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Complexity Management

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Complexity Management

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Complexity Management

Although this title can seem a little absurd, this article aims at understanding better the principles of complexity management. In effect, complexity is a large concept, which usually seems unmanageable for most managers. Let us start with the pillars of complexity management for businesses.

Strategy Alignment with Complexity Management

Most projects fail because this condition is not respected. In many organisations, departments and their people often act and make decisions for themselves.

They do not pay attention to the business strategy. Each one wants the best results for its department. However, managers should understand that their decisions also impact on the rest of the business.

For this reason, any project must involve a team project formed by people from all the departments and functions in the company. This team project should think and act according to the common interest of the business.

Thus, all the strategies have to be aligned with the business strategy. In effect, interactions and complexity will be easier to manage if all the strategies are pointed towards the same goal.

Transparency on Complexity Management

Nowadays, we think that all the information is accessible to anyone but this is not entirely true. Although there is a lot of information in organisations, everyone tries to keep it for himself.

Information is synonym of power and nobody wants to share it, for fear of losing power of decision in front of others.

However, any decision should be revealed to the entire organisations, so all the departments are aware of what is actually happening.

This will enable them to make decisions, which will suit to the business strategy. Thus, the conclusion is that information must be available easily to avoid useless interactions, which will cut complexity.

Sustainability on Complexity Management

When starting new projects, organisations must beforehand make sure that it is not a precipitated decision and that it is suitable for this kind of organisation. In effect, all systems are not good and effective for all businesses.

Organisations have different needs and requirements, which should be satisfied by different and suitable decisions and implementations. Preparation is a key factor for sustainability of any project implementation.

Sustainability enables to have less complex systems. In effect, sustainability involves long-term relationships, which imply less multiplication of interactions and then less complex systems.

Complexity can be easier to manage through smaller units. In effect, large systems imply a tremendous amount of interactions whereas smaller units are more manageable.

Using modular systems is the key to implement projects successfully and outstrip complexity. Although interactions still exist, they are easier to manage through modular systems because any other can replace them at any time.

Complexity is not a threat anymore if you control it with modularisation.

The concept of modularisation is developed into a chapter of Vivek Sood’s book, The 5-STAR Business Network (http://bit.ly/5-STARBN), and will be even more deeply analysed in his next book,

Outsource, Outsmart, Outprofit. Therefore, these four elements are the most important pillars in complexity management.

If you understand how to use these pillars, complexity management will be made much easier for you business. Although complexity can be helpful, it is not worth it to let it control your business. Complexity will certainly beat you. However, you can learn how to be able to manage it and tame its interactions, by using these few elements above. You can find a more detailed approach in the book The 5-STAR Business Network, by Vivek Sood.

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1. These ideas and concepts will be usually expressed by our thought leaders in multiple forums - conferences, speeches, books, reports, workshops, webinars, videos and training. You may have heard us say the same thing before.

2. The date shown above the article refers to the day when this article was updated. This blog post or article may have been written anytime prior to that date.

3. All anecdotes are based on true stories to highlight the key points of the article - some details are changed to protect identification of the parties involved.

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ABOUT THE PRINCIPAL AUTHOR

Today, Vivek and his partners are among 20-30 people on the planet earth who have this deep understanding of supply chain systems, practices and tools. CEOs, COOs, executives and Boards call them in most challenging situations once they know the full potential of supply chain based transformations. Following are key milestones in Vivek's journey:

  • Started in 1983 as a merchant navy cadet at 18 years age, worked his way to qualify as a Captain – qualified to take command of any merchant ship, worldwide.
  • Earned a top tier MBA from UNSW at the top of his class.
  • Joined highly regarded strategy consulting firm Booz Allen & Hamilton, consulting to the CEOs, Boards and senior management of global corporations within Australia.
  • To learn and specialise in supply chain – against all odds, sought out the co-inventor of supply chain in Germany and convinced him to be a partner in his firm, GLOBAL SUPPLY CHAIN GROUP, launched in January 2000.
  • More than 500 successful blue chip projects with high impact business transformations in large corporations using the full power of SUPPLY CHAIN MANAGEMENT.
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If you are deeply passionate about the world of business and supply chain networks as I am, and enjoy digging answers to critical questions that will help build and steer your business with wisdom, then join me. This book is a journey of exploration through the world of business networks that run along the veins of today’s commercial world.

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OUTPERFORM OUTSOURCE OUTPROFIT

The trend of outsourcing continues to grow unabated with the whole gamut of services, from simple to mission-critical tasks. There is not a single company on earth that does not outsource anything. It is not just about cost arbitrage, it is also a finer expression of division of labour at the organisational level. Like all leverage, outsourcing is a double-edged sword too. On one hand, it allows you to do more, faster. On the other hand, if it goes bad, it can easily kill your business. If you do not believe that is possible – you can google the Fox Meyer saga from the 90s and see for yourself.

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Businesses Are Chained By Unseen Chains. If You Are Looking For Ways To “Unchain Your Corporation” A Successful Business Transformation Is Required.

Successful Business Transformations Are Difficult, Yet Rewarding.

Business Transformation Is Fast Becoming A Question Of Survival In The Modern Globalised Era.

Modern Supply Chains Integrate Businesses And Economies Faster By Systematic Information Sharing From Internal And External Sources.

Companies Can Multiply Profits By Progressively Ramping Up Cohesion And Collaboration Of All Moving Parts In B2B Network To Achieve Tighter Integration.

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GREEN SUPPLY CHAIN – AN ACTION MANIFESTO

It is generally accepted that environmental consciousness is now changing to environmental proactiveness as organizations are discovering that it makes good commercial sense.

Boards are asking the management to review their policies related to environmental norms, not only to bolster their corporate social responsibility aims, but also because consumers are asking for greener supply chains

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