How Companies Can Manage Complexity in an Increasingly Complex World.

16 12 2017

Courage is grace under pressure.            Ernest Hemingway

In todays business the competition is harder and the customers are more demanding than ever. Which means that you have to work harder in all ways. Innovation and creativity is needed as well as long working days if you want to survive.

Yves Morieux, has written the article; Six Ways to Get People to Solve Problems Without You. ‘In complicated organisations, managers spend 40% of their time writing reports and 30% to 60% of it in meetings’. Author; “Companies clearly need a better way to manage complexity. In our work with clients and in our research, we believe, we’ve found a different and far more effective approach”. The author is talking about creating an environment where employees can work with one another and be creative together on too complex challenges. “This approach leads to organisations that ably address numerous fluid and contradictory requirements without structural and procedural complicatedness”.

From one of my earlier blog posts; Transparency and Leaders Will to Create a Culture of Candor, Warren Bennis, Daniel Coleman and Jim O Toole has some interesting thoughts in terms of being transparent. They say, that leaders who cares about a good culture in their organisations, develop a culture of candor. “Before an organisation can develop a culture of candor, it must examine the cultural rules that currently govern it. Such cultural rules run deep and they typically resist change”.

The authors encourage leaders to take action if they want information to flow freely in the organization, and in that case be the one who sets a good example. Authors; “If leaders regularly demonstrate that they want to hear more than incessant happy talk, and praise those with the courage to articulate unpleasant truths, then the norm will begin to shift toward transparency”.

Because of the importance of this subject, also from one of my earlier blog posts; Human-Biases-In-Organizations, my reference is from an interesting article from Harvard Business Review; Radical Transparency Can Reduce Bias-but Only It it’s Done Right (By Professor Francesca Gino). She refers to Ray Dalio who’s philosophy consists of radical transparency into the company. Here Dalio say; I think the greatest tragedy of mankind is that people have ideas and opinions in their heads but don’t have a process for properly examining these ideas to find out what’s true. That creates a world of distortions. That’s relevant to what we do, and I think it’s relevant to all decision making. So when I say I believe in radical truth and radical transparency, all I mean is we take things that ordinarily people would hide and we put them on the table, particularly mistakes, problems, and weaknesses. We put those on the table, and we look at them together. We don’t hide them.

In this case, Dalio, got reactions from three of his top confidants where they meant that Dalio was hurting the company by being too honest. His action to resolve this problem was to meet employees individually and find a solution through discussions on how to treat one another. His goal was to create a culture of sharing ideas without creating lasting conflict, as well as engaging employees in thoughtful disagreements.

Back to Morieux, where he is talking about six rules. This approach incorporates simple and powerful principles which the author calls smart rules, these rules will help managers to mobilise their subordinates skills and intelligence.

Author; “In and of itself, this complexity is not a bad thing-it brings opportunities as well as challenges. The problem is the way companies attempt to respond to it. To reconcile their many conflicting goals, managers redesign the organizations structure, performance measures, and incentives, trying to align employees behavior with shifting external challenges.

Let’s look at the six rules.

Rule 1: Improve Understanding of What Coworkers Do. The author tells us that people need to understand each other’s work. “the goals and challenges others have to meet, the resources they can draw on, and the constraints under which they operate”. Job descriptions aren’t good enough information for people, you can learn by observing and interacting. The author makes us aware of the importance of managers responsibility that such learning takes place. “Without this shared understanding, people will blame problems on other people’s lack of intelligence or skills, not on the resources and constraints of the organization”.

Rule 2: Reinforce the People Who Are Integrators. Here the author talks about conflicts between front and back offices. The need to standardize processes and work, where front offices has focus on the needs of individual customers. “In almost any unit you will find one or two managers-often from a particular function-who already interact with multiple stakeholders (customers as well as other functions). If you’ve followed the first rule and observed people at work, it will probably be fairly obvious to you who these individuals or groups are. These people can act as integrators, helping teams obtain from others the cooperation needed to deliver more value”.

Rule 3: Expand the Amount of Power Available. People with the least power in an organization often takes most of the burden of the company as well as getting the least credit. “Companies that want to prevent this and increase cooperation need to give these people more power so that they can take the risk of moving out of isolation, trusting others, showing initiative, and being transparent about performance”. By doing this, the firm doesn’t have to take the power away from the other people in the system.

Rule 4: Increase the Need for Reciprocity. Expanding responsibilities of integrators beyonds activities over which they have direct control. “Making their goals richer and more complex will drive them to resolve trade-offs rather than avoid them. But if you measure people only on what they can control, they will shy away from helping with many other problems you need their input on”.

Rule 5: Make Employees Feel the Shadow of the Future. Author; “People are more likely to feel the shadow of the future if if you bring the future closer”. People who are involved in a long term project will be out when the project is completed. They are moved to another job or location. “They won’t be affected by the consequences of the actions they take, the trade-offs they make, or how well they cooperate”.

Rule 6: Put the Blame on the Uncooperative. Author; “Some activities involve such a long time lag between cause and effect (for example, in some research and development efforts) that it’s impossible to set up direct feedback loops that expose people to the consequences of their actions”.

I hope you find this interesting reading and learn something from it, I did.

Dealing with complexity is an inefficient and unnecessary waste of time, attention and mental energy. There is never any justification for things being complex when they could be simple.              Edward de Bono

Author, Inger Lise E Greger, Master of Science in Change Management

 

 

 


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