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Ignore Context at Your Peril

September 30, 2020 | FEE Content, FEE Posts

 

by Bob Leonard and David Ross

 

“We believed that by opening ourselves to the wider world, we could harvest ideas that had so far escaped our notice, and in the process break free from company-centric ways of looking at technologies, markets and ourselves.” – Guido Jouret, former Cisco executive

 

In this turbulent time, the degree of ingenuity and foresight required to run an organization successfully exceeds the abilities of any individual or small team. As we have seen with the pandemic, there is a real risk of organizations being revealed as brittle in these new circumstances. Leaders are lying awake at night struggling to figure out how to solve these seismic problems, but aren’t applying the decision making techniques required for a VUCA world (i.e. seeking a breadth and depth of context to be better informed and therefore able to make better decisions).

 

 

You Can’t Shy Away From Uncertainty

 

Historically, leaders have been brilliant at solving linear problems, often immediately and instinctively… based on technical expertise and experience. But the world is now non-linear. Our problems are “wicked”.

 

Wickedness isn’t a degree of difficulty. Wicked problems are different because traditional processes can’t resolve them. A wicked problem has many contributing factors, is difficult to describe, and doesn’t have a straightforward solution. Our climate crisis is a prime example of a wicked problem. Conventional techniques are not up to the task of solving wicked problems.

 

Wicked problems often crop up when organizations have to face constant change or unprecedented challenges. They occur in a social context; the greater the disagreement among stakeholders, the more wicked the problem. In fact, it’s the social complexity of wicked problems as much as their technical difficulties that make them tough to manage. 

 

What happens when leaders are confronted with a “wicked” problem? Solving a wicked problem requires more time, effort, information, collaboration, bridging of different perspectives and a tolerance for uncertainty, and there will likely be a number of potential solutions… each having unique pros and cons that must be thoroughly understood.

 

You Can’t Deny a Disruptive Future

 

The conventional “set the goal; plan; execute the approved plan” approach clearly is not suitable for today’s challenges. We need to embrace a “context-mindful” framework. Strategy is about evaluating options and making choices. We consider trade-offs, quick wins, absolute priorities, acceptable losses and other aspects. These decisions cannot be effective without researching and considering the context in which they will be deployed. The context is rich with information that can be leveraged to lead us down the path to effectively managing a strategic issue.

 

Rushing to make decisions without understanding their context can have critically adverse consequences. Leaders / corporations must be strategic at asking the right questions of the right people, internally and externally, and employing the right tools to understand their context. NOTE: We will investigate these tools in-depth in a future article.

 

Confronted with a linear, technical question, leaders have resources – data and subject matter experts – to help them form solutions. Typically, there is a single optimum solution. An example would be fixing a quality problem to keep a production line up and running. That might be a complicated problem, but it is not a wicked problem.

 

When a corporate leader must find a solution to a problem that his/her organization is facing, they try to find a rational answer by gathering data. The data is gathered, then analyzed, and then a relatively small group of individuals, usually with similar interests and perspectives, makes an ostensibly rational decision. They announce it and expect all affected stakeholders to support it. No single mind, or small group of minds, can encompass the full array of information needed to solve a wicked problem. Yet, that’s often the way organizations approach these problems.

 

Today, organizations are facing complexity like never before. They need to be agile and to move quickly… yet most are hidebound. They do not encourage the experimental or truly collaborative mindsets required. Data is historical. It cannot predict. The past no longer foreshadows the future, particularly when grappling with the momentous rate of change now experienced. Risk aversion stifles new ideas.

 

Organizations can’t develop working models of the environment in which they operate… the environment is too complex. As a result, contemporary strategic-planning processes don’t help enterprises cope with the big problems they face. Many CEOs admit that they are confronted with issues that cannot be resolved merely by gathering additional data, defining issues more clearly, or breaking them down into small problems. Their planning techniques don’t generate fresh ideas, and implementing the solutions those processes come up with is fraught with peril. That’s because many strategy issues aren’t just tough or persistent—they’re wicked.

 

Corporate leaders often lack the context to understand complex situations… especially if the situation resides at the edge of the organization. This can lead to naïve questions and ineffective recommendations.

 

You Can’t Avoid the Things that You Don’t Know

 

Wicked problems require an iterative approach leveraging a diversity of stakeholders with differing perspectives, experiences and skills. This is a much more complex leadership challenge. A wicked problem may seem to resist being solved… morphing as more information concerning it is unearthed revealing interconnected systemic issues. In fact, instead of trying to “solve” a wicked problem, a better approach is to tame it… to determine how best to cope with it and to discover the opportunities inherent in it. 

 

Collective intelligence is a valuable asset when assessing the potential unintended consequences of wicked solutions. A larger group of people who have been cherry-picked for their knowledge and experience in different facets of the problem or opportunity, who are then educated on the issue, has a much better chance of delivering a solution that not only tames the problem, and avoids unintended consequences, but often includes unforeseen opportunities. This method of managing strategic issues takes more time and effort, but helps to avoid major business blunders.

 

The challenges organizations face, like our climate crisis, are embedded in complex always evolving systems. If we don’t understand the fundamental shifting dynamics of our VUCA world, we cannot determine how best to address them. Organizations must leverage the everyday genius and expertise of a diversity of key stakeholders with a wide variety of experiences, skills, talents and ideas.

 

A better understanding of context not only informs leaders, but also enables better decision making. Right now, companies are making investments in technologies that can more closely link their people to each other, to customers, and to other stakeholders. Yet many companies struggle because their cultures get in the way — too many layers and silos, too many colleagues who prefer to stay in their comfort zones, bask in their KPIs, and resist new ways of connecting and working.

 

You Can’t Subscribe to the Old Assumptions that Defined Your Past

 

When an organization confronts a large number of novel problems, a top-down structure can become a choke point. As issues are escalated, they pile up on the desks of senior leaders who often lack the knowledge or the bandwidth to make timely and effective decisions.

 

In a formal hierarchy, the power to initiate change is concentrated at the top. But by the time a problem becomes critical enough to capture the CEO’s attention, the organization is already running late. Leaders are insulated – organizationally, culturally and geographically – from the fringes where new trends often occur. And many senior executives are shackled by their own timeworn beliefs. Despite this, they are expected to strategize for the future.

 

Effectively addressing our climate crisis and other wicked problems requires constant innovation. The skills and experience needed differ wildly from those necessary to manage an existing business navigating relatively calm waters. Innovative ideas must not only be generated, they must be tested continuously as they are deployed. An idea may seem terrific on paper, but may not play out that way in reality. Successful innovation requires that ideas are pressure tested, and tweaked… adapted until an optimal solution is arrived at. But that’s not enough.

 

Innovation requires making decisions based on incomplete information… and sometimes killing an idea when it becomes clear it is unworkable for one reason or another. Decide to persist, pivot or abandon an idea based on the evidence at hand.

 

Testing and adapting a business idea until it works requires a high tolerance for uncertainty and risk. Natural innovators have a high tolerance for uncertainty and risk. Whether you unearth talent for innovation internally, or hire it from the outside, they must be fully accepted by stakeholders. Innovators perceived as renegades find it difficult to access the context they need – internal gatekeepers can make it impossible. The C-suite should publicly proclaim that these innovators are to be given access and resources because they are forging the path forward for the organization.

 

Key Takeaways

 

You can’t deny a disruptive future – you must learn to work with it.

 

You can’t shy away from uncertainty – you need to shape some clarity.

 

You can’t avoid the things that you don’t know – you need to include others who know what you don’t.

 

You can’t presume things will go back to normal – there is only disruptive volatility within which we must learn to thrive.

 

You can’t subscribe to the old assumptions that defined your past – you need to make some new ones… constantly.

 

In our next article, we will focus on determining what you need to know context-wise, who you need to ask, and how to form the questions.

 

 

 

 

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