The Risk in the Status Quo

When Societies or Companies fail to innovate out of a fear of the risks associated with innovation, they fall into irrelevance and perish.

This past weekend we went to the theaters to see Ready Player One.  I did enjoy the movie. Like everyone watching it, there were numerous quotes and situations within the movie that reflect strongly to our current world. One theme that kept coming back to me was something that hit me in the beginning of the movie and again at the end.

In the exposition at the beginning of the film, main character Wade Watts is heading to his van, where he keeps his gear for entering The Oasis, a virtual reality universe where you can be anyone you want and do anything you want from play racing games to going to dance clubs to vacationing in exotic locales. Wade lives in The Stacks, which is nothing more than a series of trailers stacked on top of each other Jenga-style at least 20 trailers tall. As he climbs down from his trailer in the stack, you see glimpses of the people living in them who are wearing headgear and are in the Oasis, playing sports, boxing or even dancing, oblivious to the conditions around them. Wade’s van is buried in a stack of old vehicles that look like a junkyard trash heap, and that is where his equipment is set up to allow him to enter The Oasis.

On the way to the van, Wade explains for the audience that there had been a series of terrible events in society, including serious droughts, that was essentially enough to break the spirit of everyone in society. The Oasis came along at a time, Wade says, when people stopped trying to solve problems, and simply tried to survive them. The Oasis was their escape. It was what got them through. It was how they avoided thinking about and dealing with the horrors of their actual lives. Given what their daily lives looked like, which also include an unlimited corporatocracy and modern takes on debtor’s prisons, it is completely understandable how this would happen.

I will not spoil the end of the movie for those who have not seen it, but one thing that happens is that the Oasis shuts down two days a week, on Tuesdays and Thursdays. This is done explicitly so that people can spend more time in The Real World, where Oasis creator James Halliday explains everyone should be because “It’s the only place you can get a good meal. It’s the only thing that is real”. As I left the movie, I wondered strongly whether and for how much longer their society would continue with the status quo, if people were now forced to live in it without the Oasis two days a week. I wondered whether and how quickly change would come.

There is a risk in attempting to maintain the status quo, especially within society and the working world. The allergy to change which seems to develop within institutions, dressing itself up as the innocuous maintenance of stability. I strongly believe that becoming too attached to the status quo is something that should be included in every discussion about risk and every risk register completed for any entity.

What makes stability so risky? After all, markets like stability. People like stability. Change is scary and unpredictable, and things may not turn out the way you would prefer. Plans get tossed to the wayside, and it’s much easier to follow a well-established plan.

The risk comes as a result of the death of innovation and progress. When all efforts are focused on maintaining the status quo, anything that presents a risk to that status quo is quashed. But here’s the thing: Innovation is a risk. Trying something new is a risk. Because Innovation and Risk cannot be separated, companies or societies who are too risk averse fail to innovate. When they fail to innovate, they fall into irrelevance and eventually perish in this ever-changing world.

Thinking creatively about problems can lead to a myriad of innovative solutions to solve our toughest challenges. But we also must accept the risk that comes with trying such innovative solutions. Otherwise, the problems will continue to fester, never being solved.

Here is a perfect real-world example. In this 2013 Ted Talk, Financial Expert Roger Stein explains a bold new idea for funding cancer drug research. Lifesaving drugs are currently stalled in development, he says, because it is financially risky to fund the trials necessary to get them to market. To deal with this risk, he proposes creating a portfolio of these drugs, grouping them together to smooth out risk, and selling those. His models showed good returns on investment, and it would break the log jam.

Is this a similar model to what got us into trouble in the years before 2008 with subprime mortgages? Yes, it absolutely is. But with proper oversight and regulations, the portfolios could remain balanced and greatly reduce the danger of an implosion. But without people willing to shake up the status quo and give this new idea a try, lifesaving drugs could remain untested in labs as people continue to die from cancer. Shouldn’t we want that status quo to be disrupted?

 

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