Uncertainty

An attribute of Agile software development I have been pondering lately is uncertainty.

We might argue that uncertainty is just one of many sources of friction, but because
it is such a pervasive trait of software development, I will treat it singly.

All actions in our software development life cycle take place in an atmosphere of uncertainty. Uncertainty pervades our operations in the form of unknowns about the competition, about the environment, and even about our own business. While we try to reduce these unknowns by gathering information, we must realize that we cannot eliminate them—or even come close. The very nature of business makes certainty impossible; all actions in business will be based on incomplete, inaccurate, or even contradictory information.

Business is intrinsically unpredictable. At best, we can hope to determine possibilities and probabilities. This implies a certain standard of executive judgment:

What is possible and what is not?

What is probable and what is not?

By judging probability,we make an estimate of our competitor’s designs and act accordingly. Having said this, we realize that it is precisely those actions that seem improbable that often have the greatest impact on our outcomes.

Because we can never eliminate uncertainty, we must learn to act effectively despite it. We can do this by developing simple, flexible plans; planning for likely contingencies; developing standing operating procedures; and fostering initiative
among subordinates.

One important source of uncertainty is a property known as nonlinearity. Here the term describes systems in which causes and effects are disproportionate. Minor incidents or actions can have decisive effects. Outcomes of battles can hinge on the actions of a few individuals, and as Clausewitz observed, “issues can be decided by chances and incidents so minute as to figure in histories simply as anecdotes.”

By its nature, uncertainty invariably involves the estimation and acceptance of risk. Risk is inherent in business and is involved in every project. Risk is equally common to action and inaction. Risk may be related to gain; greater potential gain often requires greater risk. The practice of concentrating business resources toward the main effort necessitates the willingness to accept prudent risk elsewhere. However, we should clearly understand that the acceptance of risk does not equate to the imprudent willingness to gamble the entire likelihood of success on a single improbable event.

Part of uncertainty is the ungovernable element of chance.Chance is a universal characteristic of business and a continuous source of friction. Chance consists of turns of events that cannot reasonably be foreseen and over which we and our competitors
have no control.

The constant potential for chance to influence outcomes in our business initiatives, combined with the inability to prevent chance from impacting on plans and actions, creates psychological friction. However, we should remember that chance favors no one exclusively. Consequently, we must view chance not only as a threat but also as an opportunity which we must be ever ready to exploit.

(Note: This is an exercise in rewriting existing text created for another purpose. Any guess as to the source material for this post?)