Meltdown

How do catastrophes occur? This is the sizeable question tackled by Chris Clearfield, former trader and business coach, and András Tilcsik, a professor of strategic management at Toronto’s Rotman School of Management. The first part of the book retraces a variety of sequences that have led to spectacular failures over recent decades: the Three Mile Island nuclear accident in 1979, a collision between two subways in Washington in 2009 due to the progressive forgetting of a safety procedure, or the loss of 440 million dollars by trading firm Knight Capital in 2012 as a result of a software update issue. The common factor in these accidents is their systemic nature: the systems in place, by their levels of complexity and interdependence, became more vulnerable to domino effects, in which minor errors accumulate, aggravate and ultimately lead to disaster. In the second part, the authors offer advice on analyzing and reducing the level of vulnerability of the system in which companies operate, as well as on combating the culture of silence, which leads to failing to report minor problems that, when accumulated, can provoke major crises.