On Complexity and why it's not that bad

The word complexity has been heavily used recently to describe today’s conditions. Things are becoming more complex due to an ever increasing connectedness, the world’s entropy is increasing. In the business world we hear a lot about removing, reducing complexity, streamlining things.

First of all let’s define complexity as a sum of the behaviour of system components. It has its own science “science of complexity” and its Mecca is the Santa Fe Institute. The interesting thing about studying complexity is that it gives a framework to understand systems as a collection of behaviours. As opposed to mainstream science which study subjects by discipline (physics, medicine, economics…), complexity science is interested in the level of interaction. This explains why complexity scientists work on a variety of subjects: the immune system, brain, ant colonies, ecosystems, and so on… Understanding how these complex system, also coined complex adaptive systems, work is key to building sustainable organisations. However there is a legacy of more than a century of the efficiency quest as popularised by traditional economics theory which regards economics and organisations as machines subjects to optimization and engineering and in which complexity is an issue to get rid of. After the industrial revolution, many economists have used physics and Newtonian concepts and applied them to economics and organisations. While this has served in a low complexity environment, today it is becoming clear that organisations are facing a complex environment in which planned machines are more of a liability.

We used to hear in business schools that companies need to develop a 3 to 5 year strategic plan to achieve a vision communicated throughout the organisation. Operational and support functions alignment would follow suit. It seems logical, rational as with a machine. This however is not the ideal design in a complex and ever changing environment. One example to illustrate the case is that strategy starts with the environment scan whose results are fed into the organisation to develop strategic options. Assuming that during the scan the company has access to all relevant information about the environment in which it operates (which is not true in almost all cases but we assume this for the sake of the example), proper strategies are then developed and implemented which takes several months even years and a lot of resources. As the environment is a lively and complex animal, future and frequent changes are not easily integrated into the strategy and this engenders strategic shifts. In this context complexity is perceived as threat to the organisation and as we can still reduce internal complexity, we have no power to influence external complexity and even if we succeed to do so, it’s a recipe for failure as it leads to a mismatch between internal and external complexity.

So what the solution then? Setting up an organisation as a complex adaptive system which is able to adapt to its changing environment at a specific scale (very important), while at the same time use machine-like concepts to low complex environment to take the most out of streamlining and optimization. This obviously starts with the evaluation of the level of internal and external complexities. This way companies will recognize and capitalize on complexity to generate value and succeed in adapting to murky conditions.

Complexity is a fertile ground for tinkering and innovation. It’s the best remedy for inequality of status and resources. It helps the weak get stronger and strong get weaker hence vertical mobility. It should be espoused and whose power harnessed. It’s one of the best thing out there to thrive.