Book Review: Obliquity by John Kay
This is one of those books that totally gets me. I cannot possibly overemphasize the importance of reading this book if you are a leader of any kind – business, community, politics or even of your own household. The book, at least for me, articulates eloquently the struggle I have had with simplistic solutions I hear in business world on how to solve problems – “right talent” often being suggested as the panacea. This book – along with a cursory reading of a book like The Drunkards Walk should give a sobering thought to anybody who wants to be a leader.
By the way, I got to know about this book while listening to a Ted Talk by Rory Sutherland. Another guy with some great concepts
I am quoting a few paragraphs together from the book as is but there is simply no substitute to reading the book. And if you do read the book, call me. Would love to discuss your thoughts.
Excerpts:
The success of the physical sciences has encouraged us to believe there might be a science of decision making. All kinds of problems in our business and our financial lives, in the political and personal spheres, could then be managed objectively. Such a scientific procedure would, if done carefully enough, lead every conscientious person to the same answer. As a result, both political and personal disputes could be resolved by applying evidence and rational discourse. The distinction of the great business leader, the measure of financial acumen, would rest only in the ability to arrive at the right answer faster than other people.
There is no such science, and there never will be. Our objectives are typically imprecise and multifaceted; they change as we work toward them, as they should. Our decisions depend on the responses of others and on what we anticipate those responses will be. The world is complex and imperfectly understood, and it always will be.
We do not solve problems in the way the concept of decision science implies, because we can’t. The achievement of the great statesman is not to reach the best decision fastest but to mediate effectively among competing views and values. The achievement of the successful business leader is not to foresee the future accurately but to continuously match the capabilities of the firm to the changing market. The test of financial acumen, as described by Buffett and Soros, is to navigate successfully through irresolvable uncertainties.
Mostly, we solve problems obliquely. Our approaches are iterative and adaptive. We make our choices from a limited range of options. Our knowledge of the relevant information, and of what information is relevant, is imperfect. Different people will form different judgments in the same situation, not just because they have different objectives but because they observe different options, select different information and assess that information differently; and even with hindsight it will often not be possible to say who was right and who was wrong. In a necessarily uncertain world, a good decision doesn’t necessarily lead to a good outcome, and a good outcome doesn’t necessarily imply a good decision or a capable decision maker. The notion of a best solution may itself be misconceived. The skill of problem solving frequently lies in the interpretation and reinterpretation of high-level objectives.
There is nothing wrong with using trust as a basis for decision. Finding people you can trust, or establishing trusting relationships with them, is the most effective—often the only effective—means of achieving the delegation that is necessary to accomplish objectives and goals in large organizations. Successful decentralization relies on the transmission of high-level objectives, not just intermediate goals and basic actions, to the agents who will implement them. This is a world apart from principal-agent models that treat social organizations as mechanical systems in which agents respond to the stimuli that incentive structures impose.
Obliquity is the best approach whenever complex systems evolve in an uncertain environment and whenever the effect of our actions depends on the ways in which others respond to them. There is a role for carrots and sticks, but to rely on carrots and sticks alone is effective only when we employ donkeys and we are sure exactly what we want the donkeys to do. Directness is only appropriate when the environment is stable, objectives are one-dimensional and transparent and it is possible to determine when and whether goals have been achieved. The world of politics and business today is afflicted by many hedgehogs, men and women who mistakenly believe the world is like that.

Even something as simple as my reading to do list becomes adaptive when new information is obtained. I’ll have to add this book to it.
That observation on reading list changing based on new things learnt is very true for me too! In fact, I put two books that I was reading on hold to download this one and read based on the mention Rory Sutherland made!
This proves again, if more proof is needed, that central planning doesn’t work for large, complex systems like countries.
Also, dings the certainty of data-driven decision-making!
Those are some of the key points in the book, indeed!