Forbes Article: Order In Chaos: A Business Approach

By July 20, 2020 June 17th, 2021 Blog Posts

To be disruptive, business managers must embrace a certain amount of strategic chaos, even as external factors pull them forever toward an ordered condition of consumer satisfaction. A business is an ecosystem, and it is also part of a larger encompassing ecosystem called the market economy. The complex dynamics of market activity make it possible for individual enterprises and products to come and go without causing long-term damage to the underlying economy or to participants on either side of supply and demand.

In general, a specific market within an overarching economy accommodates an optimum number of competitors serving consumers. Interaction among consumers and producers becomes at once a measure of efficiency and a catalyst for change. When there aren’t enough competitors in a particular market sector, the potential for profits tends to be higher, and shrewd entrepreneurs tend to start thinking, “I want some of that.” When a market is saturated with excessive consumer options, insolvency encourages companies operating on the margin to shut down.

Change is key to a healthy economy. Today’s market for photographic film is tiny compared with its predigital heyday, but photography itself is more popular than ever. If one business collapses, or even if all businesses within one sector collapse, it is because consumers discovered something better to do with their income.


Complexity Theory

Each business represents a complex adaptive system (CAS), as does each market sector in which businesses compete for consumer loyalty. Within a CAS, the system and its agent components continuously adapt to each other, evolving as a symbiotic relationship where the system’s current state constrains agency and those with agency alter the system to suit their needs.

Amid Industry 4.0, businesses face different kinds of organizational challenges. Those that compete well often embrace a flatter structure than the hierarchical corporations of previous centuries. Where veterans see chaos, upstarts see collaborative opportunity. More and more, economic equilibrium resembles a balance between chaos and order, an endless waltz involving infrastructure and innovation.

Such a dance is never linear, never the same from one moment to the next. A successful business manager will simultaneously resist temptations to control the creative process while ensuring that those who innovate stay within the bounds of established goals and ethics. The idea is to keep pushing limits without ever losing perspective.


All As It Should Be

For both the natural world and societal abstractions like economies, it is healthiest to exist along the event horizon separating symmetry and jumble. An organizational state of snafu is perhaps nothing to be feared, so long as the situation does not careen from normal to hopeless.

Unless suppressed by overenthusiastic control mechanisms of dubious efficacy, all enterprises function on this knife edge. Five-year plans are no more practicable for businesses than they are for governments. As boxer Mike Tyson once said, “Everybody has a plan until they get punched in the face.”

New regulations might undermine otherwise feasible goals. Competitors might introduce superior products. Employees might decide to pursue a different dream, and consumers might become indifferent or antagonistic at any time. There is no way to predict what a strictly enforced production regimen might do for a business. Flexibility and agility are indispensable qualities for entrepreneurial survival.

The question becomes how to innovate without losing cohesion and purpose. Planning is still important, as is strategy. In the thick of it all, though, tactical advantage comes to those whose primary strategy is a commitment to changing tack when the wind blows different.


Technology As Copilot?

A recent example of an agile response to an unforeseen circumstance is the widespread adoption of remote working in the wake of the Covid-19 outbreak. Central to this transformation has been technology for networking, file sharing and collaborative communication.

One takeaway from the early days of mass online employment is an apparent ability for technology to form the boundaries of team goal consistency, an operational limit up to which innovators can be allowed creative license. Remote workers are productive for up to 1.4 days more per month than office-bound colleagues, while the right combination of technology and organizational support can help them to be more innovative.

The machine learning core of intelligent adaptive technology represents a foundation for many new business models. But will machines ever become smart and autonomous, or will they always be repositories of human-derived information that are merely programmed to appear as intelligent workplace assistants?


Making Headway In A Storm

At the end of the day, there is no complexity theory magic bullet to slay all organizational challenges. Entrepreneurs hoping to evaluate its applications for future production and employment arrangements can take advantage of numerous tips that early adopters have recommended, including:

  • Simplify: Identify major performance bottlenecks and the contextual dynamics that cause them, and implement operational changes to facilitate improved communication and cooperative behavior.

  • Choose the right team for each initiative: Make sure projects have teams that can offer appropriate skills for the tasks at hand and that these professionals are critical thinkers who won’t shy away from sharing their wildest ideas in meetings or through enterprise collaboration software.

  • Focus on consumers: Most often, business problems don’t stem from competitor acrimony or vendor inadequacy, but rather from the business’s own failure to help consumers navigate an ever-changing marketplace.

Perhaps the biggest hurdle to overcome is the typical manager’s insistence that their control over production represents a singular approach to taming complexity. Complexity, however, needs no taming. Prepare for the next Industrial Revolution by planning to embrace the complexity of the individual’s creative process even as you minimize internal complications with help from next-gen technologies.

Link to the Forbes Article.

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