When we set out to make a decision deliberately, we look for the most defensible reasoning. We move through related causes and effects in sequence, testing one variation against another, and when we judge the alternatives sufficiently explored, we settle on the reasoning we trust most.
Reasoning is always an exercise in probability. We can never identify, with certainty, the right course of action — only the one best supported by what we have. The process is one of elimination: we reduce our choices, and from what remains, we choose.
Our understanding is shaped by the information we can access and the knowledge we develop from it. The best decisions come from the broadest access to information and the strongest commitment to internalising it — building a knowledge base equal to the decisions we have to make.
Lack of knowledge is the greatest constraint on decision-making. It comes from one of three things: complacency, inexperience, or insufficient access to information.
#1 Knowledge vs information
A useful way to think about the relationship between information, knowledge, and decision-making is to picture ourselves at the centre of a circle. Within the circumference is information within our reach.
Some of this information is already assimilated — it has become a part of our knowledge and is immediately useful. The rest is accessible but not yet assimilated: it is still just information, a potential resource, and is not yet useful to us.
Outside the circle is all the information that could be useful but to which we are blind. To bring it inside takes time and energy. The reasoning process always takes place inside the circle; what lies outside must first be acquired. Acquisition is a two-step process — first networking and locating what could be useful, then internalising it through enquiry and study.
#2 What we don't know
What lies outside the circle is vast and boundless. The full context and consequences of a decision are rarely understood at the time it is made; the quality of a decision only begins to reveal itself with the passage of time.
When a decision turns out to be poor, it is either because we made poor use of what was inside the circle, or because we underestimated what was outside of it. Experience matters because it expands the circumference.
Someone with experience has not only a larger circle but a larger network. He has already assimilated more, and he has broader and faster access to what he has not yet assimilated. This gives him a more formidable foundation for future knowledge, and makes him more adaptable.
The environments in which we operate place different demands on us. What we know — and what we do not — matters differently in each.
#3 Information in long-term partnerships
The most efficient environments are those in which information is widely available and actively shared. Such environments are built on partnership, shared advantage, and long-term relationships.
When information is shared positively, success is generally achieved to the benefit of all stakeholders rather than at the expense of some. The optimal performance of each, made possible by the optimal availability of information to all, in turn drives the whole forward.
Such environments also place an additional burden on their participants, qualifying them by their ability to transform information into operating knowledge. When information has been prepared and shared at considerable expense, its assimilation and use is implied — it is not given to be ignored.
A network built to make information available is always the product of active effort. Its purpose is to create and share advantages, and it puts a high premium on the link between knowledge and performance.
#4 Information in a segregated environment
There are other environments where services and transactions rest on informational advantages held by one party at the expense of others. In some cases these advantages are the product of long-term diligence; in others they rest on preferential status — preferential access to information, preferential access to decision-makers, or preferential licensing arrangements — all of which are anti-competitive to a greater or lesser degree.
Information or knowledge held in confidence over long periods creates inefficiencies. Sectors with high barriers to entry sustain those barriers through informational exclusivity, and they perpetuate further inefficiencies in the defence of their secrets.
When information is withheld, it usually spawns an architecture to defend its preferential status. Exclusivity is self-reinforcing: it generates further information — misinformation — in defence of its position. The most effective defence of withheld information is misinformation, the nature of which is to deflect enquiry through subversion and distraction.
The paradox of this environment is that confusion veils clarity. The best way to protect informational advantage is to build a shield out of its opposite. Logic and clear argument fail in an environment of misinformation, because the very principles on which they rely have been undermined.
#5 Information in complex environments
The more entities participating, the greater the scope of a project and the greater the urgency, the greater the complexity. Large-scale work is generally done by an aggregate of specialists. The more knowledge and depth that accrue to each component part, the more complex the informational environment becomes.
Each part, whether a service or a physical component, must be validated within the context of the whole to ensure it performs as intended. When many specialists are brought together and their deliveries coordinated, several factors combine to drive complexity.
First, the delivery process of each part varies. Trajectories differ, and coordination requires the timely and voluntary sharing of information.
Second, the quality and depth of relationships vary. Some participants are well-established within the functional whole; others operate at a distance. Ensuring that critical information reaches everyone who needs it requires synchronisation and discipline.
Third, each part operates with a different vocabulary — its own acronyms, performance measures, and reporting conventions. Cultures of communication also differ; some participants are proactive, others reactive, and rhythms and cycles vary.
Even with the strongest alignment on common objectives, a complex environment runs up against many limits. A controlling entity can preserve cohesion through active effort; ongoing communication to highlight risks and raise flags improves integrity. But every additional control adds further complexity of its own.
In complex environments, cohesion is always eroding, and integrity is always on the way out. Only continuous, active commitment can reset and reaffirm the core objectives, and keep the narrow critical path open.
#6 Information and power
Where information and knowledge are used to create influence, we are witnessing an expression of power. Power uses information and knowledge to create attraction, and the force of attraction is then used to propel and build momentum in a given direction.
The fundamental difference between this and a segregated environment is that the advantages contribute toward shared momentum and direction, rather than accruing only to a preferred group. The essence of power — the inner process of turning information into knowledge — is still proprietary. The difference is that the expression of power is openly shared, while in a segregated environment the product is actively concealed.
The importance of examining the relationship of knowledge to power is to understand the nature of attraction. Power is the actuation of a magnetic principle: when people follow, it is because they are drawn to an idea.
The highest form of power is the ability of a leader to focus his energies on common interest. His knowledge of people's needs — both individual and collective — gives him the ability to address and embody them. In this way, power is the attention given to the needs of others. It is both the knowledge of those needs and the knowledge to mobilise people in pursuit of them.
Power is the ability to move people toward the fulfilment of their own desires and interests through the fulfilment of a common interest. Knowledge is the foundation of this power.
The search for information and the acquisition of knowledge are the infrastructure on which all cultural, commercial, and government institutions are built. In examining the ways in which information and knowledge are used, we increase our ability to understand the environments we operate in, and to act more deliberately within them.