During the last years we, dentists and dental technicians, have been “bombarded” by potential threats and challenges for our dental business and profession in the near future: the threat of “dental amazonification”, the threat of machines substituting first technician and then dentists, the threat of dental chains and discount-clinics, the threat of abroad clinics offering cheap treatments, the dentist-overcrowding, the threat of medico-legal issues and the burden of insurances, just for citing a few.
For facing all these potential threats, we have been forced to update continuously, buy expensive machines, expand our dental clinic, increasing our management competences, employ more people, leasing, loaning, etc. etc.
And all these threats and challenges, empowered by a series of opinion leaders, were credible, but were just potential. They were in a non-existing realm: the future.
Before the discovery of Australia, people in the Old World were convinced that all swans were white, an unassailable belief as it seemed completely confirmed by empirical evidence. The sighting of the first black swan might have been an interesting surprise for a few ornithologists (and others extremely concerned with the coloring of birds), but that is not where the significance of the story lies. It illustrates a severe limitation to our learning from observations or experience and the fragility of our knowledge.
One single observation can invalidate a general statement derived from millennia of confirmatory sightings of millions of white swans. All you need is one single (and, I am told, quite ugly) black bird.
The black swan can be defined by the following triplet:
- is an outlier. It lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility
- it carries an extreme ‘impact’.
- in spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable.
As Taleb tells in his book Black Swan, all casino are geared towards reducing the losses resulting from cheaters: because it has always been considered considered the most risky part of the casino for avoiding failure and bankruptcy.
But they had never realized the the real issue of failure was outside the realm of thinking and forecasting of the casino’s experts. Indeed, the four largest losses incurred or narrowly avoided by the casino fell completely outside their sophisticated models of the risk experts of the casino:
- First, they lost around $ 100 million when an irreplaceable performer in their main show was maimed by a tiger (the show, Siegfried and Royhad been a major Las Vegas attraction). The tiger had been reared by the performer and even slept in his bedroom; until then, nobody suspected that the powerful animal would turn against its master. In scenario analyses, the casino had even conceived of the animal jumping into the crowd, but nobody came near to the idea of insuring against what happened.
- Second, a disgruntled contractor was hurt during the construction of a hotel annex. He was so offended by the settlement offered him that he made an attempt to dynamite the casino. His plan was to put explosives around the pillars in the basement. The attempt was, of course, thwarted, but I shivered at the thought of possibly sitting above a pile of dynamite.
- Third, casinos must file a special form with the Internal Revenue Service documenting a gambler’s profit if it exceeds a given amount. The employee who was supposed to mail the forms hid them, instead, for completely unexplainable reasons, in boxes under his desk. This went on for years without anyone noticing that something was wrong. The employee’s refraining from sending the documents was truly impossible to predict. Tax violations (and negligence) being serious offenses, the casino faced the near loss of a gambling license or the onerous financial costs of a suspension. Clearly they ended up paying a monstrous fine (an undisclosed amount), which was the luckiest way out of the problem.
- Fourth, there was a spate of other dangerous scenes, such as the kidnapping of the casino owner’s daughter, which caused him, in order to secure cash for the ransom, to violate gambling laws by dipping into the casino coffers.
The casino spent hundreds of millions of dollars on gambling theory and high-tech surveillance while the bulk of their risks came from outside their models.In dentistry has been happening the same.
Dentists and dental technicians have been spending millions of dollars of management courses, marketing courses, equipments, insurances, loans, leasing, mortgages, trying to minimize the impact of the potential threats, empowered by the experts. And suddenly in February 2020, something – outside the realm of the models and forecasting of dental experts – is knocking and locking down the entire dental business, mining its foundations.
A quite innocuous carbon-based virus triggered a bigger yet immaterial uncoiled carbonless virus, Panic, who has triggered a Black Swan that is shutting down all dental offices and dental labs, discovered to be “Carrier” and “Spreader” of a new threat for the population.
Nobody should have the arrogance to forecast the future, yet we should build an antifragile perspective able to make us more able to tolerate and adapt to future Black Swans. Creating debts with leasing, loans, mortgages is typical of a very fragile system that mine the society on every scale, from the Central Banks to the dental businesses. During those days we are going to face all debts issues, being accumulated in the last century, from Stock Market to the Small Businesses.