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Esko Kilpi keynote at the LESS2012 conference

is complexity a myth?

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let’s look at what we do and how we think

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our mainstream management and organizational approaches are derived from the era of the

production of tangible goods and high-cost/low-quality communications

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physical tasks could be broken up in a reductionist way. bigger tasks could be divided by assigning people to different, smaller and fairly independent parts of the

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the division of labor reduced organizational effort and the cost of work in factory production

the division of labor also increased the quality of work through specialization

this led managers to focus on the efficiency of activities that were separated from other activities

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organizational design was seen as the planning and execution of a collection of independent, but connected

jobs forming the workflow system

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connections were based on top-down command-and-control and horizontal, sequential processes

in both cases the action of one part was meant to set off the action of another

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interaction was understood as one-way signals, a system of senders and receivers, a system of causes and

effects

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the big move we are in the midst of is towards an economy that is more centered on information

products than physical products

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for intellectual tasks, it is not possible to find independent parts because intellectual tasks are by default linked and interdependent, creating a totally

different work environment

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the characteristics of the new economy are different from what we are used to: the production of physical

goods was capital-intensive, leading to centralized management structures and shareholder capitalism

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now it is much more about finding brains than finding money. the good news is that you are not limited to the

local supply

work on information products does not need to be co-located because of the Internet

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decentralized action plays a much more important role today than ever before

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the architecture of work is the network and the basic unit of work is not a process or a job role but a task

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the opportunity we have is in new relational forms that don’t mimic the governance models of industrial,

hierarchical firms

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mainstream management mind-sets are not only unhelpful, but wrong in a world of widely distributed

value creation and ubiquitous, high quality connectivity

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how we think

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mainstream ways of thinking about management are based on the sciences of certainty

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the whole system of strategic choice, goal setting and choosing actions to reach the given goals in a

controlled way depends on predictability

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this familiar causal foundation cannot explain the reality we face. almost daily, we experience the inability of

people to choose what happens in their organizations – or in their countries

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we live in a linked and complex world

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complexity refers to a pattern, a movement in time that is at the same time predictable and unpredictable,

knowable and unknowable

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healthy, ordinary, everyday life is always complex, no matter what the situation is. there is absolutely no

linearity in the world of human beings

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the often-asked question is what causes things to happen

when we seek for causal explanations, we begin to split the world into independent entities. there are causes

on the one hand and effects on the other

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when we try to understand a person’s actions or try to understand what is happening, we search for an

independent set of conditions that bring these about

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this is why we search for the good managers and blame the bad ones. the manager is the independent cause – and deserves to be paid accordingly. the rest of us are

the effects30

from a social business standpoint the individualistic view is fundamentally misleading. one cannot be

inspiring or energizing alone

these qualities are co-created in an active process of mutual recognition

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an inspiring person is only inspiring by virtue of others who treat her this way

a good decision is only good if there are agreeable people around

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mainstream business thinking sees the self and its relationships based on cartesian philosophy; I think,

therefore I am

everything in management takes place from the first-person point of view

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cartesian isolation was strengthened in newton’s physics, where matter and also people, were seen

metaphorically as billiard balls, bumping against one another every now and then

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billiard balls don’t really meet

they don’t get inside each other and alter each other’s internal qualities. during a collision they may undergo a

change of position or direction, but they remain essentially the same

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this is why psychology and sociology are separate disciplines. this also explains why human capital and

social capital are seen as separate

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in the cause-and-effect model of communication a thought arising within one individual is translated into

words, which are then transmitted to another individual

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at the receiving end, the words translate into the same thought, if the formulation of the words and the transmission of those words are good enough

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so why are there misunderstandings?

in the model of complex causality, communication takes the form of a gesture made by an individual that evokes

a response from someone else

the meaning can only be known in the gesture and response together

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if I smile at you and you respond with a smile, the meaning is friendly, but if you respond with a cold stare,

the meaning may be contempt

gestures and responses cannot be separated but constitute one act

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what if you would think of services as gestures, or products as gestures...

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neither side can independently choose the meanings or control the conversation. thus you can never control

communication

you cannot predict

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complexity and the individual

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identity is constructed from being in relationships, being connected, as contrasted with the mainstream view of

identity through separation

knowledge of self and the other thus becomes viewed as co-constructed

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mutually recognizing and mutually supporting relationships are the sources of progress

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complexity and the organization

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organizations are creative, responsive processes of communication with the capacity to constantly self-

organize and re-organize

solutions are always temporary and contextual

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rather than an organization being though of as an imposed structure of separate, autonomous functions,

today’s organization arises from the interactions of individuals who need to come together

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actions always emerge in a network of relationships – in co-action instead of cause and effect

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an organization is a continuous process of organizing

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why this is important now

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the really big opportunity of social business is to reconfigure agency in a way that brings relationships

into the centre

it is about interdependence instead of independence

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the new competitive edge comes from openness and interactive capacity: the ability to participate and

connect, as and when needed

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when information is transparent, different people see different things and new interdependencies are created,

thus changing the organization 

the easier the access that people have to information and one another, the more possibilities there are

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there can be no change without changes in the patterns of communication

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organizations of any kind, no matter how large or how small they are, are continuously reproduced and

transformed in the ongoing interaction

these patterns are highly correlated with performance

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every human relationship serves as a model for what is possible. learning is the fundamental process of

socialization

within any relationship we are in the process of becoming

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leading and following in the traditional corporate sense have seen the leader making people follow him

through motivation and rewards. the leader also decided who the followers should be

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when seen through the logic of complexity and social business, leading and following have a very different

dynamic

leading in this new sense is not position-based, but recognition-based. people, the followers decide

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the leader is someone people trust to be at the forefront in an area which is temporally meaningful

for them

people also recognize as the leader someone who inspires, energizes and empowers them

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because of the diversity of contexts people link to, there can never be just one “boss”. you might even claim that from the point of view taken here, it is

highly problematic if a person only has one leader. it would mean attention blindness as a default state

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following is at best a process of active, creative learning through observing and simulating desired

practices

leading is doing one’s work in an open, inspiring and transparent way. leading is engaging with people and

being reflective

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patterns of recognition and patterns of communication are the most predictive activities there are in forecasting viability, agility and also

human well-being

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the conclusion

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there is a need for rethinking what management is and refreshing the theories it is built on

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the story continues

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please follow

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@EskoKilpihttp://eskokilpi.blogging.fi

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