Thursday, July 22, 2010

Does your company need a Chief Complexity Officer?

The world is just getting too complex--we all see it in the workplace and our personal lives--everyday!  We just moved into a new house in February, and the previous owner was kind enough to leave us most of the Owners Manuals for everything related to the house--water heater, snow blower, alarm system, sound system, sprinkler system, etc.  What he didn't leave, we were able to find on the Web.  Being the compulsive, organized person that I am, I created an 8 1/2 x 11 manila folder for each piece of equipment in the house that required some sort of manual.  We are now over 40 folders.  Will I ever read them in their entirety?   NO.  Did I have to read some of them--absolutely--you almost need to be an electrical engineer to operate a home entertainment system nowadays.   Hopefully, I won't need to go deeper into the manuals unless something goes terribly wrong.         C'mon,   40 files to operate a house!

I will spare you the details about my monthly repeating health insurance payment through Quicken, the one that no one seems to be able to stop from repeating--Quicken, the bank, no one.  So, this out of date payment ( my insurance premiums have been raised multiple times since this started ) keeps getting paid every month unless I manually go in to cancel it, only for it to reappear the following month!  It's takes me less time to do a monthly delete of this rogue payment, much less time than it would take me to continue the battle with tech support.

The world is too complex, the world knows it's too complex, and it is totally unable to control itself.  Take for example, the story on NPR this week about the Department of Homeland Security (DHS).    DHS is responsible for providing briefings to 108 committees, subcommittees, and caucuses .

Michael Chertoff was quoted in the NPR story  ""We calculated that in 2007-2008, there were more than 5,000 briefings and 370 hearings," says Chertoff, who was secretary of the department from 2005 to 2009. That consumes an awful lot of time. But truthfully … most people miss the biggest problem. And that is that the direction you get from the committees tends to be inconsistent."

At the time of  9/11 DHS  reported to 86 such committees -- their goal after 9/11 was to reduce that number.  Nine years later the number is UP to 108.

My real concern is that all of this complexity adds to our collective vulnerability.   BP's complex engineering and management resulted in the Deepwater Horizon disaster, communication satellite failures result in millions of Blackberries going down, and our hyper complex financial system resulted in the recent recession.   It took me months to figure out what the whole credit default swap fiasco was all about.

How do we manage complexity before it totally overwhelms us?  Will we reach a tipping point when the benefits of our complex systems are outweighed by the vulnerability that they subject us to?   Will we reach a point when we finally have to actively start simplifying government, technology, finance, and our own lives.  I don't want to start sounding like Ted Kazcynski--but I am concerned.  Will we need Chief Complexity Officers (CCO) in our companies to manager our out-of-control complexity?  I think we will.  The CCO will be the one high level person, whose sole responsibility is to look at the big picture.   Look at the risk to benefit ratio of each new complexity that creeps into our operations.  We can either give complexity free reign, or start managing it.  We better make up our minds -- Soon!

What do you think?????

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