Simplify Work

Crushing Complexity to Liberate Innovation, Productivity, and Engagement

Jesse W. Newton

• Publisher: Morgan James Publishing
• Year: 2018
• ISBN:
  9781642790832
• Topic: Economics
• Subtopic: Development Economics
• Index: Economics

In urgent response to the epidemic of crippling complexity affecting organizations around the world, Simplify Work reveals the common sources of this virus and outlines practical steps that can be taken to liberate innovation, productivity, and engagement.

Complexity is like a vine that gradually grows and expands, wreaking havoc in organizations and individual lives. Growing complexity has traditionally been met with added structures, processes, committees and systems. Consequently, organizations often become a complicated mess, clouding strategic focus, slowing innovation and breeding complacency. It is no wonder that large organizations around the world are failing at an increasing rate and employee engagement levels have never been so low. Simplify Work reveals the typical drivers of complexity and provides a practical method for simplifying work. Inside, global management consultant Jesse Newton delivers a newfound clarity on the case for simplification and the steps organizations and individuals need to take to unleash its potential. He reveals the common drivers of debilitating complexity and provides a recipe for reducing and removing those things getting in the way of peak performance. Based on the research and experiences of a recognized organization effectiveness expert, Simplify Work leaves readers inspired and equipped to create a new liberating reality in both their organization and their life.

CHAPTER 1

Bogged Down in a Spaghetti of Structure, Process, Systems, and Rules

An epidemic is affecting businesses large and small. This epidemic is debilitating complexity. The disease restricts innovation, limits productivity, disengages the workforce, and eventually leads to organizational failure. This book provides a cure for this disease in the form of a tested method for identifying, removing, and redesigning the things that get in the way of focusing on what is most important.

Debilitating complexity takes the form of unnecessary and complicated structures, processes, systems, rules, metrics, checks and balances, and so on. Businesses traditionally add more and more of these things as they grow. There seems to be an acceptance that as a business grows, complexity and complicatedness are natural by-products. And while complexity certainly does increase as businesses mature, it does not mean that it needs to stifle innovation and entrepreneurship. The same story plays out over and over again once a company gets to a certain size: the entrepreneurial leaders decide that their juvenile business is becoming an adolescent and want to be taken seriously, so they bring in an experienced “big company” professional. The big company person then sets about installing all of the “discipline” that a serious organization requires—defined roles and responsibilities, performance metrics, committees, strict common processes, and so on, and so on. Then, all of sudden, people begin adhering to their newfound role expectations, they start to get lost in all the processes and paperwork, they become scared to step outside of their defined role, and spontaneous rich innovation becomes a distant memory.

In a recent study 74% of respondents rated their organization as complex.¹ In this digital age, when technology is fueling rapid changes in consumer preferences and reshaping industries, it is critical that companies innovate well and fast. Companies that are bogged down in slow decision making, risk intolerance, and siloed protectionism are destined to fail.

The current complexity crisis is largely due to many organizations holding on to outdated and obsolete methods of organizing how work gets done. These 20th-century approaches to organization structure and management are strangling our productive and innovative potential. They are limiting the thinking power of our people and not effectively using the resources at organizations’ disposal.

From an individual perspective, how we protect and allocate our time and energy is becoming increasingly paramount. The most important resource people have is their time, and we are spending far too much of it on the wrong things. We are pulled in so many directions and have to spend so much time and energy navigating through a labyrinth of processes and structures that we have lost touch with what really matters. We simply do not have the time and energy to do our best work on the most important activities.

As we are working longer and longer on increasingly low-value work, we often don’t even realize it. We have become accustomed to the four approvals we require to do anything and accustomed to going through a leader to talk to someone in a different function. We’re accustomed to navigating through three separate systems to find the information we need, and we’re accustomed to dedicating a quarter of the year to complete the budgeting process. Let’s not forget about that report one of your leaders within the matrix needs; that clearly should take precedence over everything else.

Deep down we know something is not quite right. We are not spending quality time doing the work we were hired to do. We find that it is getting harder to stay on top of everything and enjoy a good balance or even a balance at all. This results in us simply checking out. Engagement scores across companies over the past 30 years have consistently decreased. According to Gallup, only 28% of the US workforce is engaged at work, the rest are either actively disengaged or merely not engaged.²

The implication for business is that things move too slow, people think and act in silos, it’s hard to get anything done, decision making is poor, innovation is missing, risk-taking is low, and it all leads to increasing costs and being left behind by more nimble competitors. But it doesn’t have to be this way. Advances in technology are enabling us to spend less time on low-value activities, both in business and on the personal front. With our smartphones we’re able to do so much that we weren’t able to do in years gone by. We can buy products, order a taxi, book a flight, keep track of your heart rate, and more. There is also the rise of the voice assistant, like Amazon’s Alexa. You can leverage this for anything from automating and simplifying weekly grocery shopping to controlling your music. The challenge is that most businesses have not kept up with these developments, so many people are still stuck wasting a significant part of their day doing low value, non-core activities.

Chaotic complexity exists in many organizations, from the private sector to nonprofits and certainly in government. There are many drivers of debilitating complexity, but a common one is the added structure, process, rules, systems, and so on that come with growth. As an organization grows, new business units are created, back-office services need to expand, and more layers are added to the structure. It can become a vicious virtuous cycle. As more departments are created, cross-functional communication weakens, resulting in coordinating groups being established, thereby adding to the spaghetti of handoffs, approval processes, and committees.

A recent example of an organization that has experienced this is GoPro. This innovative camera company experienced sensational growth over a decade and had a highly successful IPO in 2014. However, between 2015 and 2017 the company lost money most quarters. Where the wheels started to fall off for GoPro was the complexity creep that the company allowed during its explosive growth. The company, influenced by its fast growth and investor expectations, decided to create new business units to tap into new industry segments and foster continued growth. At one point they were developing more than 30 series of different shows that they wanted to post on a new streaming platform that they were creating simultaneously. They also were building new products, including a drone and an underwater camera. They went from 700 employees to 1,600 employees in 18 months. Budgets increased tenfold. With this expansion, the company went from a flat simple structure to multiple siloed business units. What was once a fast-moving entrepreneurial company became a complicated, lethargic beast. The company was losing its way. The founder and CEO, Nick Woodman, recognized this: “We went from being thrifty and scrappy and efficient and wildly innovative to being bloated and—what’s the opposite of thrifty? It was undermining the strength of our brand and deconstructing everything we had built.” The company’s newfound convoluted complexity started to come to life through serious quality control issues, which translated into production issues that scarred the company’s reputation. Woodman says, “The teams were killing themselves to launch the products on time. We were doing too many things, and it was taking too long to make decisions because management was juggling too many projects at once.” Woodman and his leadership team have since set about simplifying their company. They have closed down underperforming business units, let go of more than a quarter of their employees, and gone back to a simplified flat structure that is refocused on its core business. GoPro now does a lot less, but it does these things well. Their products no longer are experiencing performance problems, and their mean video views are up 65%. There is still work to be done for GoPro to restrengthen their reputation, but with their newfound organizational clarity they are well placed to reenergize their business. Woodman distills it nicely: “We structured ourselves as a much bigger business. But complexity breeds complexity, and we learned that when the organization is structured that way, you’re not as nimble. You’re not as athletic. When you have fewer lines of communication, things are less likely to break or get lost in translation.”³

Another common driver of complexity is in the acquisition and integration of other companies. Acquired organizations bring their own complexity in the form of convoluted structures, embedded ways of working, and legacy IT architecture or lack thereof. Complexity from systems in particular can be a highly potent driver of frustration, wasted time, and energy. The post-integration systems mess often leaves an acquiring organization IT department scrambling to make sense of the legacy systems, and it often takes a substantial amount of time to either connect or sunset the disparate and disconnected systems. While this significant undertaking is in process, employees have to attempt to get their work done by navigating through the various systems. This can be a major source of complexity and frustration and lead to turnover of talent.

The opposite can also happen: an acquired company may have better, simplified technology and have to deal with a spaghetti of disconnected systems in the acquiring company as it is integrated. I witnessed this during an integration of two major healthcare companies. The acquirer was over 100 years old, a typical slow-moving giant, and the acquired company was smaller, younger, and nimbler. The employees of the acquired company were used to working with speed, and their systems enabled it. When they were enveloped into the acquiring giant and were exposed to the disconnected systems and processes of the larger company, the vast majority of the employees, especially top talent, chose to resign within the first year. The pain of wasted time and energy getting lost in the labyrinth of programs, share points, and collaboration platforms was simply too much to handle. Internal complexity cost the acquiring company a lot of the value it had sought in the acquisition.

Companies that are mired in debilitating complexity can break free of its hold. With strong leadership support and a clear approach for attacking complexity companies can re-energize their people by bringing back the laser focus, reducing the clutter and releasing the reins on innovation. The epidemic of complexity is spreading throughout the world of business and if it is not reined in, those that have managed to keep it at bay will leap ahead and those that don’t will fall by the wayside.

Fourth Industrial Revolution without the Productivity Gains

For thousands of years prior to the first industrial revolution mankind’s productivity gains were made very slowly. The discovery of the wheel, and domesticating horses and cows for farm work were a couple of significant discoveries or developments that had positive impacts on productivity. However, thousands of years passed where no major advancements were made in productivity. Then around 1800 the first industrial revolution began in Britain with the invention of steam powered mechanization. All of a sudden, machines like the steam powered locomotive or production machines, blew up our dependence on human and animal power. So much more could now be done by leveraging this new technology. This first industrial revolution resulted in significant gains in global standards of living.

Figure 1.

A century ago, around 1910, and about 110 years after the first industrial revolution the second industrial revolution began. During this transformative period industry installed production lines that were powered by new electricity grids. Also during this period Frederick Taylor introduced scientific management and companies began to define processes and manage the speed of tasks. This fueled another important wave of productivity enhancements that delivered the next step-change in living standards.

Fast forward 70 years to around 1980 and enter information technology, which connected people and businesses online. Computers took over from type writers and with the discovery of faxing and then emailing the speed of business was transformed. No longer were communications limited to the speed of postal systems or telephone calls. This third industrial revolution transformed how we work once again and delivered another step-change in productivity and efficiency.

Today, we are on the front step of the fourth industrial revolution. We are living in a digital era where artificial intelligence, big data and the internet of things are revealing opportunities for us to finally step out of transactional, repeatable work and focus our time, energy and capabilities on the activities that deliver the greatest value. However, while we are in the midst of the fourth industrial revolution we have yet to realize the productivity improvements that previous revolutions delivered. Why is it that this revolution isn’t delivering the performance and productivity improvement of previous revolutions? I believe a significant driver is the high degree of unnecessary complexity within our organizations that is holding us back. Fueling the propagating nature of complexity are the 20^th century organization structures and management practices that many organizations are holding onto.

Many large organizations today, especially traditional industry leaders, are stuck in 20th-century ways of working. They have dense bureaucratic structures and strict, formal processes with rules and more rules. Traditional best practices told us that we need these things when we establish a new business unit, functional group, or working group of some sort. We believed that we need detailed descriptions of all roles, responsibilities, reporting relationships, decision rights, processes, and rules to get anything done. These things were needed because humans weren’t to be trusted. Installing detailed strict structures meant that leaders could control the output of their people, thereby limiting the risk of mistakes and establishing a baseline of quality. So, as companies grew, they added more and more structures and gradually became complicated messes.

The lines and boxes mode of operating made sense in a time when requirements were simpler and before automation or artificial intelligence. When all a business had to do was produce a product or service that was focused on price or quality, complexity could be managed. People could come to work, do the same thing, and go home, and the company would continue to grow. Like a well-oiled machine, human capital could be managed, measured, and organized as leaders saw fit.

The challenge today is that the speed of industry evolution is so fast that people must be engaging all their intellect on the highest priorities so that companies can keep up with market developments. Also, customers are demanding more and more. They expect high quality, low cost, speed, reliability, and global consistency all at the same time. These requirements coupled with keeping pace with industry developments mean that companies cannot afford to have their people bogged down and distracted in low-value work. It is now critical to refocus teams and strip out and simplify unnecessary or low-value work. This requires rethinking how strategy is distilled, how organization structure is designed, and how processes, systems, and cultures are put in place and nurtured to fuel a new way of facilitating rich innovations and fast and accurate execution.

We are certainly in an age where companies have to deal with a lot of complexity; it is how they deal with complexity that sets them apart from their peers. Importantly, it’s not just the small start-ups that have successfully built companies that control complexity and maintain focus on innovation and entrepreneurship; many large companies have successfully revived their companies through simplification.

Amazon is in the process of taking over the world. Amazon was ranked as the number one most effectively run company of 2017 as...

Table of contents

• Cover
• Title
• Copyright
• Contents
• Dedication
• Preface
• Chapter 1: Bogged Down in a Spaghetti of Structure, Process, Systems, and Rules
• Chapter 2: Using Design Thinking to Simplify Work
• Chapter 3: Common Simplification Focal Areas
• Chapter 4: Simplify You
• Chapter 5: Your Invitation to Simplify Work
• Acknowledgments
• About the Author