Organize for Complexity:: business change [presentation]


Dance of silosPlease, please, PLEASE take the time to view this excellent presentation. Even if you only view it at “surface level” it may explain nagging doubts you may have had about the effectiveness of hierarchical business structures. It may help you to visualise your own organisation in a radically different (silo free) manner.

More importantly it may be the “spark” that is required to re-ignite a passion amongst co-workers who have had similar thoughts about the operational structure, misaligned or ill-conceived strategies and all the other "issues" that affect motivation and performance!

There are more levels (or layers) to be considered and that aren’t really covered by the presentation. But I suggest you view the presentation first…

The presentation illustrates how a poor operational structure "constrains" the performance of the system. I have come to view the “before and after” as: the difference between a system designed for management as opposed to one created to serve.

“Many a mickle maks a muckle”: how micro issues can become macro [systemic] problems

Misalignment between structure and strategy causes “ambiguity” which, in itself, adds to COMPLEXITY: impacts profitability (graphic – link to explanation)

What you do about it comes down to just 3 options…

  • Complexity decl marg returnsDo nothing and continue to accept the higher costs and lower profits, satisfaction and morale, or
  • Introduce more-sophisticated systems to manage the increasing complexity, or
  • Reduce or remove the complexity via simplification in parts of, or across all of, the business.
Complexity is also a source of risk, which, unmanaged, is a threat to the resilience of the system. But, these “self-generated” risks are amplified and, once communicated to connected systems and networks (e.g. supply chain), are outwith the scope of influence of the originating source, so add to SYSTEMIC UNCERTAINTY that feedback at every scale (from micro to macro) as market VOLATILITY…etc: “It’s a VUCA World”   BusinessRisks
This final graphic may just provide a clue as to, how much of what we have come to “believe” to be outwith our control [uncertainty; unknowns], actually originates from within business systems [risk; knowns] BUT, as undetected and unmanaged at micro level creates macro and systemic problems.

One Response to Organize for Complexity:: business change [presentation]

  1. David MARTIN says:

    Hi David,

    Interesting Beta II publication, but I desagree about the way to simplify a non resilient or complex organization … Since the human factor ( the most complex ) is part of any human organization, since money based performances compensate frustration, such beta organization or any other organization will be complex or may failed. You not only leader to lead, but also leaders to be responsible of their act or strategies. Even if you create a Cell you will need someone responsible for and you will of course base is salary on his level of responsabilities, providing an internal frustration into all cell. As well managing a performance cell instead of a personnal performance may lead to unexpected human behaviors …. They may be hundred of human aspect which may bring such organization to failed or collapse trying to reply to a market behavior wre such type or organization can not support and where alpha orgnaization will be performant …. The organization must be simplified of course, but studied on a case by case, based on the culture, the market, the objectives etc … lets Beta to US startups, to IBM, PwC or Mc Kinsley, they already have some failling exemples trying to simplify profitable orgnaizations to bankruptcy lol

    A bad manager/leader will hire bad employees and build the wrong structures / organizations and define the wrong projects objectives leading, if not to chaos, collapse, to bankruptcy … In my opinion.

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