Do you save for a rainy day? I always live with the feeling it might rain, and I need to prepare. Might sound like a good idea, but it does take away a little fun from the sunny days. Are you preparing for rain? Are you doing the work needed to reduce or mitigate risk? Are you maintaining processes and machine as you should?

Are you afraid to risk it? How many of us know to change our oil every 3,000 miles? Of course, we don't often say that's the "more severe" schedule as my car's owner's manual describes it. The other schedule is 7,500. As a nation, I can only imagine how much money is wasted due to over maintaining our vehicles. I'm not writing to ask you to delay your next oil change. I'm writing to talk about the idea of deferment and the art of pushing it to the limit to maximize profits.

I was reading the Union Pacific: The Reconfiguration: America's Greatest Railroad from 1969 to the Present by Maury Klein and it describes a battle between operation and staff at headquarters. Operations continually wanted to perform maintenance on the track and headquarters wanted to delay in order to save money.  The problem isn't simple. Can you delay? Yes - naturally. But for how long and how many times? Certainly, there's a point where it's too expensive to recover from deferred maintenance and just as certainly money is wasted from too frequent maintenance.

One of my favorite authors, Nassim Taleb, asks the best question. How many white swans does it take to prove all swans are white? How many black ones does it take to prove you're wrong? How many safe bridge crossings does it take to prove deferring maintenance was a wise choice? How many unsafe bridges does it take to prove you are wrong?

Pursuing profits creates too create of risks in some situations and regulation steps in for the greater good, take aircraft for example or DOT regulations for trucking. Without restraint we arrive we were in 2007 and again today – corporation are too big to fail and can’t be held accountable. I don’t like regulation either, but it’s the guard rails for short-term thinking and used correctly, rules protect the greater good. We are never free from responsibility.

When taking finance classes during my MBA program, we were taught that bankruptcy is just the price of doing business. We were taught to leverage as far as possible, meaning borrow as much money as possible to expand as far as possible. In theory, this means you capture as much money as you can while you can. In practice, it runs the risk sky high and leaves the mess for taxpayers to clean up. It should be the stockholders, but that’s the beauty of too big to fail. The company leadership and stockholders do fine. The cost is spread across the entire economy. I feel I drifted a bit too political; wasn’t my intent.

I was really interested in deferred maintenance vs. a well-maintained environment, and the art of knowing the difference. It seems to settle in on beliefs. Do you believe clever software can track all conditions and predict a maintenance schedule? The trouble is with the word, “all”. I do believe software can help, but we can't forget Taleb’s Black Swans hide in every situation.

And I only change my oil about very 6000 miles - more due to forgetfulness than cleverness.