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Archive for March, 2010

Affluent countries have become increasingly interested in softer, fluffier research. David Brooks wrote in the New York Times today that people are more interested in understanding things like happiness, trust, and security–but in ways that are meaningful rather than just by statistics. This shift is not easy though. Brooks writes:

[M]odern societies have developed vast institutions oriented around the things that are easy to count, not around the things that matter most. They have an affinity for material concerns and a primordial fear of moral and social ones.

The attempt anyhow is welcome news to me for two reasons. First, a good portion of my own research, taken from an angle known as social constructivism, makes a case for nuanced understanding of qualitative trends. And second, the areas of application I have worked in, especially in political risk assessment, there is no substitute for qualitative analysis.

To repeat: making the case is not easy. In one of my consulting projects at the United Nations, I heard frequently about a “quick and easy” risk assessment tool–basically an excel sheet–peddled by one of the big five consulting firms. Now there’s a certain structural elegance to assigning hard numbers off the top of your head to something like “potential for protest by opposition,” and then adding all the numbers up, and then concluding country X is riskier to operate than country Y.

But devising good strategy to mitigate risk always involves understanding thoroughly the uncertainties that make up risk. After all, if everything was binary or without uncertain nuances, there would little need to understand risk.

Moreover, in most cases, risk cannot be mitigated by wielding hard, blunt instruments, like simply throwing money or guns at a problem. And that holds even if the problem is something as hard and blunt as terrorism.

That’s why American strategy in reducing risk of terrorism now talks more about smart power and soft power and less about shock and awe. If hard power is about getting others to do what you want, soft power is getting others to want what you want. (This is the classic formulation by Joseph Nye, now Dean at the Harvard Kennedy School.)

Hard power, from Wall Street to Kabul, has been based on hard numbers. Soft power requires dissing out that excel sheet for some time and thinking in terms of narratives, of nuanced if-then statements. That can seem messy; it can seem like more humanities than sciences, but guess which power is more cost-effective and less risky as long term objective.

So, here’s to a softer, more holistic understanding of risk and reward.

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