Okay: so let’s be clear from the start – the authors, Simon Collinson and Melvin Jay, have a consultancy to promote.
Their company, cunningly called The Simplicity Partnership, provides business consulting to a range of impressive clients.
All of which is fine since their approach is something that I’ve been interested in for a while – hence my enthusiasm to review their book, which is targeted at business managers and leaders. The authors’ main thesis is that organisational simplicity creates wealth, while complexity inhibits wealth creation.
In order to demonstrate this point, Collinson and Jay first define complexity as “the number of components in a system + the variety of relationships among these components + the pace of change of both the components and the relationships”.
Complexity in this context is not the same as ‘complicated’ as the latter merely reflects the size and necessary inter-relatedness of things, whereas the former points to ambiguity and unpredictability.
Therefore, achieving organisational simplicity means ensuring that there are the right number of essential components and connections in place to ensure successful outcomes.
Complexity itself, meanwhile, arises out of strategic, operational and organisational decisions and frameworks. The authors use case studies to show how different types of unnecessary complexity have stymied some well-known corporate behemoths.
Their research into causes and impacts concludes that over-complex companies routinely lose as much as 10.2% of EBITDA compared to those that appear to manage their operations with more simplicity. And that – taken across the world’s large organisations – is a lot of dosh!
Complexity versus simplicity
What became clear to me as the book’s first section came to a close, however, was that the balance of complexity/simplicity is, as much as anything, about knowing what your corporate competencies are and playing to them as strengths.
This means bearing down on non-value-added processes and constantly reducing pointless bureaucracy as well as maximising new customer-centric opportunities to develop new revenue streams.
But the authors also devote about a third of the main body of the book to discussing the impact of people and organisational design on complexity.
This is considered important because people, with their multiple operational relationships, make up many of the components of an organisation and are, therefore, a great source of complexity.
The main people issues (which were identified by the research that underpins the book’s thesis) relate to unhelpful management behaviours, complex communications and meeting structures as well as a lack of focus on simplicity.
In an organisational context, it is decisions about divisionalisation, centralisation, geographic spread, functionality, cultural diversity and management control-spans that determine levels of complexity, however.
But Collinson and Jay’s research shows that complexity can be minimised if organisational structures focus single-mindedly on becoming extremely customer-centric.
The book also explores the complexity that arises from corporate strategy and the pain caused by frequent changes in strategic direction. The process of developing/updating annual budgets, for instance, is highlighted as being unduly ineffectual.
As a result, the authors offer some standard approaches to challenging strategic direction and ensuring that the right priorities remain front of mind.
Reviewer’s rating
The book is based on academically robust findings based on desk research relating to 200 of the Fortune Global 500 companies and a survey of 600 managers from large European organisations. It is written in an acceptable, flowing style and the authors have balanced concepts, discussions and case study material equitably.
Backed up with three extended case studies from the pharmaceutical, banking and insurance sectors and with recommendations for further reading, this is a useful reference book for those of us that need reminding about the need for simplicity.
It would be fair to say that neither the overarching thesis nor the solutions provided by the authors are particularly new or different, however. They outline commonplace tools and techniques as useful complexity-killers, while their straightforward assertions of intent guide the reader towards their notions of simplicity.
Nonetheless, it is helpful to be prompted about good practice and beneficial to read about business in simplicity terms. It is also useful to have the remedial tools and techniques made available in an easy-to-read format.
Despite the lack of originality and the fact that “complexity kills”/“keep it simple” messages have been out there since the mid-1990’s (when Michael Hammer unleashed business process re-engineering onto an unsuspecting world), this book is commendable.
While it may not fully deliver on its sub-title “unleash your organisation’s potential!” it will undoubtedly give pause for thought on things that could be done differently in order to make your organisation more profitable, manageable and, therefore, a more fulfilling place to work for everyone concerned.
- This book was reviewed for us by David Evans, a consultant at business and management consultancy, Burn Bridge Associates.
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