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Why complexity is so complex?
If I write a long sentence that is missing punctuation and covers several topics, it will be a complex sentence. When we must deal with several elements that are connected, and that generate unexpected behavior, we call it complex. Our brain better handles simple scenarios. It’s simpler when there are fewer elements, fewer connections, and when behavior is as expected. Therefore, our initial inclination is to break complexity into smaller simple pieces. But does that approach work when dealing with complex problems?
The answer is NO! The proof is the number of complex problems that have reoccurred over the last 10 (even 2) years, when compared with the number of reoccurring simple problems. 90% of the reoccurring problems in business (customer satisfaction, employee retaining, supply chain, safety, and many more) and in your personal life are complex problems.
So, what is the resolution? Understanding complexity! Especially what creates complexity, and what is considered to be the working conditions to deal with complexity. Regretfully, complexity requires different tools than the analyses we are so good with. It requires synthesis or understanding the role elements have in the bigger system they are a part of. The opposite of analysis.
Don’t worry, in the following posts, I’m going to help you understand those conditions, the thinking, and the tools in simple English. After each post, you will have a better understanding of complexity. This will be translated to better business performance. If not, you are more than welcome to post a comment to any post in this series.
In this post, I’m going to share a simple way to find out what are the 3 conditions that cause complexity in any problem. Knowing what generates complexity is not going to eliminate complexity, but it is going to help to reduce it for sure.
Multiple competing drivers
The first condition is critical for the creation of complexity. Every organization (or system – a collection of interlinked elements collaborating to achieve a certain goal) has at least one driver that guides people or parts of a system behavior (let’s call system parts Agents). The more the number of drivers that push people in different directions, the more complexity will be experienced.
So, your first task is to find all the conflicting drivers that guide the area that you are trying to improve, or to resolve a challenge you may be experiencing. That is not a hard task. All you must do is to list all the agents in the area you are focused on, and list the drivers that influence their behavior.
For example, if the focus of a production line is solely quantity produced, it will be less complex than a line that is focused on quantity and quality. Obviously, a line that is focused on quality, quantity, and safety (common drivers) experience more complexity than the previous two. In today’s organization, we usually can find 3-5 conflicting drivers. If you can find more than 5 drivers in a given situation, you are probably dealing with higher-than-normal complexity.
If you have the option of reducing drivers, you will have a direct impact on the level of complexity you are dealing with. In most cases, there is a sound reason for competing drivers and it’s impossible to reduce them.
Every system, including companies, operate within an environment. For business, the environment contains customers, competitors, vendors, regulatory bodies, pressure groups, etc. Although a company has some borders that distinguish it from other players in the environment, it is not a closed system. Companies (like any other system) are open systems that are influenced by the environment. The amount and frequency of influence from the external environment is what we call external noise.
External noise in business terms can be demand, commodities prices, variety of competitors’ offerings, customer behavior and preference, laws and regulations, and fundamental changes to the environment (such as wars, financial crises, or pandemics). External noise plays two important roles in companies. First, it forces them to continuously change and get away from the status quo (growth engine). Second, external noise is also responsible in forcing agents in companies to create uncommon interactions and collaboration. In a nutshell, external noise can be the driver for continuous change.
While external noise is needed, too much of it (too many sources with high frequency) will contribute to the level of complexity. While the drivers create the basis for complexity, external noise shakes the system and increases the interconnectivity between agents. Therefore, too much external noise is a major contribution to the unexpected behavior of any group of people and the system.
Practically, collecting external events that are increasing in frequency will help to get visibility to the most relevant external events in the area you are investigating. If there is a better way to organize a company to deal with external noise, or there is an option to reduce the amount the frequency of external events, the level of complexity your organization is dealing with is going to decrease.
Back to our production line example. On top of the three drivers (quantity, quality, and safety) there might be external noises such as the continuous increase of raw material prices, growing number of mergers and acquisitions, and changes in laws and regulations.
Now we have two different types of conditions that create complexity and six specific conditions that we can start working with.
Drivers have momentum. As the momentum grows stronger the drivers will pull more at any group of people (or any system). When more than one driver pulls the system in a certain direction, it stretches the available options of the system to act between the drivers, until those options will be a thorn between the drivers. When this stretch and thorn happen more and more, the predictability of the systems (and its agents) behavior is reduced. This is the third condition that will create complexity.
In the business world what creates this momentum are internal events that continuously amplify the importance and need of one of the drivers. As relevant events to specific drivers happen more often, the momentum of the given driver grows, and with it, its complexity.
Continuing with the production line example. Every quality incident, safety-related event (including near misses), and inability to keep up with customer demand, are events that will increase a relevant driver (quality, safety, and quantity). As those events happen more often the momentum of the relevant driver increases (i.e., more safety events, more momentum to safety).
When internal events increase the momentum of more and more drivers, the complexity of a given system will increase significantly. Compared to the previous two conditions, organizations have more control over the way they react or respond to internal events. Therefore, the ability to influence this condition and reduce the overall system complexity is higher than the previous two.
Finding drivers, external noise, and internal events that fuel drivers, will give any organization visibility into the specific conditions that are responsible for the complexity they have to deal with.
While some of those conditions are hard to change, knowing them helps organizations to better deal with complexity. The conditions that can be addressed will decrease the level of complexity companies have to deal with.
On top of these three conditions, there are another three conditions that will amplify the complexity in any organization (or system). In the next post, we’ll present those amplifiers and explain what can be done to deal with them.
Now it’s your time to practice. Take a complex problem that your company deals with (such as customer satisfaction) and start to find the relevant drivers, external noise, and internal events. Think about what you can do to reduce them or to better handle them. Try those alternatives and please let me know if it helps.
You can use this approach even on a personal complex problem that you experience outside of work. I guarantee you that this approach will help you to better deal with complexity and reduce the level of anxiety that you experience when a complex problem surfaces.