Platt Perspective on Business and Technology

Finding and managing the right simplicity complexity balance 1: starting a new series

Posted in strategy and planning by Timothy Platt on April 3, 2012

A little over a month ago I posted as a 14th installment in a series on committee best practices: a piece on adding the right levels and types of formal structure to meet committee charter needs. My focus there, as its posting title implies, was on finding what might be considered the Goldilocks point for functional and organizational structure. I have come to see this as a general issue, as one of the great unsung challenges that businesses face, and certainly as they grow, and begin to outgrow their current and perhaps even successfully longstanding business designs and practices.

• Businesses can continue with an organizational and procedural model that is too lean and simple to work for them, and goals and priorities-oriented opportunities can slip away as a result. Inefficiencies and reduction in realized competitiveness can leak in.
• On the other hand, yet just as tellingly, a business can burden itself with structures and operational complexities that do more to disrupt communications and effectiveness than they do to provide positive value.

And both situations can simply, slowly develop with time. And the same organization can in fact simultaneously find itself facing both of these predicaments, with leanness and simplicity where more organized structure and process would help, and with complexity in places where it just adds clutter.

Goldilocks of the fairy tale kept sampling to find the sweet spot between too hot and too cold, and too firm and too soft. This posting is about a need to monitor for business model and business model implementation sweet spots, and for where the organization has moved away from them. And the issues of too much or too little in one direction or other, can be found in virtually every aspect of a business and its management – no area or aspect of a business is immune to this. And I will add that the desired sweet spots for any given business change as it and its marketplace change and evolve. So addressing the issues I write of here have to become a standard and ongoing part of a business’ standard strategic due diligence.

Up to here, I have simply noted a general, and I add vaguely formulated problem area. The real challenge here and the purpose of this posting is to at least start a discussion as to how to actually do something about these issues. And given the complexity of the issues raised here, and the way different businesses, following different business models can face uniquely different details and types of detail here, I am writing this posting as a first installment in a new series.

My goal for the balance of this posting is to outline some of the general steps in the process of this type of strategic due diligence. In subsequent installments I will flesh this out in more detail, and in something like an operationally meaningful order. But first, the basic, orienting outline:

• You need to know where you are with your business, and for both its organizational structure and for its operational practices.
• That means knowing your organizational structure as it is actually followed in practice. Real world organizations frequently develop what amounts to informal and dotted line connectors that do not show on the official table of organization, and formally listed lines are not always actually followed as shown. This can happen as inexperienced or ineffective managers are bypassed and worked around so the people who report to them can get their jobs done. Even with really effective managers in place, this can happen when work flow demands patterns of communication and organization not envisioned when the formal table of organization was set up, and that the table of organization does not now support.
• Markets change and evolve and customer needs do. Supply chains form, evolve and disappear to be replaced by new partner business relationships.
• Products and services change and evolve and old ones give way to new – and necessary in-house patterns of communication and accountability are not always taken into account in the formal table of organization as they are adjusted in day to day practice by the people responsible to maintaining effective performance in all of this.

You also need to be able to measure and track efficiency and to identify where change might be needed. And you need to be able to implement change and in ways that do not disrupt, creating inefficiencies from your efforts to rediscover your sweet spots of competitive organization and function, and of overall business efficiency.

I am going to focus in my next series installment on the first set of steps in this overall process: assessment of where your business is now. I add that I am not writing this as a change management series, but rather as a discussion of a set of tools and approaches that can be taken to help insure that change management per se not become necessary. You can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.)

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