In management it is not uncommon to distill complex world issues into oversimplified formulas and matrix graphs, which can be used to communicate confidence that complexity is under control. Common examples include GE Matrix, Ansoff Matrix, PEST, SWOT, and the BCG matrix. So successful are some of these formulas that they grow well beyond their original scope, as exemplified by the infamous Gaussian Copula Function.
What has been missing up to now is a formula or matrix for how to handle unknowns. Even a small commercial operation has significant unknowns, so imagine the sort of unknowns faced by managers of one of the world’s largest armies. Or Wall Street. Hereby I present the Rumsfeld Matrix:
”Reports that say that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns — the ones we don’t know we don’t know.”
~February 12 2002, US Defense Secretary Donald Rumsfeld.