Monday 29 July 2013

Drowning in complexity - how to simplify without being simplistic...

An independent survey of 1,293 HR leaders worldwide has revealed how complexity in today’s business environment affects key business indicators and the degree to which managers lack confidence in their ability to handle that complexity (Hat-tip goes to Jeremy Blain for the link).

Results show 60% of survey respondents indicated that they did not have full confidence in their organizations’ ability to manage complexity. As a result, complexity has a very significant impact on key business indicators such as sales revenue, employee productivity and motivation, customer loyalty, organizational profitability, and sustainable long-term competitive advantage.

As part-time fire-fighters (if the job has become full-time fixing, it becomes a whole new ball-park, another time) NAMs need to be able to absorb and factor in new trading issues – and since 2008, most issues are new – and bring in results, despite the distractions such as tech-induced data-overload and increasing layers of complexity…

This means being able to simplify, without making an issue simplistic.

For instance, your customer has just received a take-over bid, ‘out-of-the-blue’... First of all, nothing, especially a takeover, happens unexpectedly to those who are constantly on the watch for signals, and NAMs are particularly well placed pick up and place key signals affecting their major customer in context, better than anyone in either organisation.  However, such signals, as with other key issues, come buried in a mass of data and complexity.. The benefits of being able to anticipate and act  while others are awaiting the next press announcement, hopefully go without saying?

Essentially, a NAM can manage most complexity by searching for answers to the following questions, fast!

- What is this about?
- Where is it headed?
- How does it affect me?
- What should I do about it?
- How?

What is this about? i.e. takeover bid
Read wide and fast, a mix of mainstream media and blogs, combined with the views of key people in your network. Despite the appeal of various lines of investigation, resist and merely dig out facts relevant to your question, remembering that you are aiming at producing an ‘elevator pitch’ i.e. an explanation that can be put across between floors on a lift-ride (apologies for culture-mix, but lift-pitch does not quite express it)....     As the in-house expert on the customer you are going to be asked for a detailed strategic reaction minutes after the CEO has read the news…If you are not her first choice for a view, mmmmm….

Where is this headed?
Given this morning’s bid is already history, the only sensible place to play is in the future, while others indulge in ‘analysis paralysis’ and other clichéd approaches to making sense of something that requires immediate action…(your fire-fighter mode).

Think future in several time-frames to generate deeper insight. In other words, thinking laterally, what are the immediate consequence of the bid, 1 month later, 6 months on and finally a year later, and pencil in appropriate actions for each time-frame. Think through the various parties affected by the bid, say consumers, the customer and suppliers. Explore positive, minus and interesting aspects of the bid from the point-of-view of each party, all well established lateral thinking process...

How does this affect me?
You now have a pretty comprehensive grasp of the issue and its consequences, along with the anticipated views of those concerned. This should be sufficient to take a stance on the bid’s impact on you,  your company and your brands.

Converting everything into financial impact will then lend the exercise a little immediacy and urgency, if per chance the pace has slowed….

What to do about it?
Again many of the required actions will be obvious, again requiring financial fleshing-out and factoring into amended trade strategies (you simply need to have been at the receiving end of a single takeover bid to know exactly what happens, and what to do about it…)

A key element should be a risk/opportunity analysis assessing what could go wrong/right, and exploring impact on the business and chance of occurrence…fast.

How to do it?
Can take a little longer but outside experience, objectivity and contacts can save time, and lend some fire-power to your recommended actions…

So, five questions later, you have an outline trade strategy, and judging from the average 5 minutes that NAMs devote to KamBlog postings, it is still less than ten minutes since you heard about the bid…..

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