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Complex Systems Make Threat Identification Difficult

Complex Systems Make Threat Identification Difficult
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One of the elements of our VUCA acronym is the idea that our environment is continuously increasing in its level of complexity. There are many ways that we can think about this. All of which lead to a general agreement that it is nearly impossible to understand the outcomes or products of a system simply by looking at the individual parts and understanding what they do. Systems thinking evolved in response to this challenge and focuses on the way that a systems constituent parts interrelate and how systems work together over time within the context of even larger systems. An entirely new way of thinking has emerged because the elements of complex systems can no longer be understood as a collection of linear processes.
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Instead, the elements of a system are interconnected in such a way that each element depends on others to function. And outcomes are produced not as outputs of each element, but rather as a result of synergies between and among elements within the system. The moral of the story, the way complex elements interact within a complex system are really hard to understand. And because they’re hard to understand, it’s very difficult for high stakes leaders to easily see where a weakness in their complex business system might generate an issue that could eventually become a crisis. In 1979, Russell Ackoff, a professor of system sciences at the University of Pennsylvania, wrote in his now very well-known article, The Future of Operational Research is Past.
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That quote, managers are not confronted with problems that are independent of each other, but with dynamic situations that consists of complex systems of changing problems that interact with each other. I call such situations messes. Managers do not solve problems anymore, they manage messes. While we won’t dive into the notion of messes versus crises in this course, Ackoff’s point is that managers of complex systems such as those faced by high stakes leaders every day will find it exceptionally challenging to predict the source of what he called a mess and what we will call in this course a crisis. Charles Perrow, a professor of sociology at Yale, wrote extensively about the impact of challenges in large social systems.
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He believed that crises are an unwanted byproduct of technological progress. His theory of vulnerability in complex systems identified two intersecting factors at the heart of both modernization and system vulnerability, complexity and coupling. He wrote, as socio-technical systems become more complex and increasingly connected, in other words, more tightly coupled to other systems, their vulnerability to disturbances increases exponentially. The more complex a system becomes, the harder it is for anyone to understand it in its entirety. Tight coupling between a systems component parts, and those of other systems, allows for the rapid proliferation of interactions and errors throughout the system. In these complex, tightly coupled systems, we should therefore expect periodic failures that have the potential to escalate out of control, end quote.
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And in fact, this is what we are seeing in our VUCA business environments. As organizations grow, the number of connections among its various stakeholders increases making effective and consistent interactions more difficult to execute. As organizations grow, the number of products and services grow, making them more challenging to organize and manage. As organizations grow, the leadership structure becomes more complex making effective management a more complicated endeavor. And as advances are made in hardware, software, corporate policies, business practices, regulations, etc, it gets more and more difficult for the organization as a whole to keep up, to stay organized, to manage risk, to avoid crises.
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The point here is that our organizations and the environments in which we operate are constantly becoming more complex and more difficult to control. As high stakes leaders, we need to recognize this new reality and become even more attentive to early indications of trouble. Because if we don’t, not only will emerging threats be more difficult to spot, but they will be more challenging to resolve once they become crises. In the quasi immortal words of famous Michigan football coach, Bo Schembechler, every day you either get better or you get worse. You never stay the same. In the context of our increasingly VUCA world, if we’re not doing what we can to stay ahead of this added complexity, we’re falling behind it.
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And if we fall too far behind, we may not have any chance to see our next crisis coming.
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High Stakes Leadership: Leading in Times of Crisis

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