The Complexity of Your Business

Business complexity can generate a variety of threats to an organization, and how the nature of the crisis environment creates challenges for high-stakes leaders, particularly in the context of threat identification. In this short activity, you’ll spend a few minutes thinking about what you have learned thus far in this module and how you should be dealing with the complexity of your business. The goal of your reflection will be to generate a few answers to this question: What can be done to overcome our complexity and create mechanisms for identifying threats?

Your business is unique and it has a complexity unlike any other. As a high stakes leader, part of your job is to find ways to manage this complexity so that your organization can be as resilient as possible. How might you think about doing so? Here are a few thoughts, first on managing the complexity itself, and second on working through the complexity to create avenues for continuous improvement and threat detection.

Managing Complexity

First, the practical reality for business leaders is that as companies grow and expand their offerings, they will necessarily become more complex. As companies grow, hiring increases and organization structures become more complex; product development, sales, and inventory management processes become more involved; technology evolves, which can be both helpful and problematic; partnerships are formed across multiple geographies, which are difficult to manage; competition spans the globe, making strategic choices more complex; and the list could go on.

Increasing complexity isn’t necessarily a bad thing in and of itself, however, some factors that add complexity don’t create value, they destroy it. For example, consider the complexity that can develop as a result of increasing regulation; the duplication of activities, roles, and responsibilities in your organization; frequent changes in organizational structure; and the evolving strategies of competitors. All of these tend to make your company less profitable – and more complex. They also create more opportunities for things to go wrong. As a high-stakes leader, you want to be thinking about making your organization only as complex as it needs to be, while eliminating complexity that adds little value.

What are some ways that leaders can reduce complexities? Here are three. First, look at complexity from all levels of the organization. Many times senior leaders see organizational design or product management or operational processes as perfectly appropriate and sensical from their perspective, yet organizational members two, three, or more layers deeper in the enterprise don’t see things that way at all. Gathering feedback from all layers will help to identify improvement opportunities. Second, when looking to reduce complexity, don’t solve symptoms. Instead, identify and solve root causes. It’s easy to mistake symptoms for causes. When leaders do so, and then solve the symptom, the problem tends to reappear. When you identify an area of opportunity for improvement, ask yourself: What is causing this problem that I’m seeing? This question will point you in the direction of a root cause. Third and finally, remember that some managers are simply better at managing complexity than others. Some managers are exceptional collaborators, some aren’t. Some managers are great at thinking in terms of process and structure, others are not. When you are looking to attack complexity, make sure that you have the best possible people doing the job.

Creating avenues for improvement and threat detection. As has been argued in many places in this course, your best resources for threat detection are your stakeholders. Given the right relationships with members of these groups, they will help you identify areas of opportunity for improvement and potential threats. In many ways, in fact, these two things can be very closely related. As complexity increases in your organization, never lose sight of the fact that the burden you will be placing on these stakeholders to identify potential threats increases. In other words, the more complex your organization, the more difficult it will be for stakeholders to see challenges, to connect the dots among a collection of seemingly small issues that might, collectively, create a meaningful organizational threat.

To help your stakeholders serve more effectively in their observer roles, you should:

1) Reduce or minimize the complexity that doesn’t add value.

2) Provide mechanisms that make it easier for your stakeholders to share what they are able to see.

Don’t force them to connect dots on their own, they probably won’t be able to. But you should make sure that “if they see something, they should say something.” Just make sure that you and your team are setting aside some time to make those connections.

Now, with that as a little extra context, let’s return to the purpose of this activity: What can be done to overcome the complexity in your organization and create mechanisms for identifying threats?