Enemies of Intelligence

Post partly based on Chapter 3 of Organizational Intelligence by Harold Wilensky, published in 1967, in which he identifies a number of factors that can impair organizational intelligence.

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Hierarchy and status

• Hierarchy encourages concealment and misrepresentation (for example, hiding bad news).

• Low status knowledge and insight is undervalued. For example, the warning signs of Pearl Harbour were seen and understood by subordinate officers, but this intelligence did not reach Army and Navy chiefs.

• Emphasis on loyalty and conformity - stifles new ideas and critical questions.

• Steep promotion ladder creates divide between those focused on personal career advancement and those focused on personal survival.

Wilensky identifies three possible remedies.

• Flatter hierarchies
• Single issue task forces (IBM identified as an early practitioner of this approach)
• Alternative communication channels

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Specialization and rivalry

• Fragmentation of knowledge and insight - nobody has the "big picture".

• Fragmentation of responsibility - nobody willing to tackle the difficult issues. For example, in 1950, nobody had the courage to tell Truman and McArthur that they might be mistaken about China's strategy for Korea. (This also links to the status question, see above.)

• A more recent example is the rivalry between the CIA and the FBI, said to be a contributory factor in the intelligence failures prior to September 2001.

Wilensky argues that if there is an organizational structure and leadership that can contain the rivalry and construct the big picture, then healthy competition can have a positive effect on intelligence. He cites Franklin Delano Roosevelt, who appears to have managed this reasonably well. However, successes of this kind are probably the exception rather than the rule.

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Centralization and concentration

Intelligence (sense-making, decision-making, learning) too remote from What-Is-Going-On (WIGO). (Note that Wilensky's appreciation of the limitations of central intelligence predates by several decades the Power-to-the-Edge doctrine.)

Centralized intelligence can create a false illusion of reliability (Wilensky's example is the CIA's misreading of the Bay of Pigs episode), and therefore a single point of failure.

However, Wilensky does advocate some degree of centralization and concentration, arguing that distribution of intelligence (especially geographical distribution) risks spreading the intelligence too thinly. While we may agree that some clustering and communication is still valuable, we no longer have to assume this means geographical proximity. We may also note that Wilensky was writing at a time when only a minority of the workforce would have had a college education, and despite his concerns about status quoted above, he does sometimes talk as if he expected the main contribution to organizational intelligence to come from the educated members of the workforce. Nowadays, we should want organizational intelligence to be more rigorously inclusive.

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Secrecy

A lot of intelligence activity places undue emphasis on secret sources and secret deliberations, not just in the military sphere but also in the commercial sphere. Wilensky argues that this emphasis can have a distorting effect, and points out that some extremely successful intelligence activities during the Second World War were based on detailed analysis of public sources.

Secrecy has the following pitfalls

• secret information is more difficult to verify
• unverified secret information is often given more weight than verified non-secret information
• secret information is restricted to a small circle of people with appropriate security clearance
• people with alternative opinions don't get security clearance, so the system perpetuates a narrow viewpoint
• lack of critical appraisal, intolerance of alternative views

One of the examples Wilensky quotes in his book is the extraordinary deception played by the British against German intelligence during the Second World War, in an episode known as Operation Mincemeat. Malcolm Gladwell (who has also been reading Wikensky's book) has just published an account of this story in the New Yorker, under the title Pandora's Briefcase (May 2010). As Gladwell comments, "the proprietary kind of information that spies purvey is so much riskier than the products of rational analysis. Rational inferences can be debated openly and widely. Secrets belong to a small assortment of individuals, and inevitably become hostage to private agendas". Quite so.

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Doctrine

Besides an obsession with security, Wilensky identifies two other unhelpful doctrines that may be embedded in the organizational culture.

• An obsession with facts (naive empiricism). The notion that intelligence should be based on simple facts, uncontaminated by interpretation or agenda. Wilensky attributes this notion to a kind of anti-intellectualism, an antagonism towards ideology or theory, and an exaggerated belief in practical experience.

• An obsession with prediction and probability. The notion that intelligence is trying to establish some degree of certainty about the future, and therefore an emphasis on closed questions (Will China attack Korea? Does Iraq possess WMD?) rather than open questions (What factors may influence China's policy in the region?) Because intelligence analysts can't provide Yes/No answers to these closed questions, they end up being forced to assign probabilities to future events, although these probabilities are fairly meaningless and unhelpful.

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So these are among the factors we'll be looking at when assessing an organization for intelligence. Please contact me if you want to carry out an assessment for your organization.

Puzzles and Mysteries

For my second post inspired by Malcolm Gladwell's latest book "What the Dog Saw, and Other Adventures", I want to turn to the chapter "Open Secrets" (originally published in the New Yorker, Jan 2007).

In his analysis of different kinds of intelligence, Gladwell picks up the distinction between puzzles and mysteries originally proposed by Gregory Treverton. (See Curtis Frye's review of his 2003 book Reshaping National Intelligence for an Age of Information. See also Risks and Riddles, published in the Smithsonian Magazine, June 2007. And see my post on Making Intelligence Relevant.)

A puzzle is characterized by having a definite answer, if we can only find it. A puzzle is difficult only because we don't have enough information. For example, Gladwell and Treverton classify the question "Where is Osama Bin Laden?" as a puzzle. If we knew exactly where Bin Laden was, then this would cease to be a puzzle at all. So the purpose of intelligence here is to get relevant pieces of information that help narrow down the field of search.

A mystery is characterized by ambiguity and uncertainty. For example, the question "What is Osama Bin Laden up to?". There is perhaps no shortage of information here, there may even be too much information, the difficulty is in interpreting the information correctly.

Gladwell uses the distinction to discuss the Enron case. He argues against the popular view that Enron management concealed their dealings, and points out that the information was freely available to those that took the trouble to wade through the documents. In contrast to the Watergate case, which was only revealed because an insider (the famous "Deep Throat") leaked information to Woodward and Bernstein, journalists investigating the Enron case simply downloaded the information they needed from the Enron website. Indeed, several years before Enron fell, a bunch of MBA students had carried out a pretty accurate analysis, based merely on the published accounts. In Gladwell's opinion, Enron therefore counts as a mystery rather than a puzzle.

This is consistent with an assertion made by Harold Wilensky in his 1967 book Organizational Intelligence (which Gladwell has cited elsewhere), that a sophisticated reporter working with open sources may achieve more than an agent working with top-secret information. Wilensky highlights the distorting effects a doctrine of secrecy can have on intelligence: one example in Wilensky's book concerns the possible consequences of an American invasion of Cuba, where reporters read the situation more accurately than the CIA experts.

Dishonest people can create puzzles simply by withholding important information. Enron executives went to prison because their conduct was judged dishonest. Gladwell agrees that Enron was reckless and incompetent, but defends the company and its executives against the charge of concealment. The state of Enron's finances was too complicated even for its own executives to understand; we might imagine that some of the executives consciously took advantage of this complexity, but we could equally imagine that this was a situation that Enron blundered into without any deliberate strategy. Hence the mystery,

Characterizing Enron as a mystery also goes some way to explaining why the auditors were useless in detecting the fraud - if it was indeed a fraud. The audit process is designed to spot errors and omissions in the financial accounts, which might indicate dodgy dealings somewhere in the organization. The audit process is not designed to spot excessive complexity or risk, and auditors do not generally practice the kind of ratio analysis that the MBA students used. (Auditing is therefore one of those "best practices" whose flaws are exposed by complexity.)

Another lens through which the Enron accounts could reasonably have been viewed was the taxation lens. The fact that Enron wasn't paying much corporation tax (in several years it paid no income tax at all) might have been seen as an important clue to its lack of real profitability. However, those who wanted to believe in Enron's profitability could easily convince themselves that the low level of tax payments represented clever tax avoidance - in other words, interpreting it as evidence of the smartness of the accountants and/or the stupidity of the tax authorities. (Thus the accountancy lens was used to discredit alternative lenses that might have revealed alternative truths.)

Another way of thinking about the difference between puzzles and mysteries is that puzzles are about people (deliberate conspiracies) while mysteries are about systems. As Gladwell tells the story, Enron wasn't about a handful of bad people misleading everyone else, it was about a system that led everyone astray. Working out a mystery is not a question of collecting more information, but about finding a frame or lens for systematic analysis, to make sense of the information we already have.

Does it make sense to divide intelligence problems into puzzles and mysteries, as Treverton and Gladwell do? I'm not convinced there is a simple either/or, but I'm not sure that's what Treverton and Gladwell are claiming anyway. I  think what is important here is not to identify which problems count as puzzles and which ones count as mysteries, but to acknowledge that at least some problems do count as mysteries in Treverton's terminology, and therefore we need an intelligence capability that helps us to make sense of too much information, and not rely solely on an intelligence capability that merely gathers more information in the hope of resolving something. Examples of this need can be found both in national security and in business.

In terms of organizational intelligence, this means achieving a good balance between two capabilities - the information gathering capability (Perception) and the analysis capability (Sense-Making) - and linking effectively into the remaining capabilities (Decision, Action, Learning). Sometimes merely collecting more information doesn't help solve the problem, especially if we don't have the capacity to interpret the information we already have, or if the new information merely provides an excuse for further procrastination.

(This is similar to the point some of us were discussing recently on Twitter: whether it is always good to produce more ideas, or whether it is sometimes possible to have too many ideas, especially if you don't have the capacity to use them effectively.)

Was Enron intelligent? Enron certainly did some clever and innovative things, but the spectacular failure of Enron suggests that there were some flaws in the thinking. Here are two suggestions. Firstly, a collective failure within Enron to appreciate the scale of its exposure to risk indicates a weakness in sense-making - an insufficiently robust way of seeing beyond the complexity of the accounts and understanding the true financial state of the company. And secondly, a collective refusal to learn from the voices of doubt coming from external critics. When a company is convinced by its own cleverness, this conviction can become a barrier to learning, and therefore a limitation of true intelligence.

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Other examples of the puzzle/mystery dichotomy

• Bob Rosner (ABC News Feb 2007) suggests that puzzles are left-brain and mysteries are right-brain
• Larry Ferlazzo suggests that puzzles are data-driven and mysteries are data-informed
• Security blogger Gunnar Peterson suggests that Authorization is a Puzzle, Authentication is a Mystery
• The Moonrider blog looks at accidents versus collisions in Motorcycle Safety
  
• Brett Miller quotes Gary Kasparov on Life versus Chess: Uncertainty is far more challenging
• In the 1950s, Frederik Buytendijk described men as puzzles and women as mysteries (via Annemarie Mol).
  

Related posts: Connecting the Dots, Explaining Enron, Making Intelligence Relevant

Trust tips

originally posted by John

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As overworked clichés go, the tip of the iceberg is just the tip of the iceberg. Think of a topic, any topic, and the chances are that it’ll have an iceberg attached and its iceberg will have a tip. In terms of the trust space the tips of icebergs tend to congregate down towards the bottom left-hand corner where trust is highly conditional.

While the trust implications of clichés are fascinating and have kept me spellbound for more years than I care to remember, the trust implications of icebergs are quite something else. By definition they’re sinister, just as anything hidden is sinister. And the bigger the berg, the more sinister it is. The more sinister it is, the less the possibility of trust.

Some icebergs, although their precise extent is unknown, are nevertheless known to exist - the NHS computer system, Wembley Stadium, AIDS, climate change, WMD, ID cards, nuclear power stations, as I say, pick a topic – and the more we know of them, the less sinister they become.

Most sinister of all is the tip of the tip of an iceberg that we’re not even supposed to know about – the hint that something is happening that is so secret that even the merest knowledge of it compromises it. This particular tip of an iceberg costs US taxpayers $6bn a year simply to classify secrets - and the US government created 15 million secrets in 2004 alone. So that’s a six billion dollar industry, extending across forty-one agencies, classifying forty thousand secrets every day. Secrets that in their turn consume upwards of ten times that amount and generate ever more secrets in doing so.

Wow, some tip, some iceberg. Oh, and these figures - taken from a US Information Security Oversight Office report - do not include the CIA, the biggest iceberg in this ocean of secrecy, information on which, the report stated, ‘that agency classified’. How sinister might that iceberg be then?

Entitled to trust

originally posted by John

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My contention is that Aidan and Richard would do a better job of examining whatever trust relationship exists between the political process and the country’s ‘intelligence’ services than the Butler inquiry ever will. There are a million and one reasons why they’ll never get the chance to do this better job of course and all of them are to do with publicness.


In the sense that James P Carse uses the term in his book Finite and infinite games, Aidan and Richard have no ‘title’. Titles, Carse reckons, arise from past triumphs and as a result ‘There are precise ways in which one may no longer compete with (for example) the Dalai Lama or the Heavyweight Champion of the World’. Or, one might add, a former Cabinet Secretary and MI6. Publicness is itself a bullet-proof title with which one may not compete and for which, as a result, the notion of ‘conflict of interest’ cannot possibly exist.


According to Carse, titles – captain, sir, lord, professor, your excellency etc – signal not only a mode of address but also a manner of address – saluting, averting the eyes, bowing, respectful silence etc. Worst of all for trust in this specific instance and for its wider implications, titles signal a content of address – only certain subjects are suitable for discussion with an archbishop, an admiral or an inquiry judge who is a former Cabinet Secretary. Titles are the public face of publicness.


The idea that a process that readily gives rise to misleading intelligence (leading to the illegal invasion of a foreign country) is itself too important to have its secrets revealed for fear of destroying our trust in it is an irony that publicness has absolutely no difficulty swallowing. Publicness will swallow anything. In the end it feeds off itself.