Organisational complexity stimulates the need for organisational problem solving, which can bring about two potential strategic responses: Sustainability or Resilience
Which have you chosen and is your decision causing deterioration, potentially overloading your resources to the point of collapse?
First, we would argue that an increase in complexity either happens to you (e.g. emergent market conditions) or you drive the increase (e.g. market seeking strategy); either way there is an increased demand on problem-solving capability/capacity. Problem solving requires a basic Cost/Benefit Analysis, does the benefit of the solution outweigh the cost of the energy and resource required to solve the problem? If the answer is yes, then apply energy (e.g. time) and resources (e.g. people) against the problem to develop a solution.
However, complexity driven problem solving increases the demands on already taxed energy and resource capacity, which, causes a reciprocal problem and increase the complexity of the original context. Also, true to the Principle of Least Effort, most organisations think in the short term and select the ‘easiest’ (dare we say, least expensive) solution for the quickest win – the consequence being that the problem is not necessarily solved, instead it merely slips into remission.
Sustainability then is built upon the ability of the organisation to maintain near view problem solving capacity/capability. Here’s the rub, in this view the Cost benefit Analysis will reach a tipping point, where the cost of energy and resources will outweigh the benefits of the solution (the demand on available energy and resources becomes saturated, causing deterioration and, if left unchecked, acceleration towards organisational collapse). Diminishing returns stress organisational resources further and impacts the ability of the organisation to recover or reinvent itself in the face of still increasing complexity (acting according to our ‘Resilience Proposition of the Minimum‘).
In our opinion, resilience takes a longer view, priming resources (e.g. HR and learning and development strategies – enhancing capability – or employing sensory networks to improve the speed of response/reinvention) to meet the needs of increased complexity or acquiring the resources with the enabling competencies to enhance dynamic, agile and adaptive capability – primed resources (people and systems) being more effective/efficient, thereby creating more energy (e.g. time) to deal with complexity.
Resilience moves beyond the treatment of the immediate pain to recognise the preconditions, the underlying causality, that inhibits the organisation’s ability to act. We assert that people, as the dynamic building blocks for agile and adaptive capability, require three things to enhance resilience, but Dave Snowden sums up the wider organisational conditions via his ‘seven characteristics of resilience‘. The challenge for senior management teams is to overcome the ‘Principle of Least Effort’, to see past higher initial costs in order to to reap higher value long term benefit.
Our argument, sustainability might work as a short-term organisational strategy, but resilience holds the key for the future.
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