One important thing we need to understand is that these revolutions change all our social systems, including the workplace, companies, markets, and society itself, into ''complex systems'' by increasing interrelationships and interconnections within those systems.
Before the Internet revolution, members of a workplace reported important information only to their boss. But, since the revolution, members can immediately share any information with all of the other members in the workplace via email or an intranet.
The same thing has happened in markets. Before the revolution, consumers could get important information about products and services only through advertisements in the mass media. But after the revolution, consumers became able to get information not only through mass media but also via Internet media — i.e., websites, blogs, mailing lists, bulletin board systems, and e-communities.
This increase in relationships and connectivity has resulted in an increase in the complexity of systems of the workplace, companies, markets, and society. Therefore, the fruits of the Internet and Web2.0 revolutions require that all managers learn ''complexity management'' from now on.
Five Tips of Complexity Management
So what is complexity management?
In brief, it is the ''management of an ecosystem,'' which is relevant in this context because a ''complex system'' always becomes an ''ecosystem.''
For example, in market terms, the ''iPod'' is not merely a ''single product'' information device, it is a ''products ecosystem'' that consists of information device, personal computer, Internet, digitalized music, music stored on the web, payment system, agreements on digital rights, and so on. In other words, Steve Jobs is not simply an excellent innovator of a product, but an excellent promoter of the evolution of a whole product ecosystem for music entertainment.
Accordingly, marketing managers must be able to consider, understand, and handle the product ecosystems in markets from now on.
Another relevant issue is the ''atmosphere and culture of a workplace.'' Before the revolution, a workplace was always a hierarchical organization headed by one leader. The culture of the workplace was often colored by the personality of the leader. But, due to the revolution, the typical workplace has changed to a ''f'lat organization'' that shares information equally. The culture of the workplace, then, is now a result of the delicate mixture of unpredictable chemistries between various personalities. It is, then, a kind of ''minds ecosystem,'' the notion of which was advocated by the sociologist Gregory Bateson.
Given this evolution in workplace culture, managers must learn to consider, understand, and handle the minds ecosystems in their workplaces from now on.
What, then, is the problem of the ecosystem from the viewpoint of management? And what should the new management style be considering the problem of the ecosystem? In short, we managers should learn the ''five tips of complexity management'' to aid us as we try to manage workplace, company, and market as a single ecosystem.
Let me briefly explain those five tips by using the example of ''market and marketing.''
Tip #1 — Find significant fluctuation!
Ecosystems are characterized by the ''butterfly effect,'' which is a metaphor about how the flapping wings of a small butterfly in Beijing could create a huge hurricane in Florida. In other words, ecosystems are often drastically affected by even a small change or fluctuation.
For instance, in a market, one customer’s unfavorable experience with a product or a service could very quickly lead to a terrible reputation for the company who provides it, because the customer could easily relate his experience to many other customers through a bulletin board system or e-community.
But, of course, we cannot monitor all such fluctuations in a market. Rather, we managers need to acquire an ability to detect the significant fluctuations among many insignificant ones. How can we do that? By utilizing the next tip of complexity management.
Tip #2 — Don’t analyze. Use intuition!
Ecosystems are very difficult to analyze because they are very complex systems. Therefore, the successful manager needs to acquire and use the ability of ''intuition.''
Up to now, marketing managers have been gathering a mass of data from customers to analyze the ''hidden needs'' of those customers. But from now on, it will become more important for managers to join an e-community and listen to the ''small voices'' of customers that describe dissatisfaction and complaints about products and services in the market. Accordingly, the important thing for marketing managers is not to try to analyze, but to use intuition.
In the famous movie Star Wars, Obi Wan Kenobi advises Luke Skywalker to ''use the Force!'' The same advice should be given to marketing managers from now on. But then, how can we acquire intuition? There is no easy answer. The best way to acquire it is to keep trying to use it in everyday business.
Furthermore, we must also understand the importance of the ''sense of wonder'' described by Rachel Carson. Thinking in those terms, this second tip could also be rendered as ''Don’ think. Feel.''
Because ecosystems can potentially be affected by even a small fluctuation, we cannot predict the future behavior of a system. So what, then, can marketing managers do? The answer is related somewhat symbolically by the words of Alan Kay, who is sometimes called the ''father of the personal computer'': ''The best way to predict the future is to invent it.''
One good example of this is ''pro-sumer development.'' ''Pro-sumer'' is a unique concept advocated by Alvin Toffler in his book The Third Wave, and it means a ''producer and consumer.''
In other words, pro-sumer development refers to a development promoted by the collaboration between a producer (company) and the consumer (user). Since the Internet revolution, many websites have been created wherein pro-sumer development is realized.
With such websites, there is no need to predict the hidden needs of customers. And so, from now on, marketing managers can create future products and services in collaboration with customers.
Tip #4 — Don’t divide the system. Handle it as a whole!
To create the future, marketing managers must understand the fourth tip of complexity management. And what is that? Not to divide the system, but to handle as a whole. We cannot divide an ecosystem in order to change only a part of it. Therefore, managers need to handle the whole system at once.
For instance, the iPod would not have been a successful creation if Steve Jobs had tried to innovate only one aspect — say, the information device — of the ''products ecosystem for music entertainment.''
So, how can we managers handle a products ecosystem as a whole?
The answer is ''alliance.'' In other words, by employing a consortium of different industries or a portal website operated by different industries.
Up to this point, marketing managers have been considering and handling only their company’s product and services. But from now on, marketing managers should consider and handle even other companies’ products and services in order to move and change the products ecosystem as a whole.
Consortia and portal websites are good strategies for realizing that aim. What’s more, they are a another good way to understand the hidden needs of customers, because we marketing managers are in some sense akin to a group of blind people touching an elephant; it is only once many managers of different industries get together and share their knowledge of customers that they can create a new holistic vision of those customers.
Tip #5 — Don’t try to control the system. Promote the emergence !
Once marketing managers try to create a project to encourage pro – sumer development or a project that involves a consortium of different industries, we managers should employ the fifth tip of complexity management: Don’t try to control the system. Rather, promote the emergence.
We cannot control ecosystems because ecosystems are always characterized by the processes of a living system — i.e., self-organization, emergence, and evolution. As such, the important thing is not to try to control an ecosystem intentionally, but to promote that process of self-organization, emergence, and evolution.
What is needed for managers to do that? Vision with ''Kotodama.''
Vision implies an attractive picture of the future, and ''Kotodama'' is a Japanese concept which means ''powerful words with spirit and soul to move people to think deeply and act vigorously.''
I have explained the five tips of complexity management in brief by using the example of ''markets and marketing.'' But the same tips are needed for the management of a workplace, because a manager in workplace must handle the most complex system on this planet, the ''minds eco-system.''
In my next column, I will further explain the tips of complexity management by using the example of ''workplace and company.''
