Complex vs Complicated

Complex Problems Don’t have Complicated Solutions

Have you ever looked at a chart, diagram, or procedure and wondered – why is this so complicated? If yes, it’s likely an example of someone’s attempt to explain a complex system with a complicated method.

The words “complex” and “complicated” are often used interchangeably, which is part of the problem. It’s helpful differentiate them. Consider this comparison:?

?A quick scan shows that the first two rows, the system has multiple components and those components are interconnected, are the same for complex and complicated systems. This is likely the reason that people/companies get them confused? However, complex systems, unlike complicated ones, exhibit unpredictable behaviors.

Attempting to explain and therefore improve a complex system solely through detailed charts or procedures usually creates more confusion. To make complex systems robust, you must look beyond the more obvious characteristics (see rows 3 & 4 above).

Let’s illustrate the difference between complex and complicated systems by walking through each of these characteristics with some examples:

Product Development System (complex) – describes how a company develops new products

Order Fulfillment System (complicated) – describes how customer orders are taken and products are delivered.

Now let’s take a look at these example “systems” with regards to the above characteristics:

1. The System has Multiple Components:

Product Development System: Yes. Components include:

·????? Capturing customer insights

·????? R&D

·????? Manufacturing

·????? Management oversight

·????? Project management

·????? Etc.

Order Fulfillment System: Yes, Components include:

·????? Website

·????? Payment processing

·????? Inventory management

·????? Order picking

·????? Shipping,

·????? Etc.

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2. The System Components are Interconnected:

Product Development System: Yes. Examples include:

·????? Marketing figures out what the customers need and works with R&D who designs it.

·????? R&D works with Manufacturing to ensure that the design can be built.

·????? Management approves key decisions made by anyone on the team.

·????? A project manager works with Marketing, R&D, and Manufacturing to manage the timeline and budget for the entire product development effort.

·????? Etc.

Order Fulfillment System: Yes. Examples include:

·????? The website is connected to the payment processing system

·????? The website is connected to the inventory management system

·????? The inventory system is connected to the picking system

·????? The picking system is connected to the shipping system

·????? Etc.

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3. The System Components Behave in a Known Way and are “Solvable”:

Product Development System: No. For example:

R&D doesn’t respond the same way to every customer insight brought to them by Marketing. In a similar manner, management doesn’t respond the same way to every status report presented by the project manager.

The system component behaviors will change based on the specific situation at hand (including factors outside of the direct stimulus) and therefore, cannot be predictably modeled. For example, based on the design provided by R&D, Manufacturing may decide to outsource certain plastic parts or fabricate them in-house. This decision may be influenced by the design itself and/or factors outside of the specific product development project such as capacity at the in-house injection molding plant.

Order Fulfillment System: Yes. For example:

The payment processing system will charge the same amount each time a product is purchased. The website will transmit the same SKU to the inventory system each time a product is purchased. The inventory will be decremented by one unit as soon as the product is shipped.

The system behaviors are known, governed by very specific rules, and can be modeled by a computer algorithm.

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4. The System Evolves over Time:

Product Development System: Yes. For example:

The first new product developed using a company’s product development system may encounter issues related to timing, budget, product quality, etc.. However, as the company gains experience with the system they build skills and capabilities and subsequent new products will encounter fewer problems.

Order Fulfillment System: No.

In the absence of actually modifying the order fulfillment system, it will process customer orders the same way over and over again. The system will not evolve over time. Through training and experience people will make fewer mistakes, but assuming that they are following their procedures, the system itself will not improve.

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Conclusion:

A complicated system such as Order Fulfillment can be “solved” in that through software, processes, procedures, training, etc. outputs can be predicted with a high degree of certainty.

A complex system however, cannot be solved in the same way. In fact, trying to do so will likely lead to team and organizational frustration. To improve a complex system such as New Product Development you must frame the overall system, put boundaries in place, clarify the objectives and most importantly build the skills and capabilities to use the system.

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