In a previous post I outlined 3 phases of distribution:
- Conventional phase
- Contingency phase
- Crisis phase
There is a difference in decision making matched to each phase. “Crisis Decision Making” is decidedly different than in normal times. The late great populist historian, Howard Zinn wrote a book and was the subject of a documentary entitled, “It Is Hard To Be Neutral On A Fast Moving Train” which outlined that life is different when events move fast.
Whether we talk about businessmen or hospital administrators making decisions in a crisis, a different calculus is required. The crisis phase is much more action oriented than during conventional circumstances. If you are out of phase, you continue asking the wrong questions. Obsessing about the cost of a bottle of water when you are thirsting in the desert could kill you.
The current COVID-19 crisis has many in the health care industry (and business) desperately holding on to the same principles as if these are normal, conventional times. The health care system is convulsing under the inability to understand that time is the currency, not money.
If you make decisions in a crisis phase based upon projections or forecasts, events can swallow you. Waiting around for clinical trials or precise evidence is beyond silly. Clipping disastrous “left tail risk” or avoiding ruin should be front and center. Hospitals have been slow in making decisions because they are out of phase.
In business, you must constantly adjust what you are willing to lose. You need to stop hand wringing and do something else. Hospitals need to think worst case scenarios rather than a strategy of hope. Those relying on forecasts to make decisions are out of phase. Some say this is evidence-based decision making. I think this is nerdish, data driven nonsense that crises crush.
When time is critical, you better understand that this is the real currency in transactions.