Complexity and the credit crunch II

Another view of the credit crunch is set out by Ralph Stacey in his most recent book Complexity and Organizational Reality: Uncertainty and the Need to Rethink Management After the Collapse of Investment Capitalism.

As usual Stacey challenges some of the main assumptions in management theory which are based on predictability and control, and that strategy arises from managerial choosing. Instead, Stacey argues the following:

Organisations are not things but patterns of interactions between people. In these interactions, and among other things, people develop imaginative constructs of ‘wholes’ such as ‘the market’ or ‘Lehman Brothers’. In telling the story of what is happening using these abstractions reality is covered over and people and what they are doing disappear from the tale. The constraints that we exercise over each other, or the power relationships, also largely disappear from the stories we tell about what is going on.

People do of course form intentions, make choices and implement strategies, but do so into a web of other people’s intentions and actions making the exact outcome unpredictable.

Grounds for emergence or radical uncertainty?

I was working with a group the other day who had come together to discuss how important it was to undertake projects and research that were more open-ended. In other words, if one is being genuinely innovative or experimental it is not possible to specify in advance where a project might lead, or what research might discover. There was much amusement that many funding application processes oblige project proposers to specify in advance that they will be innovative and how they will be, which to many was a contradiction in terms. If you can specify the innovation in advance then maybe it’s not so innovative. The discussion turned on how we could persuade people who funded such work that the importance of experimentation was in not necessarily knowing what you would find – not all research is about testing a hypothesis. Sometimes it is necessary to undertake projects to work out what the hypothesis could be.

We decided that partly we were dealing with risk, and then on further reflection we decided that we were working with uncertainty. So risk is something that we already know might be a problem and we would take steps to mitigate it. This is what we have insurance policies for. Uncertainty takes us into Donald Rumsfeld’s fourth realm of ‘unknown unknowns’: we don’t know what our project or our research will lead us to discover since we don’t know what we don’t know (to put alongside the things that we do know we don’t know, which might comprise some of the reasons we want to undertake research in the first place).

Management as hedgehog thinking

I was invited by a small organisation which had been involved for over a year in human rights advocacy work to join them for an away-day where they wanted to reflect on their practice and think about what to do next. With very few resources they had achieved a lot. They had encouraged a number of disparate organisations to work together, had hosted conferences and workshops, had set up meetings between colleagues in developing countries coming from the developing South to speak directly to decision-makers in embassies and in UN meetings, and had developed a credible news service on the particular set of interests that concerned them. They were working in an intensely political environment and needed to respond quickly and authoritatively. The particular issue they were concerned with was vigorously contested, and their ability to take action was based on the strength of the relationships they could form with others, on the recognition of their legitimacy but in a context where events could shift the potential for action very quickly and very dramatically.

The organisation which had invited me was at the point where a number of new funding organisations had recognised their achievements and wanted to fund their work. The employees and trustees thought it was time to reassess, and perhaps to make their working relationships more formal particularly if they were to accept new funding. The business department at a local university had offered them a couple of MBA students to work with them to develop a business plan and together they had worked out a draft which was offered to the meeting as something to discuss. The students worked hard on it and did their best to produce something that would be useful for this organisation, but what was interesting to me was the assumptions that had informed their thinking, which, since they had not yet graduated, were expressed in quite raw form.