Disruptive technologies such as blockchain and ground-breaking business models including Uber, Airbnb, Facebook and Netflix have more in common than their reputation for shaking up the way we live, work and entertain ourselves in the 21st century.
They all spring from the minds of innovators who recognize the clear distinction between problems that are “complex” compared with those that are “complicated,” and adjust their thinking accordingly, says Rick Nason, associate professor of finance at Dalhousie University’s Rowe School of Business in Halifax.
Following a checklist won’t help businesses ‘think and manage’ their way through changes.iMrSquid/istock
Understanding that difference is at the heart of Mr. Nason’s new book, It’s Not Complicated: The Art and Science of Complexity for Business Success (The University of Toronto Press).
Complicated issues can be hard to solve, but they are addressable with rules, processes and systems, like the algorithms that place ads on your Twitter feed.
By contrast, complex tasks require creativity, instinct and savvy; there’s no step-by-step recipe that will tell you how to respond. Creating a video that goes viral is an example of complexity thinking, as are future-forward startups that look to fill a need that’s yet to develop.
“It’s only the complex tasks that need humans who can think and do and act in complexity,” says Mr. Nason.
He believes there is a significant competitive advantage to the person or company that embraces what he calls “complexity thinking” — especially in the age of artificial intelligence, where technology is quickly changing the work force.
“In virtually every field — finance, law, medicine, manufacturing, education, transportation, and yes, even journalism — the complicated tasks and issues are increasingly being managed by computers, robots and bots,” he says.
Yet too many of us reject complexity in favour of the formulaic appeal of complicated thinking. Schools and businesses reinforce the problem by rewarding individuals for following rules and solving problems, rather than challenging people to manage issues and think about what could be.
“Witness the amount of click-bait [especially the click-bait targeted at business professionals] that has in the title some form of ‘X steps to success,’ as if all we have to do to dramatically improve our lives is follow a simple checklist,” says Mr. Nason.
The danger is, though, that if you manage complex things in a business environment as if they are merely complicated, you’re likely to be setting your company up for failure.
There are no guidelines to help the hotel or taxi industry address the rise of Airbnb and Uber, for instance. Rather, it takes a willingness to “think and manage” their way through the changes, and employ a “try, learn and adapt” strategy along the way.
The book is written for those willing to break away from their complicated thinking habits.
Cutting-edge companies such as Alphabet, Facebook and Microsoft do this almost instinctually by rewarding workers who think outside the box and try things that may or may not work, says Mr. Nason.
Among traditional companies, it takes more work.
Managers, especially those who are more experienced, often have a “light-bulb” experience when the concept of complexity is explained to them, says Mr. Nason, who also acts as a business consultant.
“What is harder is to get them to trust themselves … and adopt complexity thinking habits and techniques when appropriate,” he says.