Friday, December 18, 2015

The Paradox of Complexity

In business, complexity both drives innovation and also hinders it.

People are complex, business is complex, and the world is complex, and they are becoming more complex due to the explosive information and the accelerated speed of changes. Modern organizations spend significant time and resources to deal with complexity, is complexity good or bad; the complex organizational structure/process or the hyper-complex business ecosystem, which factors contribute the most to making organizations more complex? And philosophically, what is the paradox of complexity?

Complexity vs. Innovation: In business, complexity both drives innovation and also hinders it. When a business becomes overly complex and people get frustrated and annoyed by not being able to accomplish things easily, this drives the search for simpler concepts and methods, which is the need to take the innovative initiative. At the same time, over-complexity in a business may be hiding simple and innovative ways to achieve things because the people involved just don't get the time to step back from the complexity and hence, they continue to follow the old routine to do the things, lack of the out of box creativity. From the management perspective, there are needed complexities such as design complexity that competitors cannot imitate easily; or the collaboration complexity that makes people more productive and business agiler to adapt to the changes. Usually, innovation either through need seeker or technology driver is the key factor to weave such complexity in order. Therefore, a certain level of complexity is a foundation to spark the next level of innovation; and one of the very goals for innovation is to simplify the old way to do things, or to manage the complexity in an optimal manner.

Complexity vs. Intelligence: Complexity is a sort of intelligence from a scientific angle. Einstein said that every solution to the problem should be as simple as possible, but no simpler. It means that a problem has an inherent, irreducible complexity; any attempt to simplify further than that will fail and any complexity added to it is harmful. Then where does the complexity manifest itself in the intelligence process? It is the brain's ability to preliminarily understand the extent of any problem or condition. The people with what being referred to as highly intelligent have a strong aptitude to understand the "complexity" of the given problem. It's like a rating scale of complexity. Some people get the whole picture as opposed to others that can't seem to get a grasp on the problem. Intelligence is the ability to break any complex thought or problem to the most rudimentary parts whereas they either can be acted on or dismissed. It is the level of activity in either case or the means of which activity or lack of activity or alternatives that demonstrate levels of intelligence.

Complexity vs. Business Value: So complexity per se is neither good nor bad, or it can be either good or bad depending on circumstances. Some problems are simple in nature; others are complex. Complexity is diverse, ambiguous, and dynamic with unpredictable outcomes. It is often erroneously confused with the term complication. Nevertheless, complexity and complication do not mean the same thing. Something that is complex is not necessarily difficult, but something that is complicated does have a high degree of difficulty. The complication is the opposite of simplicity, and thus, it needs to be optimized to make it simpler. But organizations "become complex," as an evolutionary trend, not for their own amusement, they do it to respond to environments more proactively. And much of that environment is experienced by trying to get things done. One form of trying to get things done is the incredible daily difficulty of the creation of pathways for action. There is something more fundamental that plays a causal role in fostering greater organizational complexity.

So complexity is one of the key characteristics of digitalization, on one side, the greater organizational complexity can improve agility to adapt to the changes; on the other side, the undesired complexity can make things over-complicated to stifle the creativity. The leaders and managers just have to understand the multifaceted complexity via paradoxical understand, and manage them systematically.


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