Seeking Knowledge, Embracing Uncertainty
Leveraging Greek and Vedic tools of Epistemology for Better Business Decisions
When we state something in good faith, we typically try to communicate what we know to be true.
How do we know that what we know is the truth?
It's a recursive contemplation and nothing I thought of till very recently. Nowadays, since I am writing for an audience, especially with an intention to clarify for oneself inspired by the Feynman Method; this becomes an important question. I talked about this in a LinkedIn post a few months ago entitled, “Why I Write”.
This is a core consideration in Epistemology, a branch of philosophy that is focussed on “the theory of knowledge, especially with regard to its methods, validity, and scope. It is the investigation of what distinguishes justified belief from opinion.”
As regular readers know, I have been reading the ancient Indian schools of philosophy that take their basis from ancient texts called the Vedas and also the systems that emanated in ancient Greece more than 2025 years ago. I have only been focussed on the Yoga philosophy and by association on Samkhya and Vedanta in my readings so far, with an occasional reference to Nyaya. The Greek Schools form the basis of much thinking in the modern western world and they affect our thinking unconsciously due to inadvertent exposure to derivatives every day. I have been consciously reading Stoicism with some reference to Cynicism and Skepticism. Through my readings thus far (which are diminutive compared to the vast corpus that exists), I picked up on a well defined set of epistemological tools that are used to establish knowledge or truth. This insight builds upon my training as an engineer where the “Scientific Method” forms a core basis of understanding.
Vedic Schools with brief descriptions are as follows. Samkhya: One of the oldest philosophies, founded by the sage Kapila. It is a dualistic system that makes a clear distinction between Purusha (pure consciousness) and Prakriti (primordial matter). It seeks liberation through the realization of the separateness of Purusha from Prakriti. Yoga: Closely related to Samkhya, the Yoga school was systematized by Patanjali in the Yoga Sutras. It prescribes an eight-fold path (ashtanga yoga) involving ethical disciplines, physical postures, breath control, and meditation techniques to achieve unity of the individual self with the Divine. Yoga is a philosophy that relies on Samkhya for its metaphysical basis. Nyaya: Founded by Aksapada Gautama, it focuses on logic, epistemology and methodology for acquiring valid knowledge. It identifies four means of knowledge (pramanas) - perception, inference, comparison, and testimony. It developed a robust system of logic and argumentation. Vaisheshika: Closely linked to Nyaya, founded by Sage Kanada. It is an atomistic pluralistic system that analyzes the nature of reality in terms of indestructible atoms (anu) and their interactions. It classifies all objects of experience into six categories (padarthas). Mimamsa: Founded by Jaimini, it focuses on the exegesis and interpretation of the Vedic texts, particularly the Karma Kanda (ritualistic injunctions). It accepts the authority of the Vedas and uses logic and reasoning to understand their meaning and implications. Vedanta: Literally "the end of the Vedas", it is based on the teachings of the Upanishads and the Brahma Sutras. It explores the nature of Brahman (ultimate reality), Atman (the self), and their relationship. Key sub-schools are Advaita (non-dualism), Vishishtadvaita (qualified non-dualism) and Dvaita (dualism). The Greek Schools I read about are as follows. Stoics: Founded by Zeno of Citium, they believed in living virtuously in accordance with nature and reason. Key ideas include cosmopolitanism, rationality, self-control, and acceptance of fate. Cynics: Founded by Antisthenes, they rejected conventional material desires and social norms, instead advocating a life of virtue and self-sufficiency in line with nature. Skeptics: Represented by Pyrrho and later Sextus Empiricus, they questioned the possibility of attaining certain knowledge and advocated suspending judgment on philosophical matters due to the inadequacy of human senses and reason. Epicureans: Founded by Epicurus, they pursued a life of pleasure and freedom from fear and anxiety through understanding the workings of the world and limiting desires. They believed in the pursuit of tranquil pleasure through virtuous living.
Simultaneously, as I invest, consult, advise and pursue technical work, this insight has started to help me formulate conclusions that are more reliable. At the very least, I am now able to readily and explicitly distinguish in my mind what I believe as fact, opinion or belief/conjecture. I will share a bit in this essay.
First, it is not my intention to give a fulsome description of these philosophies and the specific epistemological tools. I am uniquely unqualified to do so. However, at a high level and using common understanding I can apply the concepts to modern thinking. If you're interested, there is a gargantuan amount of reference material easily available for you to pursue on your own.
At the highest level the various tools accepted by these schools were as follows. Vedic Schools, referred to their accepted epistemological tools as “Pramanas” (proofs): Pratyaksha (Perception): Direct sensory experience or empirical observation. Accepted by all Vedic schools. Anumana (Inference): Deductive reasoning based on premises. Accepted by all Vedic schools. Upamana (Analogy): Drawing knowledge through comparisons and analogies. Used by Nyaya and Vaisheshika philosophers. Sabda (Testimony): Knowledge derived from reliable sources, scriptures or trustworthy individuals. Accepted by Yoga, Nyaya, Vaisheshika, Mimamsa, and Vedanta. Arthapatti (Postulation): Deriving a conclusion based on circumstances and implications. Used by followers of Mimamsa. Anupalabdhi (Non-Apprehension): Negative proof or deriving knowledge from the absence of something. Mimamsa and to some extent Nyaya. Greek Schools: Aisthēsis (Perception): Knowledge acquired through the senses. The Stoics, Epicureans, and some Skeptics accepted this. Sullogismos (Deduction): Logical reasoning through deductive arguments. Accepted by the Stoics, Epicureans, and some Skeptics. Epagōgē (Induction): Drawing general conclusions from specific instances. Used by Aristotle and others. Sunkatathesis (Assent): Giving assent or approval to impressions as a criterion of truth. The Skeptics emphasized this as a criterion for knowledge.
It is apparent to even the most casual of observers that there are parallels and similarities. It's not important to know whether the Vedic scholars of ancient India, especially the Sankhya school might have affected how the Greek Scholars thought. What is important is that across these ancient schools of philosophy the methods to establish true knowledge are similar and aligned. Further, in a straight line, a subset of these methods form the basis of the scientific method.
But, we live in the age of the “Influencer”, “Creators” and “Content Marketing”. Social media and corporate disseminators of information saturate with spin and bias the inputs we receive everyday. In some businesses, the message and presentation of information supersedes the understanding of the truth. And then there is GenAI. We can take it for granted that regurgitated ideas from training data, with mechanical model generated prose will significantly overwhelm original thinking and content in what we consume everyday.
Given the chaos and the (dis)information overload here is how I have started thinking about these epistemological tools in my daily practices and how I think companies can use them to drive better outcomes. For this essay, I have zoned in on six.
I start with the notion of embracing multiple perspectives, the importance of which was clearly recognized by both the Vedic and the Greek traditions. This is often repeated in management literature but seldom practiced in its purest sense. You can see in my earliest essays, I would explicitly seek our counterpoints to my main thesis. It forced me to consider alternatives to my opinion or conclusions, which then allowed me to question my own assumptions. This changed how I valued my own opinion.
In my investments or advisory work, it is important that my work for my client gets to “the” truth as best as possible or establish the limits of it. Upon doing so, the strategy and tactics that are formulated will have a higher chance of success. In my projects during the discovery stage I have made it a point to ask for opinions from as many references as I can; experts, practitioners and when it exists, documentation. I also, at appropriate times, share my own opinion clearly presented as such expecting reaction to form further understanding. In studying successful strategies it is commonplace to notice references acknowledging and incorporating various stakeholder viewpoints, drawing from perception, inference, testimony, and other relevant means of knowledge.
Unfortunately, we also see the reverse tendency in many instances, for example as is being reported about Boeing, to discount and even ignore contrary viewpoints or information. I’ve read about practices in companies like Amazon where disagreement is encouraged. For example, a decision maker is expected to write a two page memo when disagreeing with an idea versus accepting it at face value for further investigation. “Disagree and commit" is apparently the adage there. I don't know if this remains true and how assiduously it is practiced, but we all know of companies that serve as examples where politics or imperfect management discourages such such intentions. Or worse, where organizations copy the “rituals” of the epistemological tool but never pick up the causal intention. Hate to break it to you, but “a two page memo” by itself isn't a magical device.
My natural tendency is to ascribe to rigorous logic and reasoning, unsurprising given my long history in technology and my training as an engineer. The emphasis on reason, logic, and argumentation in the Vedic schools (e.g., Nyaya) and Greek traditions (e.g., Stoics) is integral to my approach towards work and life. It's easy to see how these approaches can inform corporate decision-making processes. In our respective careers we are bound to have seen numerous examples where companies develop robust frameworks for evaluating premises, drawing valid inferences, and subjecting proposals to rigorous logical scrutiny. Every time I encounter a startup or a fund that exhibits these behaviors, I try to find a way to invest or get involved or both.
Embarrassingly this is also how I do most things in my life! I find myself doing “if-then” loops in my head while doing laundry, during a Costco run, gardening, anything really!
In any consulting or advisory work I undertake, projects that require this type of deduction give me the most satisfaction. In a recent piece of work for a PE firm, the work involved validating an investment thesis and a business case for a company they were interested in acquiring. Through this work, which I've been involved with off and on for a while now, I realized that this method of reasoning, canonized so long ago, is a core discipline for the PE and the Hedge Fund industry and what makes them immensely succesfull.
Closely related to the unemotional and cold hard logic (remember Mr. Spock!) is to let creativity flow by embracing analogical reasoning, which can provide new ideas and possibilities to which logic and reasoning can be applied. The concept of Upamana (analogy) in the Vedic schools and the use of analogies in Greek philosophy can aid in corporate problem-solving and innovation. I’ve worked in Telecommunications, Professional Services, Digital Businesses, e-Commerce, Retail, Healthcare and Information Services giving me first hand experience of this phenomenon. This journey has taught me to not only see patterns of applicability across domains but to also understand the bulwark of financial models that underlie all commercial enterprise. Here’s an example. The travel distribution industry taught me the value of sharing content (travel products, availability, pricing) through APIs for transactions across an ecosystem. Years later while working in Retail, my team and I built an API to connect services/content available in a physical store for use by third party App Developers yielding outstanding commercial outcomes.
Corporations can draw insights and inspiration from analogies across different domains, fostering creative thinking and the transfer of ideas; but even today, I see reluctance to bring in talent with non incumbent viewpoints and to support them in an unfamiliar context. Many leaders are succumbing to the default option of hiring from within the industry, cutting off sources of inspiration that can be had from analogical reasoning which startups revel in!
It is not my natural inclination to question assumptions and challenge beliefs. It is probably the ancient Skeptic in me who is unsure whether anyone can have “certain knowledge”, especially me. However, over time I have accepted that the spirit of questioning does not necessarily insult established beliefs and assumptions. On the contrary, as embodied by both traditions, it can foster a culture of critical thinking and continuous improvement as long as it can manifest in a mindset that can drive radically better outcomes. There is a large amount of research that shows companies with “Growth Mindsets” can significantly outperform their competition. Carol Dweck, a psychology professor at Stanford wrote the book, Mindset, published in 2006, which has sold more than 800,000 copies, and the concept of a growth mindset has come to permeate fields such as education and sports training. Since then she has extended her work beyond individuals, to organizations. In an HBR article about this concept, we find this nugget - “For instance, employees at companies with a fixed mindset often said that just a small handful of “star” workers were highly valued. The employees who reported this were less committed than employees at growth-mindset companies and didn’t think the company had their back. They worried about failing and so pursued fewer innovative projects. They regularly kept secrets, cut corners, and cheated to try to get ahead.”
As an entrepreneur, it is imperative to ensure we are building a culture on the basis of a growth mindset and actively negating symptoms of a fixed mindset. In startups a growth mindset provides at least four blessings; it allows them to move into new fields as needed, fosters resilience, allows for product iteration and most importantly it keeps everyone humble. I’ve come to realize that corporations are definitely not designed to function like startups, in fact in many ways they are designed to be the opposite, structured to avoid risk and to be predictable. However, we all also know that in being this way, they are by design vulnerable to disruptors and must maintain an entrepreneurial edge to ward off interlopers. Many mitigate the risk by being acquirers of innovation, others are organic innovators. Organic innovators encourage employees to challenge conventional wisdom, identify potential biases, and explore alternative perspectives, leading to innovation and adaptability.
Upholding ethical principles should seem obvious but it is clearly a tool that has lost its effectiveness in the modern workplace.
Before I dive in I want to apologize to my friends and several subscribers here who work at marquee consulting firms, especially McKinsey. I am going to use them as an example of how knowledge is imperfect unless it also includes ethical and moral principles. McKinsey isn't alone in this matter, in fact I could have chosen amongst scores of examples.
Its easy to find examples of a widespread malaise where ethical frameworks based on principles of virtue, duty, and social responsibility, fostering trust and integrity developed by schools like Stoicism and the moral principles rooted in the Vedic traditions have been known for thousands of years and yet we find instances where they are ostensibly ignored when guiding corporate conduct and decision-making.
People who work at McKinsey and its competitive set are the best of the best when it comes to corporate knowledge and skill. They are folks who have successfully navigated the gauntlet of superhuman expectations starting from high school, through competitive colleges, and subsequently the most competitive of business schools. Many have doctorates from the most elite universities across the world. This firm advises the most prestigious organizations, public, private and everything in between. In most conversations with people who have worked at the firm at any point, I am enthralled by the range of knowledge and the skill they seem to easily summon. It is no surprise that most epistemological tools and the entire field of study is extensively referenced and used by such colleagues.
Yet something is wrong; there is imperfection in this knowledge. Obviously not implicating the vast majority of individuals who work there but rather the collective itself.
I read in an article from 2019 in The Economist recently that “til a decade ago no McKinseyite had ever been sued for securities-law violations. In 2012 its former managing partner, Rajat Gupta, was convicted of insider-trading committed after he left the firm. Then in 2016 McKinsey was embroiled in a scandal in South Africa after it worked with Trillian, a local consulting firm owned by an associate of the controversial Gupta family (no relation to Mr Gupta). Mr Sneader has repeatedly apologised.” Kevin Sneader had taken over as global managing partner the year before that article was written a role now held by Mr. Bob Sternfels.
“More recently it has faced allegations that its work on behalf of companies in bankruptcy in America represents a conflict of interest, because its $12.7bn investment affiliate, McKinsey Investment Office (mio), may invest in securities related to the bankruptcies. It denies the allegations, saying that mio is a separate entity whose investments are controlled almost entirely by outside investment managers.”
In a recent WSJ article, more trouble was reported for the firm. The paper reports that, “in August 2013, consultants from the firm sent a memo to Purdue executives with 20 recommendations they said would boost sales of OxyContin by more than $100 million annually. McKinsey advised Purdue that there was “significant opportunity” to shift sales calls to the highest volume prescribers, who as a group wrote 25 times as many OxyContin prescriptions on average than their peers, according to the memo, included in unsealed court records.” In the same article it is reported that “McKinsey also advised Purdue and Endo on how to target the U.S. Department of Veterans Affairs for sales of their products, according to documents made public through the firm’s settlements with state and local governments. This advisory work occurred while McKinsey was simultaneously working as a consultant for the VA itself. McKinsey has said that it advised the VA on matters unrelated to opioid procurement.”
This example clearly illustrates that without an ethical basis, all knowledge, no matter how rigorously arrived at, is tainted and doomed to fail. Later, if not sooner. It appears to be a lesson we are determined to constantly relearn in the corporate world when even the best amongst us seem to keep getting caught out on it.
In the age of Gen AI we are becoming acutely aware of the need for balancing empiricism and testimony. Large Language Models within Machine Learning can crunch gargantuan amounts of data and respond to queries with supreme confidence demonstrating in plain sight, the supreme viability of empiricism and simultaneously; revealing its weakness in hallucinations, spurious answers and other unfit for use scenarios. So we apply Reinforcement Learning from Human Feedback (RLHF) , a real world example of balancing empiricism with testimony.
The recognition of both empirical observation (Pratyaksha) and authoritative testimony (Shabda) in the Vedic schools can inform corporate decision-making processes especially in technology intensive work. In my experience this is most evident when technology teams are in the process of launching a product. We know at all times exactly what is happening with the process of product design and development through empirical data from various tools. Yet we find we need actual commentary and verbal overlay to explain why the measures are doing what they are doing. In the Retail sector, we are often told that there is no substitute for actually walking in the store and from my experience I could not agree more. Talking to an experienced store manager or a loss prevention specialist can give you color and context that no amount of data and analytics by itself can. The same is true for Distribution Centers. For me this is most well illustrated during a typical technology crisis call. Routinely, people from diverse ends of the tech ecosystem share impressions and data from their respective tools to isolate problems and resolve crises. IYKYK.
Finally, it is important to me that I finish with acknowledging uncertainty and limitations. The skeptical traditions within Greek philosophy and the recognition of non-apprehension (Anupalabdhi) in certain Vedic schools highlight the importance of acknowledging the limitations of knowledge. This is probably the most misunderstood of traits in corporate America where we overvalue demonstrations of certainty colored by aggressive and loud proclamations of expert knowledge over true intellectual humility.
All the time we know that there is no such thing in perpetuity. Expertise wanes, circumstances change.
It took Daniel Kahneman an outsider, who recently passed away, to shake the rigid expertise of the entire field of Economics that preceded him. Ironically he argued that there is no absolute expertise and we need to deal with behavioral implications on economic models. Prior to the pioneering work of Daniel Kahneman and others in the field, mainstream economic theory largely adhered to the assumptions of rational choice theory and expected utility maximization. These assumptions of rational choice theory and expected utility maximization formed the foundation of many economic models and theories, such as consumer choice theory, game theory, and efficient market hypothesis. However, Kahneman's work, along with other behavioral economists, challenged these assumptions by demonstrating that human decision-making is often influenced by cognitive biases, heuristics, and psychological factors that can lead to deviations from the predictions of traditional economic theory.
The best way to deal with uncertainty is to be great at responding to unexpected situations. Adaptability is a skill that is uniquely appreciated in entrepreneurs and in startups and routinely put to the test in their daily conduct. Knowing this, corporations can cultivate a culture of intellectual humility, recognizing the inherent uncertainties and complexities in decision-making, and embracing continuous learning and adaptability.
I invest in startups. My career decisions to venture through companies of varying scale, sector and location; reflect my acceptance of limitations and uncertainty. I have concluded that I will make mistakes no matter what, and given that acceptance, I want to do things that are most interesting to me.
The result is that my mistakes are interesting too.
Anupalabdhi, a tool that uses the absence of something to learn, is only a tool when we wield it, and for that we have to venture into the unknown.
As I wrote this essay and in preparation for it, I realized that for Millenia there have been entire schools of deep thinkers who have built systems to rigorously analyze both knowledge and of course its object, the truth. It is a quest uniquely natural to our species. I also realized that this pursuit has been the quest of only a few, with most of humanity contend to just accept information at face value. Its apparent that the exponents of this craft, of learning and knowing elusive truths, have been disproportionately successful in every generation.
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