The business environment has become increasingly complicated, resulting in a web of technologies, data and processes that can be difficult to understand. At the same time, market conditions and working environments are evolving at an accelerated pace, making it imperative that businesses respond and make decisions quickly. To do so, they need to clearly visualize and understand their tools, data and systems. This requires a way to navigate the complexity and stay ahead of it.
Navigating business sunny puri complexity can feel like playing a precarious game of Jenga—could removing one piece cause the whole thing to come crashing down? Fortunately, while this may seem impossible to achieve, there are steps that organizations can take to clarify business complexity and keep their operations running smoothly.
Generally speaking, business complexity refers to the interrelationships among a company’s products, services, systems, infrastructure, management and more. This type of complexity increases as a result of rapid technological change, complex products and services, globalization, market volatility and more. The amount of work and resources required to manage the business also determines its level of complexity.
The types of complexity that a business experiences can be categorized as structural, emergent and sociopolitical. Structural complexity is often caused by a complex mix of products and services, multiple locations, different production processes and more. Emergent complexity occurs as a result of chaos and unexpected interactions between different systems, and sociopolitical complexity is the consequence of social and political issues that may interfere with the company’s business processes.
A company’s ability to cope with business environmental complexity largely depends on how well its leaders can differentiate between complicated and complex operating contexts. As noted, the tendency of many leaders to apply their leadership response to a complicated operating context to a complex environment exacerbates the complexity and leads to unanticipated outcomes.
Leaders captaining their enterprises must learn to overcome this natural propensity to commit these leadership errors by reframing what they see, rewiring how they think and reconfiguring what they do. In doing so, they can better anticipate and prepare for shifts in the complex business environment and avoid perilously plunging into the gaping chasm between complicatedness and complexity.