Risk Management

, Volume 12, Issue 1, pp 54–82 | Cite as

Avoiding extreme risk before it occurs: A complexity science approach to incubation

Original Article
First Online:

Abstract

Crises appearing in many kinds of organizations are found to be mostly caused by management and workers. The acquisition of the Southern Pacific railroad by the Union Pacific in 1996 provides a dramatic case of how tiny initiating events – incubation events – that appeared chaotic, random and unimportant to an arrogant management spiralled into a crisis. This article draws on theories from complexity science to explain how and why such spiralling processes are set off. The various kinds of initiating incubation events are connected to five specific scale-free theories. Knowledge of each scale-free theory, and others, offers managers improved chances of dealing with incubation events sooner. Given that people often ‘don’t see what they aren’t looking for’, scale-free theories are a means of lessening cognitive blindness and giving the concept of mindfulness more visual substance. As managers train to be more sensitive to scale-free causes, their chances of avoiding extreme crises are improved.

Keywords

incubation crises complexity science scalability UP/SP merger mindfulness 
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© Palgrave Macmillan, a division of Macmillan Publishers Ltd 2010

Authors and Affiliations

  1. 1.UCLA Anderson School of ManagementLos AngelesUSA
  2. 2.Durham Business School, Durham UniveristyDurhamUK

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