Navigating Complexity
Author: Michael Moriarty
Reading Time: 2 Minutes
The Situation
The ecosystems in which businesses operate are becoming increasingly complex, presenting challenges which can feel overwhelming. Technological advances are driving change at a pace which is hard to understand let alone keep up with. Geopolitics is destabilising globalisation and disruption of established business models is everywhere. Very few businesses are designed or culturally adapted to operate in such a difficult environment.
Understanding what is coming next, or even what is happening now, while trying to run day-to-day operations is presenting challenges which leaders and managers, through no fault of their own, are ill-equipped to deal with.
Considerations
A Changed And Changing Environment
If it ever was, it is no longer sufficient to create a product or service and sit back as it satisfies customers and creates revenues. Customers, be they individuals or other businesses, are increasingly fickle, and influenced by social media in unpredictable ways. The cost of changing supplier is negligible or low, undermining loyalty, and it is cheaper and easier than ever to bring new ideas to market and promote them. AI is in the process of shifting the ground we all stand on, with unknowable outcomes. Meanwhile, the political and regulatory environment is unstable and influenced in previously unimagined ways. All this in arguably the most febrile geopolitical context in decades.
The Demands Of Complexity
Complexity confounds grand plans. It demands a more iterative approach to planning, privileging clarity of purpose and organisational agility over detailed multi-year forecasts. This is not the same as ‘make it up as you go along’. Complex environments require experimentation. This means the disciplined application of intentional action to discover and then to try and shape a business’s context. This ensures the ability to react swiftly to circumstances, be it seizing opportunities or avoiding the pursuit of valueless courses of action.
By definition, complexity entails a lack of control; it is impossible to know all that we want to. This creates anxiety in both the individual and the organisation. The natural reaction to this anxiety is to double down on attempts to control what we can. Yet this only results in the loss of the adaptability and flexibility necessary to meet the demands of complexity.
Perhaps counter-intuitively, the most helpful approach is to delegate as much as possible to those on the front line. It is they who are most intimately connected to the evolving context and best placed to respond to it. The role of the centre is to make sense of what is emerging, create a coherent narrative that allows the organisation to understand what it is doing, empower those in contact with customers, suppliers and other stakeholders to make appropriate decisions, and adjust the work of the whole organisation to exploit successes.
This approach is challenging for leaders and followers alike. For it to work, it requires vision, shared understanding, excellent communication and above all trust.
Conclusions
Coaching Culture Creates Trust
Leading in complexity requires letting go of control; not all control, but more control than most feel comfortable about. This is not about abdicating responsibility, but empowering subordinates so that the business can respond appropriately and at pace to the challenges of its context.
Certain things need to be in place for this approach to work. Everyone must understand what the organisation is trying to achieve, they must understand their role in the whole enterprise, and they must be equipped with the skills and resources to deliver their role. Above all, they must be confident in the trust of their leaders and colleagues.
Trust Is Built On Knowledge
Trust is built upon personal knowledge. We must have confidence that a person is competent and skilled, and we must also be confident in them as a person. This confidence develops as we get to know each other, principally through conversations held over time.
A Coaching Culture is one in which conversations are designed to create and develop trust. They are free of judgment, they presume and develop competence, and they enable deeper relationships by requiring curiosity, careful questioning and profound listening. The creation of a Coaching Culture of trusting relationships and excellent communication throughout the organisation, allows it to reduce internal friction and unlock each person’s full potential with the result that it becomes much more than the sum of its parts. It becomes an organism in tune with its context and ahead of its competitors.
“Complexity demands adaptability and the ability to tolerate not knowing the answer”
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