it’s not complicated – review

“In times of change learners inherit the earth; while the learned find themselves beautifully equipped to deal with a world that no longer exists” —Eric Hoffer

A major focus of my work is getting people to think in terms of complexity and understand the difference between complicated and complex systems. I use the Cynefin framework as the main point of reference. In It’s Not Complicated, by Rick Nason, the Cynefin framework is never mentioned but it covers similar territory, namely that much of business is complex and we have, unsuccessfully, been using mostly complicated models and tools to understand business for the past century. As Nason states at the beginning of the book: “Engineers, scientists, and ecologists have been thinking in terms of complexity for fifty years, and it is time that the business community considered some of the valuable and interesting lessons the field has to offer.”

A quick guide to see if your situation is complex

Simply put, business is complex because people are involved: “Complexity generally occurs whenever and wherever there are human interactions.” Successful businesses understand this, at least implicitly: “It is thinking, creativity, and risk taking that lead to sustainable competitive advantage.” Over-reliance on data can be dangerous, and Nason goes into detail on how US Secretary of Defense, Robert McNamara disastrously managed the Vietnam War with spreadsheets: “You cannot collect data on things that are unknown … even if the factors are known, the precision needed for the data to be useful for a complex problem would not be achievable.”

None of us are as smart as all of us, and nature trumps us all. Nason refers to Orgel’s Second Rule that, “evolution is smarter than you are and that events in the business [human] world turn out to be more creative and clever than the best minds can imagine.” In addition, serendipity plays a critical role: “Complicated systems allow us the illusion that luck or serendipity played at best a limited role in our success and thus, that whatever success we have is almost exclusively the result of our own skills and effort.”

Instead of Cynefin’s Probe > Sense > Respond approach for the Complex domain, Nason advocates Try > Learn > Adapt, which is pretty well the same. Nason also repeats a quote from General Eisenhower several times in the book, namely that “plans are useless, but planning is indispensable”. Strategic planning requires a complexity mindset. “The fact that strategy is complex means that all of the superficially undesirable traits of complexity come to the fore in strategic planning: the unpredictability; the lack of reproducibility; the lack of control; the role of serendipity; the randomness; and the inability to use superior skill, knowledge, and complicated training.”

The last chapters of the book are dedicated to economics and financial risk assessment. Nason concludes by citing seven factors that are making the world of business more complex.

globalization

the internet

social media

ideas over objects [rise of intangible goods & services]

scalability of these intangible goods [network effects]

big data

complex global social issues

I would recommend this book to managers, economists, business schools, and strategic planners, especially if they are unfamiliar with complexity. For anyone with a solid understanding of complexity, this book would be a light read.