Chapter 1: Embracing Uncertainty
"The only 'risk' which leads to a profit is a unique uncertainty....Profits arise out of the inherent, absolute unpredictability of things."
-- FRANK KNIGHT, UNIVERSITY OF CHICAGO ECONOMIST, 1921
On March 17, 2000, a lightning bolt ignited a fire in Albuquerque, New Mexico, destroying a Philips semiconductor plant. Across the globe in Scandinavia, both Nokia and Ericsson depended on the factory for key chips in their cellular phones, and this chance disaster threatened to choke off their production. Nokia responded fast and flexibly, recognizing the problem thanks to its dynamic monitoring....