horizon. The Nobel economist and strategic thinker, Thomas Schelling, explained, “One thing a person cannot do, no matter how rigorous his analysis, or heroic his imagination, is to draw up a list of things that would never occur to him.” To address this deficiency, even if only partially, in Singapore we have adopted other tools as well. While scenario planning remains the base, a wider range of foresight tools for horizon scanning are now deployed. Horizon scanning tries to identify the big game-changers by looking for emerging issues and trends, and delving into them to see where the threats and opportunities are. To support this effort, the Singapore government also developed a computer-based suite of tools called the Risk Assessment and Horizon Scanning system, or RAHS. It is actually a pioneering big data system that is used to search for weak signals that could evolve into sudden shocks, among other things. Collectively, these tools help planners to uncover and discover some – but certainly not all – of the black swans and unknown unknowns out there. Wicked Problems The complexity of our operating environment that produces black swans also produces wicked problems. Design theorists, Horst Rittel and Melvin Webber, described wicked problems as complex, large and intractable, with no immediate or obvious solutions. They have causes and influencing factors that are not easily determined ex ante. They hardly ever sit conveniently within the responsibility of a single agency. Worse, they have many stakeholders, each of which sees these problems from different perspectives, and who have divergent goals. This means there are no immediate or obvious solutions, because nobody can agree on what the problems are in the first place, never mind what the solutions should be. Updated 6 April 2017. 14 IPS-Nathan Lectures The Challenges of Governance in a Complex World Lecture I – Hunting Black Swans & Taming Black Elephants: Governance in a Complex World, by Peter Ho 5 April 2017 It is not at all difficult to find wicked problems. They include the big challenges of our age, such as climate change, the environment, population, urbanisation,

---
Continues in https://guptaoption.com/texts/159-2.md (part 2 of 2).
End of [159] Taming Black Elephants, part 1 of 2. Its connections are at the top of this file; the map is https://guptaoption.com/llms.txt.