fuchsbau

Organisationen #7: Six Simple Rules: How to Manage Complexity without Getting Complicated, Yves Morieux & Peter Tollman

(back to books)

---

• Substrat: foster autonomy and cooperation to handle complexity
• Complexity: business complexity is 6x 1955 levels (25-40 requirements vs. 4-7 in 1955)
  • 15-50% of requirements are contradictory, e.g. "high quality and "low prices"
  • reasons for requirements growth:
    • 1) higher customer market power (through lower trade barriers & technology advances)
    • 2) more stakeholders (more regulation, more ethical considerations, etc.)
• complicatedness: negative organisational overhead (e.g. structures, procedures)
  • top 20% most complicated organisations: >40% of manager time with reports, 30-60% in coordination meetings
  • complicated organisations have fragmented view of competitive landscape
• hard vs. soft approach: two insufficient solutions
  • hard approach: respond by adding structure ("root-cause by absence")
    • examples: 'We are not innovative enough because we have no innovation strategy.', 'Our trains are late because we have no punctuality function.'
  • soft approach: respond by adjusting mindsets (root-cause in personal traits)
    • example: 'To change behaviors, you must first change the mindset'
• 6 rules to handle complexity: combination of autonomy and cooperation is key
  • adjustment costs: autonomy requires rework; cooperation requires compromise.
  • 1-3: create individual autonomy (relevant knowledge, room for maneuver, power)
    • 1) Understand what your people do, 2) Reinforce integrators (they foster cooperation for company benefit), 3) Increase total quantity of power
  • 4-6: create cooperation (feedback loops without extra structure or metrics)
    • 4) Increase reciprocity (e.g. by setting Rich Objectives, eliminating monopolies), 5) Extend the shadow of the future (e.g. tighten feedback loop with higher interaction frequency), 6) Reward those who cooperate.
• goals: most effective way to change people's goals is to change available resources
• behaviour: more effective to change context instead of mindset
• remove managerial positions if they have insufficient power to influence the context
• minimise rules to let managers effectively exercise judgment