Complexity has been a theme through many posts on {grow}, most typically connected with the word “STRESS!”
I had a fascinating discussion with one of my ex-professors about technological complexity and why it is often making business life more difficult, instead of easier. A fundamental idea we explored was that often, technological systems are implemented to try to make up for a loss of business experience. Let’s see what you think. Here’s an example, comparing two real companies I have worked with:
The case for experience
Company A is a mid-sized tech firm whose newest senior manager joined the company eight years ago. Most of the top executives have been in the same company, in the same market, for 20 years or more. Even during the recession, they have made it a priority to retain experienced managers.
Company A has a simple CRM system to keep their sales pipeline straight but for the most part rely on their cumulative industry experience and intimate customer knowledge to serve their market and respond quickly to opportunities. Do they rely on Twitter and social media monitoring to “listen” to their customers? No. They KNOW what’s happening because of their deep personal relationships. Their customers typically pay more for their services and demonstrate incredible loyalty due to these long-term bonds.
Now let’s turn to Company B. Over the past decade, this company has rapidly replaced people who fail in a job. So even an experienced “superstar” who goes into a new job and doesn’t knock the lights out right away is replaced by an outsider who has zero experience in the company and probably zero experience in the industry. Within a few years, only one out of their 12 most senior executives was “home-grown.”
Implications of tech versus experience
To make up for the rapid experience and knowledge drain, many of the new executives instituted their own management systems, often carrying over a familiar application from their previous company. Workers at Company B are almost constantly learning a new “process.” To make matters worse, if a rumor begins that an executive is on the way out, all progress comes to a halt because they know that the replacement manager is just going to change direction on technology again any way.
When Company B was faced with a contract negotiation with its largest customer, all of the managers who knew the customer and had been part of previous negotiations were gone. So they hired a consultant to build a computer model that considered supply, demand, competitor capacity, pricing scenarios and every possible angle to produce a can’t miss negotiation strategy. The result? Company B lost the customer entirely, an event the computer model predicted could not possibly happen. The computer couldn’t account for trust and business relationships.
Now I know there are a LOT of managerial problems with the Company B scenario I’m presenting, and obviously some level of complexity is inherent in any business. But the point is, too often we …
- Rely on software to mask over deeper management problems.
- Focus on data instead of information.
- Take comfort in analytics instead of common sense.
- Minimize the value of real business wisdom and (gasp!) intuition because we feel the latest tech hype must be infallible.
Most likely, relying on software in place of real business experience results in personal stress, bloated costs, wasted resources, and excessive complexity.
As you try to stay ahead of the mounting technological tsunami, perhaps it is time to pause and consider whether there is a true business case for that new app or if this is just an attempted quick fix to bigger problems.
What do you think? Does this idea about complexity make sense in your company and your life?
