Complexity

A placeholder to continue some thoughts on complexity....

The drastic ultimate solution once suggested at a Communist Party Conference by Vladimir Kabaidze, General Director of the Machine Building Workshop who has been reported as saying ‘I can’t stand this proliferation of paperwork. It’s useless to fight the forms. You’ve got to kill the people producing them.’


Continual pressure for growth has driven most companies to both expand their product lines significantly and promotional activity in an effort to stimulate customer interest and gain share. One of the consequences of all this activity has been an enormous increase in the complexity of their businesses. Complexity tends to increase the fixed costs of conducting their business. Smart complexity can create meaningful differentiation that wins in the marketplace. unfortunately, that is less frequently thecase.

Complexity manifests itself in many forms affecting everything from the day-to-day operations of the business to senior management’s strategic plans. Economies of scale, scope and skills appear to be wiped out by ‘economies of complexity’. Many companies have expressed serious concerns about their capability to successfully manage complexity and have sought to simplify their business, retrenching to a stable portfolio of core products and processes. Others have attempted to manage complexity through systems, structures, procedures, complex organization, and group decision making. Managing complexity is a highly leveraged opportunity.