Dealing with growing complexity needs innovation ecosystem thinking and design

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Much of business today is caught up in managing short-term change that is growing in complexity and challenges across the business world globally. There is growing leadership and employee fatigue in managing rolling crises and not being able to adequately focus on the longer term, have that space to renew and in enough time as ideally liked. Disruption has been a constant at all organisational levels to adapt and adjust to worldwide events totally out of that organization’s control.

Following the pandemic, it has been hard to regain consistency due to staffing discontinuities and displacements, sourcing of raw materials, especially from China, their intermittency in availability and the general disruption of world trade. The war in Ukraine has only added more short-term crises in switching fuels, sourcing difficulties, changing supply chain dynamics, and generally readjusting the business operations in Ukraine and Russia to highly constrained operations or the loss/withdrawal need required by sanctions.

So the challenges in the past year have been highly focused on supply chain disruptions, plugging gaps in technology solutions that can provide solutions that can offer higher flexible, agile and advanced planning and production environments. The continued needs to keep moving towards securing a more sustainable future that reflects the need to become carbon neutral; net zero has needed a far more agile and adaptive approach.

As well as encourages thinking that is building a more robust circular economy to offset the immediate shortages but builds out a waste reduction mentality and recycling approach.

Yet disruption is increasing; we are in a volatile world of constant change.

Our systems today are highly stretched; they were built for a steady, repeating business and flexibility, agility, and adaptability have not been addressed in design or mind shifts. Consistently has been the norm.

Facing up tomorrow, well already today, is we are in a VUCA period- full of Volatility, Uncertainty, Complexity, and Ambiguity.

We need to change how we operate. My view is we need to move rapidly towards Ecosystems in Organization design. There is a pressing need to widen our partnerships and invest in a more open, trusting environment to share knowledge, reciprocate and be more collaborative. We must seek out and connect with multiple and unfamiliar partners to strengthen the shared ecosystem.

We need to combine internal and external resources with different approaches to innovation or business adaption to achieve an ever-growing appropriate mix of skills, performance and experiences to meet the complexity and challenges we all will need to face.

The mind shift requires more agile and flexible partnering arrangements to help the ecosystem to respond far quicker to changing market conditions, encouraging flexible partnering arrangements.

Today we need to think differently, resisting the urge to overemphasize the internal organization to find equitable ways to manage shared ecosystems.

We have a significantly narrow path to managing complex challenges.

As I mentioned earlier, we can’t manage as we have in the past; we must be far more adaptive, open, flexible and aware.

We not only need to manage the three challenges of supply chain disruptions, changing technology infrastructure and building resîliency and sustainability into the business, but we also have a set of challenges equally in need of a different organization design approach.

Here is NINE more business needs to adapt and tackle in new, responsive ways

  1. Markets are shifting- some global markets will protect and defend, discourage open trade and increase protection.
  2. Consumer demographics are changing. Disposable income is rapidly changing in a more inflationary and weakening group of economies; we are facing ageing populations in the West and significant parts of Asia, impacting what is offered or required.
  3. Regulations continue to change. The growing call for greater harmonization is met by fierce “pushback” from different communities. Manage this uncertainty of different regulations is hindering progress or restricting organizations
  4. Diversity and inclusion are becoming more sensitive worldwide and have political and societal challenges that often constrain and restrict. Freedom of movement is being challenged as regulation is imposed to deal with new and sudden crises.
  5. Tariffs and trading barriers seem to be getting more of the political stick and are shaped more by political views shaping what is appropriate or needed.
  6. Capital raising has entered a very different time. After the considerable easing of the money supply, we are entering a tighter one where interest levels seem to be rising, fueling inflation and building further risk into investment. Inflation is growing as a top issue to manage in the foreseeable future.
  7. A recession seems to be a growing possibility in some economies, if not in large swaths of the world and all that has in its implications, socially, economically and politically.
  8. The Energy Transition and Global Warming is a truly massive challenge in the complexity of achieving the level of change within the next 30 years. It will bring extremes in weather, disasters, shortages, and famine; how we respond must be far more coordinated, responsive, caring and orchestrated.
  9. Finally, I return to a VOCA period- full of Volatility, Uncertainty, Complexity, and Ambiguity in increasing frequency and in multiple ways, many totally unexpected that need a response.

I do not believe we can manage alone; Our common challenges are connected

Our futures are very connected. We need to change how we manage ourselves. We must not draw back and “look in”; we must reach out. The world needs to collaborate, co-create and cooperate more than ever.

We live in an Ecosystem; we need to recognize the value of designing and thinking in ecosystems in the way we set about business and managing globally

The more we understand ecosystem thinking and design, the more we can shape and respond more effectively in a changing world.

Linear thinking, being singly performance-driven in individuals, organizations or society, is not a sustainable future.

We live in a finite world of space, resources and the need to value and respect nature; ignore this we lose our ONLY ecosystem, our world.

Ecosystem thinking needs to be the new norm in how we think and design.

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