Complexity

Complexity

Friday's complexity

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Here are some of the observations and insights that were shared via Twitter (and other places) this past week.

Leadership as emergent, co-created and unheroic – by @JohnnieMoore

leadership is a complex social process enacted by the many. It is not a rational, scientific endeavour practised by a few, gifted individuals. That is to say, it is an emergent phenomenon that is co-created in the moment of people’s everyday interactions. As such, it is a normal characteristic of the day-to-day relationships of interdependent people.
~ Chris Rodgers

@johnt – Responding to Complexity & Uncertainty

Ralph Stacey (on shadow system dynamics), Karl Weick (social psychology of organising and sense-making), Manuel Castells (the network society), Albert Bandura (social learning, self-efficacy, social psychology), Stafford Beer (viable systems and distributed control), Albert Cherns (socio-technical principles), Russell Ackoff (systems thinking) etc all intellectual heroes. In my view, their insights on complex social systems leave many soc. biz ‘experts’ on the starting blocks. ~ @smartco (in comments)

@JerryMichalski – really interesting ideas on complexity and systems thinking – by @JurgenAppelo

How organizations can thrive in the network era

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I recently covered the BetaCodex Guide to Organizing for Complexity. A new special edition paper has just been released, Turn Your Company Outside-In. The initial premise is that traditional organizational design, and the ubiquitous org chart, is fundamentally flawed.

The challenge of moving from a hierarchical to a network structure is a complete shift in how we have thought about organizations. The BetaCodex model is based on solid systems and organizational theory from the likes of Stafford Beer, Charles Handy, Henry Mintzberg and Thomas Malone. From these, and others, Betacodex have developed two main design concepts: 12 laws, and the double helix transformation framework.

The most valuable part of this paper are the two case studies, that show how companies can create a new outside-in structure and better address external complexities. One is a German technology firm and the other a Brazilian packaging producer. This paper carries on from the last and includes enough practical information to make real structural change in organizations.

The BetaCodex framework supports the concept of loose hierarchies & strong networks, and provides a concrete structure to address the fact, highlighted in the Cluetrain Manifesto, that hyperlinks subvert hierarchy. I would suggest this as a sub-title for the paper: how organizations can thrive in the network era. A BetaCodex structure could lead us to a world without bosses and would help to ensure that the sociopaths do not take over. It would be a real thrill to work with an organization that is committed to such a change.

Negotiating between chaos and project deadlines

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I watched Dave Snowden talk about tacit knowledge, and many other things, at the State of the Net Conference. Several comments are worth repeating, in my opinion:

If we don’t understand the why of things, we can never scale the how.

Management science regularly confuses correlation with causation.

We will always know more than we can say. We will always say more than we can write down.

Fallacy: If you give the right information, to the right people, at the right time, they will act accordingly. As “pattern-seekers” we may not even “see” the data when it is presented.

Human knowledge requires mediation.

Resilience comes from early detection, fast recovery & fast exploitation of the opportunities presented, which then becomes a new paradigm. We need to architect organizations based on an assumption of failure, not an assumption of success.

As I reflected on Dave’s comments I thought about my previous presentation on coherent communities and how it is important to connect people in the most appropriate way for the problem at hand. It seems that chaos abounds on the Internet, with a flood of ideas  and nobody really knows what is causation and what is correlation. However, there may be something to be learned here, hence the value of disparate social networks. Communities of practice have the openness and flexibility to deal with complex problems as people can share freely but are in a constrained problem space, so that over time we can share more than what we say or write down. Meanwhile, getting work done inside the organization has to be further constrained, and focused on projects where we can see the relationships between cause and effect.

For the knowledge worker, and for networked organizations, the challenge is in negotiating, and understanding, all three spaces. It is necessary to know where failure is optimal (early) and how to mediate knowledge from the chaotic edge to the work bench. Work needs to be simultaneously informal & structured and balanced between both goals & opportunities. Constantly negotiated boundaries (as Dave says, it’s like raising teenagers) can help organizations become more resilient. Identifying the boundaries is a good start.

 

Complex is the new normal

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“Change becomes chaotic when employees see and hear two or more different change methods and messages“, writes Jay Deragon in managing on the edge of chaos. Jay has an image that shows that ordered organizations need to empower their employees to deal with more complexity, while those in chaos need to gain alignment in order to get out of chaos. Complexity is becoming the “normal” state, and it can be dealt with, but not with traditional management methods.

I have combined Jay’s image with the Dave Snowden’s Cynefin framework, and some added arrows, here:

Complex is the new normal. However, it requires more than just discarding some of our traditional ways of dealing with change. It also means staying out of disorder:

The fifth domain is Disorder, which is the state of not knowing what type of causality exists, in which state people will revert to their own comfort zone in making a decision. ~ Wikipedia

Not knowing whether you are in a chaotic or complicated state is a large part of the problem with organizational change initiatives. Thinking you can manage your way through the change assumes a complicated state, where you can sense & analyze before responding. Assuming a chaotic state means acting before sensing, and often getting it wrong. If the situation facing the organization is indeed complex, then neither approach is suitable. The approach is to Probe, Sense & Respond.

To shift to a complex reality, the seven essential criteria for an increasingly complex world would be a good starting point for most organizations, something I rarely see in action. More detail is provided in a guide to complexity and organizations. Managing organizations on the edge of chaos needs an understanding of complexity. Most organizations and institutions have a long way to go, and I am sure that employees will continue hearing two or more conflicting messages about change, as their leaders flounder for control.

A guide to complexity and organizations

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Via Jay Cross is this amazing synthesis – Organize for Complexity – of how complexity affects our work and the ways in which we can change our organizational structures to account for complexity, instead or adding more complication. If you know nothing about complexity, read this. If you know a lot on the subject, keep it as a job aid or use it to help others.

I like the depiction of market dynamics, to which I have added the upper image. It shows the fundamental shift we are going through as the network era unfolds.

The definition of complex systems is quite useful:

Complex systems have presence or participation of living creatures. They are living systems – that’s why they may change at any moment. Such systems are only externally observable – not controllable.

A complex system’s behavior is non-predictable. Here, it’s natural that there is a level of error, uncertainty and illusion that is much higher than in complicated systems.
A complex system may possess elements that can operate in standardized ways, but their interaction would be constantly changing, in discontinuous ways.

The paper includes design principles as well as “how-to” implementation suggestions. Start with, “Design principle ‘Beta’: Self-regulation within the team. Control through peer pressure and transparency. Principles and shared responsibility.” This is a comprehensive, but not heavy, read. I am sure I will turn to it often.

I must say that I agree with pretty much everything in this paper, so I strongly recommend it.

in an increasingly complex world

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Robert Warwick – Following a comprehensive literature review, heavily influenced by complexity sciences, we came up with seven essential criteria that are important to consider in an increasingly complex world, these were:

    • Go out of your way to make new connections.
    • Adopt an open, enquiring mind-set, refusing to be constrained by current horizons.
    • Embrace uncertainty and be positive about change – adopt an entrepreneurial attitude.
    • Draw on as many different perspectives as possible; diversity is non-optional.
    • Ensure leadership and decision-making are distributed throughout all levels and functions.
    • Establish a compelling vision which is shared by all partners in the whole system.
    • Promote the importance of values – invest as much energy into relationships and behaviours as into delivering tasks.

This is a good set of guidelines (via David Hodgson) and useful for conversations around organizational change.

Connections: develop an active PKM process, which is reviewed from time to time

Open & Enquiring: practice critical thinking, questioning all assumptions, including your own

Embrace uncertainty: think of all your work as in a state of perpetual Beta

Diversity: “Human systems thrive on variety and diversity. ~ Esko Kilpi”

Distribute Leadership: think of leadership as an emergent property of your networks and not a permanent position in a hierachy

Vision: shared vision comes through trusted networks, however a clear vision is necessary, but not sufficient

Values: transparent organizations are better at sharing values but the initial design influences everything

It’s not complicated, you see

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When Bayer’s Material Sciences Division decided to become more collaborative, they realized that the main challenge in promoting knowledge-sharing across organizational boundaries is culture. They deployed the software platform (IBM Connections) without any formal training, saying that when the tool is simple to use, people focus on collaboration, not the software. Their solution was simple.

I know few enterprise software projects that go without a hitch. These are complicated tools and even after implementation most people only use a few functions from the wide array that are available. As complexity increases, and we keep adding new tools to the workplace, the simpler the tool, the easier it will be to implement, especially since the lifespan of our knowledge tools keeps getting shorter.

simplified design for complexity

Complication is the industrial disease. Understanding the difference between complication and complexity is extremely important in today’s workplace. The Cynefin framework  distinguishes between four domains to describe systems:

  • Simple, in which the relationship between cause and effect is obvious to all, the approach is to Sense – Categorise – Respond and we can apply best practice.
  • Complicated, in which the relationship between cause and effect requires analysis or some other form of investigation and/or the application of expert knowledge, the approach is to Sense – Analyze – Respond and we can apply good practice.
  • Complex, in which the relationship between cause and effect can only be perceived in retrospect, but not in advance, the approach is to Probe – Sense – Respond and we can sense emergent practice.
  • Chaotic, in which there is no relationship between cause and effect at systems level, the approach is to Act – Sense – Respond and we can discover novel practice.

Most of today’s larger companies have developed complicated structures. To enable growth and efficiencies, more and more processes have been put in place. Management schools aided and abetted this movement. New layers of control and supervision continue to appear, silos are created, and knowledge acquisition is formalized in an attempt to gain efficiency through specialization. To compensate for complicated processes, some enterprises have attempted to become learning organizations, putting significant effort into training (but not learning). But training design & development just got more complicated.

Complexity is the new normal. Because everything is interconnected by networked technologies today, systemic changes are sensed almost immediately. Reaction times and feedback loops have to get faster and more effective to deal with this. Formal training addresses a mere 5% of workplace learning, and our current models for managing people, training, and knowledge-sharing are insufficient for a workplace that demands emergent practices just to keep up. Knowledge workers today need to connect with others to co-solve problems, but complicated policies, procedures, and guidelines often stop them.

In a short interview, via Luis Suarez, Steve Jobs describes how Apple deals with complexity through simplified design. First of all, there are no committees. Secondly, only one person is responsible for each area (simplified leadership). Finally, teams communicate and collaborate with other teams on an ongoing basis. Jobs says that Apple is run like a start-up.

Organizations need to embrace complexity, instead of treating it as mere complication. We know that  innovation can abound in start-ups, but why not in larger organizations? One problem is that growth creates sustainable efficiencies, which get embedded and codified. These efficiencies can lead to greater market share, which companies become addicted to, not seeing that they are simultaneously becoming less innovative.  A Probe-Sense-Respond approach, or perpetual Beta releases, is necessary to deal with complexity, through constant learning by doing. Continually probing via many new, small initiatives means that organizations have to abandon complicated command and control systems, trust workers, and give them the space to learn while working.

probe sense respond

The challenge is to get the addicts (companies) to stop their lifelong destructive behaviours, which are now catching up with them. It won’t be easy, but it’s not complicated. It’s actually simple ;)

I come not to bury training, only to put it in its place

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I’ve taught ABCD objectives (audience, behavior, condition, and degree) on many continents, and in universities, companies, and government agencies. I promise you that students of instructional design appreciate ABCD. They rely on the mnemonic to help them produce and screen their efforts. Admittedly trickier is demonstrating where objectives come from, establishing that valuable link between the tasking, analysis, goals, and objectives. That is a story for another time. —Allison Rossett

Methods like ABCD work very well when you know what you are trying to achieve and understand the systems you are operating in. They work well when you have established best or good practices to base the training on. But what happens in complex environments, when “the relationship between cause and effect can only be perceived in retrospect, but not in advance”? This is the situation many workers find themselves in today.
cynefin education training
In complex environments, a Probe-Sense-Respond approach is required, and this is something that training and education programmes, designed in advance and directed by management, cannot address. While people still need to be trained and educated, that alone will not prepare them for a networked workplace that demands the integration of learning and working.
probe sense respond
The increasing complexity of our workplaces means we have to accept the limitations of training and education as we have practiced them. There is a growing need to help people be more creative and to solve complex problems, on a daily basis and in concert with others. Even the best training programmes cannot help here. Organizations (HR, L&D, OD, KM, etc) need to add significantly more thought and resources to enable people to learn socially, share cooperatively, and work collaboratively.  Work is changing, and so must learning support. Making better carriages will not help.

Innovating our way out of the industrial era

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I have frequently said that simple and complicated work is getting automated and outsourced and that the real value in the networked enterprise is in complex (creative) work. Standardized work, that can be done by many, is low value in the network era. See my posts on Job Automation or Exception Handling for further reading.

 Bob Cringely clearly shows how this works in information technology.

Toward the top end of IT the value of individual contributors becomes extreme. There are many IT organizations where certain critical functions are dependent on a single worker. These are complex or arcane tasks being done by unique individuals. You know the type. Every organization needs more of them and it is easy to justify looking wherever — even overseas — to find more.  It’s at this level where the commodity argument breaks down.

The bad news is that routine, standardized work has increasingly lower value. The good news is that almost every person has the capacity to do more complex and creative work. We have been designed as learning organisms. Our main constraints are our artificial structures, especially our schooling systems. Much as we no longer need the majority of the population to grow crops, we no longer need a large workforce of widget makers or data processers. However, we have an infinite demand for creative products and services.

As Cringely concludes:

So we have a standoff. Corporate America has, for the most part, chosen a poor path when it comes to IT labor issues, but CEOs aren’t into soul-searching and nobody can turn back the clock. Labor, in turn, longs for a fantasy of their own — the good old days.

The only answer that makes any sense is innovation — a word that neither side uses properly, ever.

The only way out of this mess is to innovate ourselves into a better future.

Between organizations, innovation can start by increasing connections, as it is obvious there are few connections between labour leaders and CEO’s.  Inside organizations, innovation can be facilitated through narration, transparency and power-sharing. That’s how we can start to get ourselves out of this wicked problem of work in the 21st century.

Aligned principles for an open, networked society

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Via Ross Dawson, here are Don Tapscott’s four principles for the open world:

Collaboration. The boundaries of organizations are becoming more fluid and open, with the best ideas often coming from outside.

Transparency. Open communication to stakeholders is no longer optional, as organizations become naked.

Sharing. Giving up intellectual property, including putting ideas into the commons, is a massive source of value creation.

Empowerment. Knowledge and intelligence is power, so as they are distributed, we gain freedom.

And, here are my three principles for Net Work, or getting stuff done in this open world:

Narration, Transparency and Power-sharing

Narration is making one’s tacit knowledge (what one feels) more explicit (what one is doing with that knowledge). Narrating work is a powerful behaviour changer, as long-term bloggers can attest.

Transparency is an easy concept to understand but much more difficult to implement in an enterprise. It means switching the default mode to sharing. This can be enabled by social media, but social media also make the company culture transparent. A dysfunctional company culture does not improve with transparency, it just gets exposed.

Distributed power enables faster reaction times so those closest to the situation can take action. In complex situations there is no time to write a detailed assessment. Those best able to address the situation have marinated in it for some time. They couldn’t sufficiently explain it to someone removed from the problem if they wanted to anyway. This shared power is enabled by trust. Power in knowledge-based organizations must be distributed in order to nurture trust.