Embracing Complexity

Adaptive management in a volatile and complex world

Dr Jean Boulton Visiting Senior Research Fellow, DSPS, University of Bath

Visiting Fellow, Cranfield School of Management Director, Claremont Management Consultants Ltd

April 2017

jboulton@claremont-mc.co.uk www.embracingcomplexity.com

Copyright © 2017 by Jean Boulton, Claremont Management Consultants Limited. Published and used by INCOSE UK Ltd and INCOSE with permission.

Agenda

1. Complexity theory:

– what is it

– how does it fit with/emerge from other scientific worldviews

– How does it fit with our experience

– Have we thought like this before?

2. So what:

– Understanding the context

– The pragmatic middle ground

– Working with the incommensurable

– Project management

– Organisation design

– Living life..

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Part 1

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What is complexity theory and why is it important?

The wrong science? Adopting ‘hard science’ as relevant to the social world

(a) Traditional mechanical science - Newton (b) Theory of gases and liquids (thermodynamics)

Things work like a machine - predictable, controllable, standardisable

Things move towards equilibrium, stay there. Entropy increases.

French enlightenment Theories of management Cause, measurement, evidence

Classical theories of economics ‘Free market’ ideologies

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‘this pure theory of economics is a science which resembles the physico-mathematical sciences in every respect’. (Walras, 1874)

Why it matters what science we adopt

Standardise Best practice Plan Cause and effect Economies of scale Reversible change But UK 23rd out of 24 numeracy, 24th out of 24 literacy (OECD, 2013) Current 50-60 year-olds score better than school children

‘Trust the market; freedom of choice. Self-organisation But no ‘trickle down’; increasing inequality; concentration of power; the powerful go unregulated/unaccountable. Income inequality – UK 28th out of 34 OECD countries. (OECD,2013) UK bottom of 37 countries in relation to difference in healthy eating between rich and poor children (unicef, 2016)

The machine view The ‘free market’ view (equilibrium thermodynamics, natural law)

Complexity – not too tight, not too loose

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Why it matters what science we adopt

Standardise Best practice Plan Cause and effect Economies of scale Reversible change But UK 23rd out of 24 numeracy, 24th out of 24 literacy (OECD, 2013) Current 50-60 year-olds score better than school children

‘Trust the market; freedom of choice. Self-organisation But no ‘trickle down’; increasing inequality; concentration of power; the powerful go unregulated/unaccountable. Income inequality – UK 28th out of 34 OECD countries. (OECD,2013) UK bottom of 37 countries in relation to difference in healthy eating between rich and poor children (unicef, 2016)

The machine view The ‘free market’ view (equilibrium thermodynamics, natural law)

Complexity – not too tight, not too loose

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UK most highly rated hospices out of 80 countries (2015, Quality of Death Index)

(c) in contrast... evolutionary science

Path-dependence.. the future builds on what is already there..

Emergence: the future cannot be known in advance

Things are systemic, interdependent. What sustains is the system /ecology best adapted to the local situation at the time. Change emerges locally and spreads (or not).

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Local detail matters; each situation is contextually-specific

Cooperation as much as competition

(d) complexity science – how physics explains evolution The science of open systems

Prigogine gave an answer to Bergson’s question in1947. He showed that for open systems, new order/patterns can emerge

This was the start of the science of complexity science.

Prigogine was intrigued by the question: ‘Why does life ‘mount the incline that matter descends’ (i.e. why don’t physics and biology agree) (Bergson 1907)

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(d) Complexity: the science of open systems

•Systemic: everything is connected •Context specific: each situation is unique, detail matters •Path dependent: history shapes the present •Episodic: change goes in ‘fits and starts’ •Limits to knowledge: emergence at ‘tipping points’

Complexity theory is how physics explains evolution –

-the importance of variation -A theory of change as dynamic and locally-emerging

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Its ontology is:

The nub of complexity thinking – a dance between patterns and events

Patterns – connectedness - emergences (institutions, culture, routines, laws, political norms, supply-demand curves, systems, archetypes)

Disturbances to patterns (events, chance, deliberate action, variations, shocks, shifting alliances)

The path-dependent

future systemic;

context-specific; path-dependent;

episodic; emergent;

Open Nonlinear Variation Dynamic

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Simplicity on the other side of complexity? Systems thinking?

Are these ideas new? Do they fit with our own experience?

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Has your life gone to plan?

What gets in the way?

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Interlude: has your life gone to plan?

The legacy of the past ‘Culture’ and economics of family/society/region How the broader context changed over time Unexpected and unintended consequences Personality

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Learning Actions of others Catastrophe Chance

What gets in the way?

Upon those that step into the same rivers different and different waters flow…They scatter and …gather…come together…and flow away…approach and depart Heraclitus

Have we thought like this before?

Dao de Jing Within the rhythms of life, the swinging gateway opens and novelty emerges spontaneously to revitalise the world …..whatever is most enduring is ultimately overtaken

in the ceaseless transformation of things

Emptiness ‘there is no self-defining discrete reality to cause or effect. Forms or feelings are devoid of inherent existence; it is only on the basis of aggregation of subtle elements that forms exist; form can only be understood in relational terms to their constitutive elements.’. Dalai Lama explaining Milarepa Buddhist text, April 2008

The law of karma spells out that everything has its implications, everything makes a difference.. Every moment we are presented with the possibility of changing the future Lama Surya Das – Awakening the Buddha within

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What do these statements say about the nature of ‘reality’/experience?

Upon those that step into the same rivers different and different waters flow…They scatter and …gather…come together…and flow away…approach and depart Heraclitus

Have we thought like this before?

Dao de Jing Within the rhythms of life, the swinging gateway opens and novelty emerges spontaneously to revitalise the world …..whatever is most enduring is ultimately overtaken

in the ceaseless transformation of things

Flow (becoming), emergent patterns, path dependency, episodic change

Emptiness ‘there is no self-defining discrete reality to cause or effect. Forms or feelings are devoid of inherent existence; it is only on the basis of aggregation of subtle elements that forms exist; form can only be understood in relational terms to their constitutive elements.’. Dalai Lama explaining Milarepa Buddhist text, April 2008

The law of karma spells out that everything has its implications, everything makes a difference.. Every moment we are presented with the possibility of changing the future Lama Surya Das – Awakening the Buddha within

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The connections between scientific worldviews – back to the future

The Pre-modern worldview flow, becoming, patterned yet dynamic interconnected.. Empirically-derived

The Modern worldview - the machine predictable, stable, separable, objective, cause-and-effect. Ascendance of reason and theory-driven

The Post-modern scientific worldview contingent on the detail, local, patterned yet dynamic, becoming Modelling and empirical

complexity

indeterminism

evolution

phenomenology

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The core of complexity (i) ...

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Systemic Path dependent Context-specific Emergent

The core of complexity (ii)

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Incommensurability... There are no easy answers... Working with one pole leads to one-sided solutions...

Freedom versus Equality Efficiency versus Adaptability Standardisation versus Context-specificity Short-term versus Long-term

Part 2: implications for organisations in a VUCA world

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So what do you do differently?

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1. Understanding the context

2. The pragmatic middle ground

3. Working with polarities/paradox

4. Project management

5. Organisation design

6. Living my life...

1. The complexity framework: analysing contexts/environments ...and organisations

The future – Emerging weak signals of change Fore-sighting for critical junctures

macro

meso

micro

The past – History – events, people, economic and political conditions, social norms,

The present Wide-ranging interconnected PESTE factors – round and round Macro to micro – up and down

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2. The pragmatic middle ground

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Performance management The Frome share shop.. Frome health connectors..

3. Working with paradox/polarities

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Incommensurability... There are no easy answers... Working with one pole leads to one-sided solutions...

Freedom versus Equality Efficiency versus Adaptability Standardisation versus Context-specificity Short-term versus Long-term

What do you see

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How we think ...?

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Divergent (right-brain) and convergent (left-brain) thinking

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1. Find ways to shift scale – bigger and smaller, brainstorm, widen the context,

2. Look (using right brain) for themes/unobvious connections

3. Link things up/map 5. Look for leverage points

6. Work out some things to try

4. Work with ‘polarities’

Polarity Exercise for finding win-wins in either-or issues

Best of Both Worlds

Worst Case Scenario

Upside Upside

Downside Downside

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4. Project management – through lens of complexity

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Aspire

Anticipate

Adjust /attune

Adapt

As well as..

Plan, structure, roles, review

Savings groups

5. Organisation design

structure process (formal/informal)

Fit for purpose organisation for the VUCA world Reflecting the legacy of the past - constraints and opportunities

Balancing differing foci (cost, service, innovation, market dynamics, values)

With the future in mind – (foresighting, future proofing)

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culture people

The organisation as a system

Organisations issues

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Power in the tangible (easily measurable), not the intangible The structure should facilitate the working processes not vice versa Where are decisions made and by whom? Ambiguity can be minimised...

BPR, simultaneous engineering

6. What complexity means to me...

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If the future is not entirely knowable (albeit not random) then the end cannot justify the means. Each action contributes towards the system, adds to the shaping of the future... So what we do and our values and intentions is what enters ‘the system’ and shapes the future.. Seed the system with good ingredients....

What does complexity mean for me as an individual?

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•Thinking more widely and broadly (including about past and future) •Embracing diversity – working appreciatively and to share power and build trust •Mindfulness; the Devil is in the detail.. •Humility and yet feeling empowered – it may be me that tips the balance; experiment •Authenticity; what you say and what you do each enter the system

He who would do good to another must do it in Minute Particulars: General Good is the plea of the scoundrel, hypocrite, and flatterer, For Art and Science cannot exist but in minutely organized Particulars. William Blake

Conclusion

We’ve adopted the wrong science to understand the social world.

Complexity science provides a better

‘fit’ with/description of/worldview

for the social and natural world.

It emphasises the middle ground – between overly managing/specifying and laissez-faire, and reminds us that most issues of significance have no easy answers.

If we ‘Embrace Complexity’ we will do a better job of managing our lives/organisations/the planet than if we hope it will go away...

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