Dear Reader,

Welcome to the April issue of perspectives!

It's become a commonplace to say that change is the only constant, and how it's an increasingly complex world in which we are living these days. And I'm sure we've all complained at some time or other about how difficult it is to keep up with everything that's happening.

So, this month's article is about the unpredictable!


David Booth



The art of the complex

…or ‘the science of the not-so-simple'.

Have you ever thought that things are just too complicated? That there's too much going on, too many changes, to make sense of everything and work out how to deal with it? Perhaps it's easier to let events take their course and see what happens rather than try to steer the organisation to some sort of common strategic plan that will be outdated before the ink is dry and the document neatly bound for presentation to the Board?

Back in the good old days, markets grew and developed in predictable fashion, competitors did what you expected of them, and your brand's consumers responded by buying more when you increased your share of voice of the only advertising medium that mattered, TV. The Production Director always managed to squeeze that little bit extra cost-efficiency that the MD demanded, and customer service initiatives were the no. 1 priority (although in practice the Sales Department ruled). Strategic Planning meant tweaking last year's document, and learning how to play the budget negotiation game with the Finance Director.

Or something like that.

I think most of us who would say that business is just a little more complicated today. Markets, industries, competitors can change radically and often in unexpected ways, prompting unscripted responses from the other players caught up in these. It's a constantly changing, turbulent landscape - uncertainty abounds. But although the trajectory of an organisation isn't linear – or even parabolic – neither is it purely random.

We are accustomed to thinking ‘in straight lines', in rational steps projecting the future from the present. But things are more complex than that (and indeed probably always were!) – and so we struggle to make sense of it all sometimes.

There is a developing school of thought that might help. Ideas from ‘complexity theory' are being used to help change the way people think about situations. For example, we might not be able to explain why something happened in detail, but there could be some principles or patterns that apply. Looking at a group of organisations in an industry as a system with lots of connections and interactions, with each organisation trying to make sense of what's affecting it and adapting accordingly, gives a different perspective to the traditional market / competition model.

In such a view, an organisation – or a person – reacts to others around it, rather than to some ‘big picture' plan. You can see this in how people behave in an organisation – we all make sense of what a change or message means in the context of our own jobs, teams or departments, and how others respond is a big influence on how we interpret what it means for us. That's why communication isn't just a linear cascade of briefings – it's the informal ‘water cooler' conversations, and the body language and behaviour of others, that determine how people then think, feel and act.

This is a powerful way of thinking about how change happens – in practice rather than in theory – and how strategies are interpreted and implemented across and through an organisation. Complexity theory provides a way of thinking about this, and a language to describe what happens. Sometimes it's helpful to think of organisations as ‘complex adaptive systems', with lots of individual ‘sensemaking' and local reactions going on that determine how the organisation collectively moves forward.

There's a great example to illustrate this of flocking birds – click here to watch - it's well worth a few minutes over a coffee break. How do they keep together and fly as a group? A computer simulation has been created based on three ‘rules of behaviour' – keeping far enough apart from others nearby to avoid crowding or crashes; aligning with the average direction of flight of the birds nearby; and keeping sufficiently close to maintain group cohesion. Some parallels there with how people behave within their teams in an organisation!

I don't profess to have expert knowledge on complexity theory – it's something I'm just beginning to explore. But what strikes me is that there seems to be some useful perspectives that will help describe and perhaps explain what happens in organisations (and markets) in practice, and how they adapt to a complex and changing environment. It's another way of thinking that could help at times – if only to appreciate that nothing's simple!


For further exploration...

Cass Business School in the City of London is running a series of evening workshops about applying complexity theory to organisational change  (It was Dr Carol Webb of Sheffield Hallam University who used the flocking birds video in the workshop earlier this month.)

The complexity science computer simulation of flocking birds (by Craig Reynolds) can be viewed at http://www.red3d.com/cwr/boids/ (no maths required!)

Ralph Stacey of the University of Hertfordshire is one of the leading thinkers about the complex forces involved in organisations and the development and implementation of strategy. ‘Strategic Management and Organisational Dynamics: the challenge of complexity' is now in its 5th edition (FT Prentice Hall, 2007)

 

 

 

What do you think?

How useful is it to think of organisations as complex systems? Do you think it might help sometimes in working out how to manage in them? All opinions welcome!