Interviewer: Today I'm interviewing
Paul Schoemaker, who is research director
of the Mack Institute for Innovation
Management at the Wharton School.
thank you for joining us today.
How is the coronavirus likely
to affect big companies?
Prof. Schoemaker: This is
unprecedented for many organizations,
they've been around for centuries so
things do happen that come out
of the blue, but we distinguish between
cases where you can do risk analysis and
get probabilities estimated from
cases where it's really uncertain.
Maybe you can speculate about outcomes,
but you can't easily put probabilities
into the picture, and I think we're not
even in that situation, it's worse.
I think we're in more ambiguous territory,
we don't even know what the issues are,
the business challenges
caused by the virus.
You might even argue that we are in
an era of great ignorance and chaos,
which means you need to navigate
the unknown, and that is a test for
most organizations because
they want to be in control.
The notion of being humble and developing
very general strategies that can be
adapted to the unexpected is
the example of a black swan.
Not many people saw this coming,
and that's quite different from
people who are just good at peripheral
vision or scanning the horizon.
This is really having to respond
to an out-of-the-blue development.
And very few do it well,
but the companies that do it well
we would term 'vigilant companies'.
They would also have exhibited this
capacity in other ways, to anticipate,
to look around corners and
be agile in their responses.
What most companies are struggling
with is they are fire-fighting,