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Thursday, November 19, 2009

To Burn or Not to Burn … That is the Question

image In 1519, Hernan Cortés landed with a fleet of 12 ships near present day Veracruz, Mexico. The flotilla held 500 Spaniards, 300 natives, a dozen horses and a few cannons. Cortés’ aim was to conquer the Aztec Empire and take possession of its great wealth.

The legend is that before launching the attack, Cortés burned his ships to prevent his men from retreating.

Through the ages this brazen act has come to represent fully committing to a course of action. Going all in. Burning all bridges.

SAND BURN?

The legend is also wrong.

It turns out Cortés had nine of the twelve ships sailed into the sand, grounding them. There is no word on the other three ships. According to Hugh Thomas in the Conquest: Montezuma, Cortés, and the Fall of Old Mexico, the burning ship error derives from sloppy handwriting. Two Spanish words were confused in the written record: quebrando (breaking) and quemando (burning).

“The difference between the almost right word and the right word is really a large matter– it’s the difference between the lightning bug and the lightning.”

- Mark Twain

Cortés was successful in his conquest, but one wonders if he intended to use the three unharmed ships as a backup plan in case the expedition didn’t go well.

TO BURN OR NOT TO BURN … THAT IS THE QUESTION

While there are times it makes sense to burn ships to prevent retreat, there are other times when doing so is foolhardy. How do we discern which is which? The sketch below provides some insight.

As the personal cost of being wrong about an idea or decision increases along with the uncertainty of success, the size of the bet should be reduced.

For example, the negative consequences for a twenty five year old with no dependents who quits her job and maxes out a few credit cards to start a business that ultimately fails is much less than for a fifty year old with a child in high school and another in college who also quits his job and liquidates his 401k to start a similar venture.

The twenty five year old has many more years to get back on her feet whereas the fifty year old’s failure could have catastrophic consequences for his retirement.

Earlier, I mentioned testing new thoughts, trying new things, is the essence of expanding the present, but not everyone is brave enough to do it. Learning to scale our new endeavors based on the uncertainty of success and the personal cost of being wrong increases our courage to try new things.

I love the concept of the piecemeal engineer introduced by Karl Popper in Poverty of Historicism. A piecemeal engineer is a tinkerer—someone who doesn’t believe in burning ships. Piecemeal engineers seek to achieve their aims by “making small adjustments and readjustments which can be continually improved upon.” Like Socrates they know how little they know so they are always on the “lookout for the unavoidable, unwanted consequences of reform.”

The leading edge of the present is where the best ideas are found. It is also the realm of maximum uncertainty because it’s the jumping off point into the unpredictable future.

Experimenting is the key to minimizing pain amidst such uncertainty. Experiments increase flexibility to react to the unintended consequences of our actions, both the positive and the negative. And on the present’s leading edge there are always unintended consequences. Having a ship to retreat to when a surprise turns nasty not only can save our hides but it provides a safe haven to regroup before venturing out again.

About the Author
J.D. Stein has served as an investment strategist to institutional investors for over thirteen years. He writes about how to live and work on the leading edge of the present at NowSquared.com. J.D. resides within the Greater Yellowstone region of Idaho. Contact J.D. Stein at nowsquared@gmail.com

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