Agility

Saturday, May 02, 2009

Dwight Eisenhower said “Plans are nothing, planning is everything”. I couldn’t agree with him more. The second you create a plan it is probably overcome by events (OBE). Not being an expert on chaos theory, anything I say about it is probably wrong, but I believe the fundamental principle of it is that the world and most complex systems have too many independent variables to be predictable. Therefore any plan cannot account for all the variables.
This doesn’t mean that planning is not required. In fact, as the quote illustrates, it is everything. Planning can provide us with situational awareness, so that as things happen we react in accordance with pre-established goals or outcomes in mind.
Years ago (probably in the 1970s) I got a free book on investing when I subscribed to someone’s magazine (I actually don’t remember what magazine it was). The book actually had a lot of useful explanations of market terminology and various investment instruments. It also had a section where it provided advice garnered form successful investors. One bit of advice that I have tried to follow since then was quite simple. Accept the fact that you will be wrong a significant amount of the time.
A lot of people, if not all, tend to have a high opinion of their own insights. However, if you do something and expect a certain result, if you don’t get it, you were wrong. Accept it. It is now time to do something else. The plan that you had needs to be adjusted. You need to be agile.