GUEST POST from Greg Satell

Leaders need to make decisions and we rarely get to choose the context. Most often, we need to take action without all the facts, in a rapidly changing environment and a compressed time frame. We need to do so with the knowledge that if we get it wrong, we will bear the blame and no one else. It will be our mess to clean up.

That’s a hard bridge to cross and many, if not most, are never quite able to get there. I think that’s why we admire great leaders so much, because they have the courage to take responsibility on their backs and be accountable, to inspire confidence even in an atmosphere of confusion and to point the way forward, even if they aren’t sure it’s the right direction.

The truth is that you can never really be certain until you take that step forward. The simple and inescapable truth is that to accomplish anything significant you need to travel on an uncertain journey. It is tautologically true that the well-trod path will take us nowhere new. We can never fully control uncertainty, but we can learn to lead through it.

How Things Get So Complicated And Uncertain

Generally, we prefer to operate with some degree of predictability, which is why we build structure into daily life. On a personal level, we create habits and routines to give us a sense of grounding. On a societal level, we create laws and norms, so that we know what to expect from our interactions with each other.

Yet in Overcomplicated, mathematician Sam Arbesman gives two reasons why uncertainty is, to a great extent, unavoidable. The first is accretion. We build systems, like the Internet or the laws set down in the US Constitution, to perform a limited number of tasks. Yet to scale those systems, we need to build on top of them to expand their initial capabilities. As systems become larger, they get more complex and uncertain.

The second force is interaction. We may love the simplicity of an iPhone, but don’t want to be restricted to its capabilities alone. So we increase its functionality by connecting it to millions of apps. Those apps, in turn, connect to each other as well as to other systems. Every connection increases complexity and makes things harder to predict.

These two forces lead to what Benoit Mandelbrot called Noah effects and Joseph effects. Joseph effects, as in the biblical story, support long periods of continuity. Noah effects, on the other hand, are like a big storm creating a massive flood of discontinuity, washing away the previous order. Uncertainty, for better or worse, will always be somewhat unavoidable.

The Problem With Simplicity

The most straightforward solution to complexity and uncertainty is to boil things down and make them more simple. Politicians are fond of highlighting the thousands of pages pieces of legislation contain, because complexity is widely seen as a fatal flaw. “If it was thought through clearly, why couldn’t it have been devised more simply?” is the implication.

Yet while we yearn for simple rules, those rules often lead us astray. As Ludwig Wittgenstein explained in his rule following paradox, “no course of action could be determined by a rule because every course of action can be made out to accord with the rule.” Simple rules tend to be necessarily vague, which limits their usefulness.

Something similar happens when we try to tame complexity by summarizing it through identifying patterns. Random points of data, if there are enough of them, will always generate patterns as well, so we can never be quite sure if we are revealing an underlying truth or just creating a convincing illusion. To discern between the two is, unfortunately, complex.

In Why Information Grows, MIT’s Cesar Hidalgo explains that it is through emergent complexity that we create value. To understand what he means, let’s take another look at an iPhone. Its simple design belies incredible complexity, not only in the technology it contains, but in what it connects to, a complex ecosystem of apps, servers and data.

Steve Jobs didn’t intend to create an App Store, because he wanted to keep the iPhone simple. However, eventually he was convinced that by limiting complexity he was curtailing the potential value of his creation and, ultimately, he relented. It is through managing complexity, not avoiding it, that we can most effectively impact the world.

Narrowing Scope And Limiting Variables

The Franciscan friar William of Occam is best remembered for Occam’s razor, which he didn’t exactly invent, but did much to popularize. The technique, which is often mischaracterized as “the simplest solution is often the best,” actually had a lot more to do with variables and assumptions, which he advises to keep to a minimum.

It’s an interesting distinction that makes a big difference. William wasn’t advising us to ignore complexity, but to avoid increasing it by injecting things that don’t need to be there. We can acknowledge the messiness of the world and still tidy up our little corner of it, by narrowing our scope and limiting the variables we deal with.

Steve Blank advises startups to develop minimum viable products to test assumptions, rather than investing resources into a full-featured prototype. The idea is by narrowing scope you can get a better idea of the marketplace and then increase complexity from there. In our work helping organizations drive transformation, we advise our clients to start out with a keystone change, rather than rolling out everything all at once.

Whatever strategy you use, the key, as William of Occam pointed out long ago, is to limit variables where you can, while still recognizing that the universe is far more complex than our scaled down model of it. Or, as the statistician George Box put it, “all models are wrong, but some are useful.”

Innovation Is Exploration

The truth is that uncertainty is only a problem if you try to control it. The framers of the US Constitution designed it to be a guide, not a blueprint. That’s been the key to its success. They recognized it would have to evolve and grow over time and designed a system of checks and balances to curb the human potential for malice.

We need to start thinking less like engineers, designing just the right combination of levers and pulleys to account for every eventuality, and more like gardeners, seeding and nurturing ecosystems, pruning as we go. Gardeners don’t need to know the exact outcome of everything they plant, but can seek to improve the harvest each season.

In a world driven by networks and ecosystems, we can no longer treat strategy as if it were a game of chess, planning out each move with near perfect precision and foresight. The world moves far too fast for that. By the time we’ve put the final touches on the master plan, the assumptions upon which it was made are often no longer true.

Rather, we must constantly explore, widening and deepening connections to ecosystems of talent, technology and information. That’s how we uncover new paths that are often unseen from our usual perch and leverage complexity to our advantage. Breakthrough innovations arise out of unexpected encounters.

The next big thing always starts out looking like nothing at all. Today, competitive advantage is no longer the sum of all efficiencies, but the sum of all connections.

— Article courtesy of the Digital Tonto blog
— Image credits: Pexels

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