 So now that I got all that nonsense out of the way our next speaker is Professor Ian Angel He is lovingly regarded and called the angel of death and misery by the press Oh doom. I'm sorry the angel of doom. Well, I just gave you a new nickname Everybody here has nicknames and handles so that that's yours Professor Angel is going to talk to us today about Risk and how uncertainty plays in and that the flip side of risk is opportunity So without further ado professor Ian Angel well, good morning everyone and I'm going to start by asking a question which Usually never occurs to an audience of technologists. Why do you use technology? Well, whether you realize it or not the reason is the technology imposes structure on our actions and That gives us a tenuous handle on uncertainty What we're doing is swapping hopelessness for the optimism of a plan of action She uncertainty is then transferred into risk and risk is a heady mix of Hazard and opportunity most people use the term risk and they actually mean hazard, you know risk is actually both hazard and opportunity But today as the angel of doom. I'm going to stick to the dark side Whenever I smell flowers, I think funeral So I want to question the prevalent so-called scientific notion of uncertainty And show that today's widespread perception of risk is thoroughly flawed Many so-called risk managers who have played paid obscene sums of money Don't understand this just think how best turns managed uncertainty and Just imagine that Enron used to run the management of risk consultancy. I Was once at a commercial conference called managing uncertainty. I Shared the stage with the statistician. He droned on About distributions and expectations. I sat there thinking Method is the first the last the only resort of the mediocre Because the business audience founded inspiring stuff Within five minutes the eyes were beginning to glaze over After ten minutes. He had an audience of one me. I was on the stage. I had to listen to the rubbish But then what did I expect a statistician is someone who wants to work with numbers But doesn't have the personality to be an accountant You see statisticians actually believe in the average human being and The average human being has one tit and one testicle Anyway, it was my turn. I Walked over to the podium and I stood there and I shook I stood there And I stood there and I shook and I looked frantic glances at the audience At first there was silence then a few mermas of concern then a growing rumble The chairman got out of his seat and he was halfway across the stage and I went That's uncertainty. It's got nothing to do with statistics Business is full of bastards like me pulling stents Computerization is full of bastards like you pulling stents you see Technology is intrinsically singular. It cannot deal with the singularities that emerged spontaneously when it mixes with human activity systems life is like a poker game There's a lot of bluffing going on and players who bet their shirt on the sadistic Distribution of the cards are going to lose their shirts now I've learned to play this game like my cat Oscar now Oscar is a very special cat because he can talk Some friends came visiting recently and and when I told them that Oscar could talk They bet me a ten to one ten to one that he couldn't So I called Oscar over Didn't say a word Furious so they took my money and left there's no fish for you tonight and then in a very superior voice because Oscar is a very superior cat. He said Call yourself a professor Tomorrow night. We'll get 100 to one So you must look beyond statistics beyond the functionality of technology beyond the good intentions of designers beyond the good and the evil towards the observable Consequential risks that occur when computers are integrated into human activity systems According to a very distinguished professor a colleague of mine Charles Goodheart says any observed Regularity will tend to collapse once pressure is placed upon it for control purposes And observed regularity is an effect But the moment you measure it and you use that measure as the basis of control You are making the false assumption that the regularity is the cause of your observation Putting it in other words Economics is a load of bollocks What Charles is saying is you cannot mix up cause and effect You see a good technology platform Although necessary is not sufficient for success Success and failure is determined by unique political social organizational and particularly personal factors not just the fun the not just the Functional computerization is a Prisoner of societal and personal consequences. It cannot be controlled no matter what the management regime. You see Computers are useless. They only give you answers Usually the problems you haven't asked Success and failure is something else and talking about questions and answers NASA astronaut Mike Collins was asked what went through his mind that blast off and he said I'm sitting on top of six million parts all made by the lowest bidder You see we may know the price of technology But the cost accrues from here to eternity We have no way of calculating the total cost because we do not comprehend the Consequences of using that technology and your part of the problem of not being able to comprehend the total cost Even if a technology is simple it becomes highly complex the moment anybody touches it Grand schemes may solve the problem as intended only to create worse problems any technology Even seemingly benign Can bite Consider the devoted fan of Ella Fitzgerald Fred His last wish before he died was for Ella to sing Every time we say goodbye as the coffin went into the incinerator The record was placed on the turntable the stylus was held over the fourth track But the fool who put the record on the turntable didn't use side to he used side one What do you think accompanied the coffin into the flames? It's too darn hot Now I wanted to play those songs 42 seconds of them, but ask cap wanted $400 for the pleasure so I told them to piss off and think about poor Fred It's just as well He was cremated because if he'd be buried he'd be rotating in his grave at that had $400 You see with computers you too can get burned Systems misbehaved grand schemes may solve the problem exactly as intended, but they create worse problems You see people bandied the word system around without the slightest understanding of what it means Everywhere the term system is used when people actually are referring to installations a system is what the installation becomes After you have been messing with it It's what it will become not what it is intended to be Installations are linear Systems are intrinsically nonlinear in a linear world the consequences of an action stop with a reaction in a nonlinear world of practice and foreseen consequences so-called systemic risks both hazards and Opportunities feedback as the result of inevitable complexity with the interactions implicit in all large systems When solving a particular problem you may or may not succeed, but what is certain? Something completely unexpected is going to happen There was a farmer in north wales farmer Jones He grew so sick and tired of RAF fighter planes screaming over his farm Terrifying the stock that he painted piss-off biggles on a farm roof Words bred like wildfire among the fly boys The noise pollution actually got worse as all the RAF pilots from all around the country came to see and Then they told their US Air Force colleagues, and they came along as well So that's what the consequences of your action another example The UK office of government commerce spent 14,000 on a new corporate logo for its website They've mouse mats pens etc according to a spokesman the OGC is an Organization that is looking to take a firm grip on government spend That's not all they took a grip on when human in human activity systems mix with Computer systems results are perverse when you use the tools of technology Any technology to solve a problem you may or may not succeed But what is certain the most amazing things happen if you leave that job to a computer? The complexity increases to a point where utility becomes reliance Reliance becomes dependence and the law of diminishing returns Precipitates a galloping descent into nightmare welcome to the twilight zone and the management of information systems preposterous claims are made in the early days of every technology in his pioneering days Electricity was claimed to have therapeutic effects small electric shocks were thought to continue to cure consumption dysentery cancer blindness worms impotence Just like the Heidelberg belt the sort of chastity belt with electrodes Apparently small electric shocks to the nether regions could increase sexual potency Of course, we aren't that stupid. Well, no What was the dot-com bubble but computerized idiocy? Let's face it Most dot-coms were just mail order with delusions of grandeur a fast access into a shambles and even the reputable companies were far from perfect For his 80th birthday Fred Harrop from Yorkshire Had friends who ordered him a book on Chechilia Bartoli the famous opera diva and At the party they opened up the wrapping and presented him a book that contained some very explicit not to say pornographic images 80-year-old Fred was upset and so his friends phoned up Amazon and said Fred is Disappointed very disappointed and the man from Amazon said Fred's disappointed think about the guy who got the opera book Social networks of so-called web 2.0 can lead to similar lunacy recently Dylan Osborne joined Facebook looking for kickstart to his love life after he'd just been divorced as Usual the site sent an automatic friend request out to everyone on his email address book Unfortunately that included his ex-wife who had previously taken out a court injunction at banning him from contacting her Although the message was sent without his knowledge Dylan spent three days in jail before his lawyer got him out She only after the nonsense stops can technology be used propitiously to its full potential President Pompidou was right. There are three roads to ruin women gambling and technology women the most pleasurable Gambling the quickest the technology is the most certain So will technology lead to ruin? Well, who knows we're damned if we do but we're doubly damned if we don't Take the advice of Machiavelli on his deathbed the priest was delivering the last rights Do you renounce the devil and all his works to which Machiavelli replied? This is no time to be making enemies You cannot make an enemy of this diabolical technology Become complacent and computers will really screw you up along with all the surrounding human activity systems Consider Mike Sodden the now ex CEO of the Bank of Ireland He outsourced his IT department the same disgruntled ex-employees who had lost their benefits as bank employees Was still servicing the banks computers? Out of the blue the press leaked a story that Sodden had been surfing some rather unsavory webs escort sites in Las Vegas Prior to a business trip. He was forced to resign now who could have possibly told the press in The good old days before Sarbanes Oxley those in positions of authority in the firm had limited Responsibility and little or no liability They could be highly imaginative with the company's books because they had little or no liability Nowadays when the CEO signs off the accounts sleepness nights beckon Because a jail sentence beckons Their personal freedom is now at risk and this focuses the mind of every board of directors They all saw Jeff skilling of Enron being carted off to jail in handcuffs No wonder computer security now grabs their attention now It's personal now. It's serious who knows what incriminating Documents will pop out of the computer in the present financial situation Around budget time smiling see chief security officers can be heard quoting that great American philosopher Richard Nixon When you've got them by the balls their hearts and minds will follow So never put anything on a computer that you wouldn't want the whole world to see because the world will see it Potential employers are scanning the web to check out job applicants HR departments are uncovering incriminating evidence posted long ago on social networks This loyal comments of past employers or the release of their confidential information Even the use of inappropriate screen names or sloppy or lewd vocabulary Even a poor writing style can all lead to a rejection slip and as for emails I always tell my students use them as a defensive weapon The buck doesn't stop here with authority. It stops anywhere Authority can dump it Noted so never take a verbal statement on its face value Note it down. Email it straight back Asking for clarification now it's on the record now you've proof that wrongdoing lies elsewhere Ensure that all commitments all agreements are conditional Forget the business school lie that companies are full of rational people with unified aims Take a reality check Many managers are liars cheats fools incompetence psychopaths All with their own agendas just ask Dilbert Always view the organizational chart like a monkey puzzle tree Those at the top look down and see monkeys Those at the bottom look up and see arseholes So practice the art of plausible Deniability in your emails Set up audit rails to cover your tracks and backs because when blame is flying around That's exactly what the other guy is doing and the poor sap at the end of the audit trail is the guy That's going to get shafted And to think not very long ago Computer applications were seen as groundbreaking Fundamentally changing the nature of work Signalling the advent of the information revolution Unfortunately every revolution evaporates and leaves behind only the slime of a new bureaucracy The real problem of course isn't computerized bureaucracy per se But it's expansion into inappropriate areas quite reasonably Therms aspire to bureaucracy as it is the most effective way of controlling normal problematic situations and that way mitigating the hazard However in singular situations the unilateral imposition or predetermined rules of a bureaucracy Will always lead to chaos. This is what happened at Wookiee Hole Now Wookiee Hole is a famous tourist center in England. If any of you go to England I can recommend it's a great day out for you and the kids Anyway, Wookiee Hole were launching a new attraction a grand teddy bear exhibition But their insurance company had a different idea They insisted that the premises be controlled at night by a guard dog. A lone guard wasn't enough You see they done a risk-based analysis sent somebody around with a clipboard and He told them you have to have a guard dog to protect this valuable collection left with no choice The management hired Barney the doberman So far so good Except for a very simple oversight When dog handlers train dobermans they use fluffy toys for the attack The presence of a mountain of fluffy toys Was too much for poor old Barney It turned a normal situation into a singularity Mabel the show star exhibit a steif bear Once owned by Elvis Presley, you know, he sang to it teddy bear It didn't stand a chance Barney tore it the shreds along with all the other bears The insurance company had to pay out 40 grand 40,000 pounds at $80,000 just for Mabel alone and All because the risk assessors in their bureaucratic certainty demanded a guard dog Computerized bureaucracy too can degenerate into chaos the American Psychological Association Says the omnipresent computer Screens distract and cause confusion and errors of judgment They call it the glass cockpit syndrome. No one is immune from the novice user To the most sophisticated computer professionals and you the hackers don't get too smug this syndrome has two effects end users rely entirely on the system without exercising any judgment and the ensuing information Overload results in them ignoring many pieces of sometimes very important information Computerized bureaucracy is highly efficient and effective in Normal situations, however, we cannot know if a situation is normal until after all the Consequences have played out and the inappropriate use of bureaucracy can be mitigated but only by using discretion human discretion and fortunately bureaucracy singles signals the end of discretion in most Organizations discretion is frowned on because bureaucracy in itself referential certainty Claims that everything is normal and Under control via the rules However in the inevitable abnormal situations a lack of discretion leads to a vicious circle of hazard You see bureaucracy are self referential systems They operate on their own terms in a bureaucracy all decisions and choices have been made in advance With each situation seen to be normal along with the self referential insistence that there are no abnormal situations But there are always unique singular situations you cause many of them and these don't fit the rules and yet we tend to admit and Tend to accept what we are told by the computer screen Rather than admit to the contradictory evidence of our own eyes Now you may be wondering if I believe all this Why do I teach my students about computerized methods? Well, I say for very much the same reason that medical professors teach their students about venereal disease. I Tell them That firms are throwing Telephone number sums into the bottomless money pit of computing that black hole of information technology And they forget Dennis Healy's first law of politics when you're in a hole stop digging I tell them to listen to Moondog the blind New York poet When he says what I say I say now I say without condition that science is but the latest greatest superstition Information technology is just the latest technological adventure Whereby man feels he can subjugate nature by sheer will but New technology owes ecology an apology It's madness Madness is something rare in individuals, but in groups parties people's ages. It is the rule The madness of our particular age is the delusion that our world can be managed by using this pseudo science of computerization This mat is the madness of control freaks behind many of their computer applications is a malignant belief that human thought is mere calculation that we are biological analog computers There is a sin sinister hidden agenda stemming from the dominance of two ideas That a number can be a meaningful representation of human experience and that arithmetic operations on such representations Implemented on a computer can produce rational decisions About and that they can control the human condition absolute nonsense The resulting brave new world will not be one of ordered constrained and controlled lives, but a rule-based bureaucratic shambles What the control freaks don't appreciate is that their actions actually trigger an uncertainty principle There's no point in measuring something that will change the moment. It's measured even because it's being measured Just like in Britain in the in the hospitals Surgeons now push dying patients out into the corridor to minimize their death in surgery figures That's what happens Pointing mathematical instruments at the complexity in a nonlinear world can only create instability Like the idiots who think they can intercept hacking with statistical techniques hackers are singularities And statistics will never intercept a singularity except by accident So Pointing instruments mathematics at the complexity in a nonlinear world of practice can only create Instability where the only certainty is uncertainty Take the personalization Technology of profiling Everywhere it's being used to predict for example the tastes of consumers by tracking what they buy watch and listen to Mike Binder the TV star Set his Tivo to record his 1999 movie the sex monster about a man whose wife was a bisexual the TV The Tivo profiled Binder as gay and sent him a steady stream of gay programming He counter-attacked by recording the playboy channel Tivo eventually gave up But Binder's wife was not very happy So do they really imagine that we control our complex world by Computerizing the arbitrary use of numbers statistics measurement with profiling with systems analysis opinion polls market research Source of economic classifications Performance measurements efficiency ordinance cost-benefit analysis. Well the idiots do The basis of decision-making has shifted to a numerical justification and the lust for numbers is spreading Everywhere I see forecasting techniques that are merely the assignment of numbers to the future Strategy becomes a matter of controlling the future by labelling it with numbers rather than by continually Evaluating the uncertain situation and be by relying on people on good people Searching for the right numerical label to represent the future is just no different from astrology Numerology or the personalities tests found in women's magazines, you know fill up 20 questions And you can find out the eye color of your husband to be Computerization is just as stupid and what happens is? Enter the Peter principle Individuals and computers within companies are promoted to the level of their incompetence But worse computers magnify and amplify the incompetence of all around It's easy to forget that numbers are not objective They reflect an act of choice some hidden agenda some pre-judge priority some preconceived notion of category This leads me to another Oscar story You remember him I Commute from work and the railway station is four bus stops away from my home Returning from work last week. I just missed the bus and so I ran after it. It stopped in the distance I was almost there and it took off again So I kept running Stopped in the distance. I almost got there. It took off again Give up and I ran all the way home So I opened the door. I kissed the cat and said hello to my wife and said I Have just run all the way home But the good news is I have saved one pound twenty pence Oscar looked at me Very pathetically and said call yourself a professor Why didn't you chase a taxi you would have saved five pounds? But I can hear you say the figures don't lie Not according to Mark Twain. It's not the figures lying. It's the liars figuring and you've got plenty of those in Washington Ask any manager a blood at budget time. You see numbers are like people Torture them enough and they'll tell you anything Underneath all numerical methods is a belief in atomism in category Category is not truth, but merely a choice that says it's okay to treat singularity as though it's sameness and Then to assume that all comparisons between these data choices are absolute facts But as time moves on or the perspective or the environment changes then category changes The problem is we are trapped because categories are the way that human beings deal with the world However, as category changes meanings change All data is context sensitive and the people who live in databases Fail to understand that all databases are flawed There's no such thing as absolute facts. A fact is like a sack It won't stand up until you put something into it nuances of detail as well as deliberate accidental and arbitrary Actions feedback to continuously modify and amplify elements processes subsystems. So if you squeeze Complex human experience into a straight jacket of cons of categories which are needed for computerization You are forcing square pegs into round holes This sheds a debris of detail that conspires with the context that forms a critical mass and the subsequent explosion often triggered by what you're doing and That explosion comes from the capricious Fragment division and fragmentation in the flux of events that is life What I'm saying is that the only thing systems having common is they all fail The question isn't if it's just when Failure is inevitable and the fault lies not in our stars, but in ourselves That fault is in the way we human beings categorize what we observe in the world now Prepare yourself. This is the heavy bit. This is the bit that comes from the professor the fallacy of Residual category. It won't take more than a couple of minutes then you can wake up again When we categorize when we computerize we separate each thing each entity each item each data object From everything else in other words everything and its complement its residual category So that we can model and thereby control the world with science and technology And by doing this we restrict access to that thing However, according to Nick Nicholas Lumen the concept of the environment should not be Misunderstood as a kind of residual category instead Relationship to the environment is constitutive in system formation What he's saying here is that there are tacit properties in the whole Latencies which are not apparent in any component And when you collect these components together the latencies disappear. They're still out there, but you don't have access to them Any component is still structurally coupled to everything else However, by bringing that one part of the four Observing it as a standalone unit those couplings are cut in your model, but they're not cut in the world The latency has gone in your model. Let me illustrate this with a diagram the Borromean rings These rings are three interlinked circles that because of their topology are inseparable as a triple you can't pull them apart The special characteristic of the ring lies in the fact that no two of them are linked and as a result If you distinguish one of them the red one say and then take it away Suddenly you find the whole thing has fallen apart and that's what you're doing with a database You've lost that latency of the interrelationship Thus structural couplings are made to disappear and the two parts the thing and its residual category No longer comprise the original whole you've lost something and you've introduced asymmetry you've introduced a paradox Because in the original whole the two artificial separated parts continue to operate and interrelate as an unobservable hole and because of this asymmetry between the world as it is and as it's observed and modeled Observation is always conditional, but those conditions are necessarily unobservable unappreciable Uncertain and those truncated structural couplings so casually discarded by observation Stay on as uncertainties and thus as risks to the observer in any further observation and they can result them to reassert themselves in the most inconvenient ways and We are back with uncertainty and risk Hence we are confronted by the most inconvenient fact by introducing structure that turns uncertainty into risk We have distinguished the world into categories and in doing so we introduce paradox and yet more and far more subtle uncertainties which then leads on to further risks and yet more lack of structure This is the human condition and there's no escape Initially the paradoxes are aligned. This is how we saw the pattern in the first place But eventually it all falls apart as the as the system gets bigger as time moves on Everything will falter the paradoxes will conspire and the system will get upset and you're part of the upset You're part of the manipulation of the paradox all computer systems are flawed and can only have a temporary utility This has nothing to do with the quality of design Being smug in your expertise with computer installations is not going to help you Because the floor has got nothing to do with computers It is everything to do with systems and the fallacy implicit in all human observation and categorization all Databases of flawed and if people think they can perfect a database their idiots Placing total faith in computerized systems is asking for trouble like the headmaster of a private school in England Who spent a fortune on a new computing laboratory? Proudly he sent letters out to all the parents Including invoices for the school fees As they were preparing the letter they spent they realized that the word annual was spelt with a single end So what did they do they put it through the tosaurus and find the nearest word to it But of course Nobody ever checks the nearest word and so the letter went out the annual school fee will be One humorous parent wrote back and said it does make a change. We normally pay through the nose The act of imposing Computerized tidiness on an untidy world can lead to chaos a blind belief in perfecting Computer installations is folly taking for example Biometric databases aimed at identifying catching criminals Television programs like CSI in Vegas trumpet the myth of forensic investigators vacuuming up biological material from the scene of the crime comparing DNA samples with a Computerized database and out pops the criminals name end of story Nothing is that simple low-paid hospital staff Will comp will will be compromised to supply samples of blood skin saliva and other biological materials Aspiring criminals while undertaking a crime will randomly scatter arbitrary collections of DNA materials Cigarette ends all over a scene of crime the whole system will be compromised So all of this stuff isn't going to work if you really are annoyed with profiling Don't object to it Somebody here write the crawler give it away free and then when nobody is using the internet They will simply randomly search the internet and then these silly profiling companies will have databases full of garbage And when the advertisers realize this they'll stop paying them and the whole thing will go away So the epistemology underlying large socially engineering databases are misconceived But there's control freaks everywhere who think they can capture the identities of the whole population and for control freaks I mean politicians But like my hero president Reagan he says treat politicians treat the world like a newborn baby They make demands with one end and take no responsibility for what happens at the other These politicians should be changed frequently like diapers for much the same reason because they follow The British government subscribes to the pixie dust school of technology They think computerization is a magic dust that they can sprinkle over problems and something wonderful will happen they It's no surprise of Britain as an appalling track record of Slippage and price overruns these idiot politicians Tony Blair once called our group Technologically inept because we did Criticize what he was doing these idiot politicians are now proposing an ID project one of the biggest it computer installations ever envisaged of course the politicians won't have their photographs on their ID cards Because no one can decide which of their two faces to use They want to computerize register for the whole population which they claim will prevent identity theft and catch terrorists Listen, and you can hear president Reagan again the nine most terrifying words in the English language I'm from the government, and I'm here to help John Lennon John Lennon was right Our society is run by insane people for insane Objectives, I think we are run by maniacs for maniacal ends There's only one way to look at the politician and that's down a Politician will double cross every bridge when he comes to it so it is always there when he needs you Criminals take the money and run politicians run and take the money Parliament is like a bunch of bananas. There's not a straight one among them anyway Now you know why the times calls me the angel of doom and the guardian calls me the guru of gloom But I don't want you to go away thinking that I'm a pessimist Pesimists think the glass is half empty Optimists think the glass is half full I'm a capitalist. They're using too much glass as As a capitalist Everywhere I look I see silver linings among the dark clouds for computer professionals and for hackers like you Of course, there are countless benefits from digital technology But only for those who adhere to sensible pragmatic strategies There's huge money to be made from this vast gravy train But never forget the digital technology is part of the problem not the solution There are no solutions only contingencies Whenever anyone tells you that information is good more information is better and computerized information is best Reach for the straight jacket Only new rottics think that they can use technology to control the uncertainty in the real world When a man has a watch he knows the time if he has two watches he isn't so sure Now for those of you out there Who still haven't recognized the importance of complexity in what you're doing then I have one piece of advice for you Start the day with a smile and get it over with Because you've got nothing to smile about But as for the cynics in the computer security business We'll be laughing all the way to the bank Thank you very much