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Limits of Quantification

Quantification for most of the phenomena in a social ecology is misleading or at best useless.

The most important reason why I am not a quantifier is that in social affairs, events that matter cannot be quantified. For example, Henry Ford‘s ignorance in 1900 or 1903 of the prevailing economic wisdom that the way to maximize profit was to be a monopolist—that is, to keep production low and prices high—led him to assume that the way to make money was to keep prices low and production high. This, the invention of “mass production,” totally changed industrial economics. It would have been impossible, however, to quantify the impact even as late as 1918 or 1920, years after Ford’s success had made him the richest industrialist in the United States, and probably in the world. He had revolutionized industrial production, the automobile industry, and the economy in general, and had, above all, completely changed our perception of industry.

The unique event that changes the universe is an event “at the margin.” By the time it becomes statistically significant, it is no longer “future”; it is, indeed, no longer even “present.” It is already “past.”

ACTION POINT: Identify a unique event with an impact that is unquantifiable now, but is likely to transform your organization in the next decade. Be out in front and take advantage of the opportunities it will afford.

The Ecological Vision

* Source: The Daily Drucker by Peter F. Drucker

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