Every day, the universe becomes more complex. Moreover, the rate of change is accelerating, so the pace of commerce and globalization only adds to the complexity we must manage.
This increase in complexity has a direct effect on the formulation of strategies. We devise strategies to pave the way for our organization’s market dominance and the prosperity of our employees.
Developing strategies, particularly long-term plans, is essential to the success of any organization. Therefore, these strategies are typically developed by the C-suite and other executives. Ultimately, those at the summit of the organization have the most comprehensive view of the business, correct?
Most likely not. The reality is that not everyone is wired to devise viable strategies that account for the complexity of the global environment. It is a rare talent, despite the fact that countless individuals claim to be strategic. And it may be time to replace the team members on whom you rely to develop your strategy.
An Ambiguous Environment
The foundation of any sound strategy is a thorough familiarity with the environment in which it will be implemented. This is where your plan will be shown.
Find people within your firm who are adept at systems thinking if you want to create a realistic image of the market. Strategic planning begins with a focus on systems.
Simply said, you can’t have an accurate picture of your market without factoring in price, competition, regulation, technology, and human capital—and how these factors depend on and interact with one another. If you want your approach to work, this chaotic brew must serve as its foundation.
This is an extremely challenging undertaking that has grown increasingly difficult to complete as the complexity of the planet has increased. It used to be simpler when the rate of change was less rapid. It was usually possible to correct for minor deviations.
However, such is not the case now. If you want your approach to succeed, you need to give the outside world a reliable way to evaluate it.
The more accurate your internal representation of the environment is through the application of systems thinking, the more effective your tactics will be.
Systematicians Are Needed
But at this point, we must face the obvious problem. Systems thinking is not a strength of the average person. There is a significant gap between a person’s IQ and their ability to predict the future course of a complex system with many interconnected factors and dependencies.
The more you can grasp these interdependencies across extended periods of time, the better off you’ll be. However, most individuals just aren’t built that way.
Let’s come up with a case in point. Let’s imagine you’ve decided to phase out traditional storefronts in favor of online marketplaces. How many employees on your team have the mental capacity to take in and absorb the plethora of concerns associated with this transformation, such as the need to adapt to a new regulatory environment, new personnel challenges, and new technological hurdles? There is a web of relationships between these problems, and they will not go away for a while.
As a leader, it is part of your responsibility to determine whether people of the team have the level of mental complexity and systems thinking necessary to create this image. It’s not a skill that can be taught, alas. You’re either born with it or you aren’t.
A part of the issue is that this competency isn’t typically associated with certain job titles. Your vice presidents may not share this temperament, while holding more senior positions.
However, hidden away in your business might be folks who excel at analyzing multiple moving parts. And it is up to you to track them down.
Find out who your organization’s top systems thinkers are and get them involved in formulating strategy from the start.
Strategy from a New Perspective
The most important takeaway is the importance of using systems thinking to map out a complex environment and your organization’s strategies for success in that context. However, not everyone possesses the abilities of a systems thinker, which is why many tactics fall short, particularly in the long run.
The more systemic thinkers you have on staff, the better off you will be when plotting your course into the future.
