In last month’s blog post, “The Challenge of Digesting Complexity”, we saw why organizations with high aspirations and an appetite for complexity often find it difficult to manage the complexity they seek to address. In particular we learned about these challenges through the experiences of HealthCare International (HCI), the composite nonprofit organization that represents why many nonprofits find it difficult to improve the world around them despite their well-intentioned efforts to embrace complexity.

In this post we will take a look at five strategies organizations can implement to manage or digest complexity, i.e. to work effectively with the interconnectedness their hearts care about and their minds want to understand. We will see that building the capacity to manage complexity involves both new perspectives and new behavior. In Part Two of this series, we will describe five additional tactics and tools organizations can use to embrace complexity.

The first three strategies entail thinking differently about complexity, collaboration, and productivity:

1. Thinking differently about complexity involves recognizing that social systems do not respond to conventional ways of connecting cause and effect. Instead they behave and evolve in non-linear and often non-obvious ways. Understanding this distinction reduces the resource waste caused by: 1) addressing long lists of problem symptoms instead of their underlying causes, and 2) investing in solutions that work in the short run only to be undermined by longer term impacts.

Thinking effectively about complexity entails:

• Learning how to lead systems change
• Developing skills in uncovering the root causes of chronic complex problems
• Appreciating time delay
• Recognizing the unintended consequences of proposed solutions
• Uncovering mental models that drive current performance
• Identifying high leverage solutions that improve system-wide performance in sustainable ways, and
• Integrating these leverage points into a carefully planned sequence of interventions over time.[i]

For example, managers and staff at HCI are engaged in an organization-wide program to apply the principles and tools of systems thinking to both internal and external change projects.

2. Because managing complexity requires increased collaboration, it is important to think about collaboration as an investment – not just as a good idea. Organizations which learn to think systemically are understandably motivated to increase collaboration across organizational silos and with external stakeholders. They come to recognize the value of integrating diverse views to achieve more sustainable solutions supported by strong coalitions. However, as HCI and others discover, these benefits do not come free. They come at the costs of spending more time on collaborative versus individual initiatives, building collaboration skills, and investing in the long-term process of developing mutual trust. When organizations consciously weigh collaboration’s benefits against its costs, they are more committed to make the investments required to convert the promises of collaboration into reality.

3. Because investments in collaboration increase long-term productivity, it is important to think differently about what makes people productive over time.[ii] The conventional assumption about productivity is that more effort leads to greater results, which leads organizations to adopt what we call a “can-do” culture that rewards hard work as an end in itself. By contrast, an alternative assumption about productivity is that more effort leads to greater results up to a point – beyond which more effort yields diminishing returns as measured by unmanageable stress, reduced work quality, time spent correcting mistakes, greater conflict, poor planning, and burnout. We call organizations that understand renewal as a critical success factor for results a “results and renewal” culture, and we see the development of such a culture as key to sustainable productivity.

We also recommend two additional strategies:

4. It is important to set and hold firm to a limited number of priorities. This is because the desire to embrace greater complexity tends to increase the number of organizational priorities beyond what people can handle; priorities tend to proliferate faster than our ability to fund them; and people’s abilities to work productively diminish with ever-increasing workload, Maintaining continuous balance between the number of priorities and existing resources requires the discipline to take current priorities off people’s plates when new ones are added. It also entails respecting people’s need for renewal by establishing the expectation of a limited work week so that people don’t feel pressured into take on more than they can handle. One strategy now employed by HCI to cultivate this balance is to set up an innovation pipeline which ensures that priorities don’t advance beyond the conceptual stage without adequate resources.

5. A fifth strategy to manage complexity is to use organization redesign to integrate certain functions and hence reduce the need for horizontal collaboration. Redesigning organization structure through centralizing or combining functions can create a focal point for coordination. At the same time, the increased efficiencies created by centralization need to be balanced with the greater effectiveness resulting from localized relationships with an often-diverse base of stakeholders.

In summary, five strategies help organizations embrace greater complexity: