Navigating Complexity, Part II

Change is inevitable – what do we have to do?

In our previous posting [1] we addressed the character and impact of fundamental changes in our working and living environments. Today we discuss how we might respond to the inevitable change that is already taking place. We will focus on the factor of “navigation” that can help us to determine our position, to identify our goals, to intervene, and to help shape the change.

By Dr. Friedhelm Böttcher and Dr. Karl-Michael Schumann

The author and founder of Wired magazine, Kevin Kelly, believes that the change brought about by digitization is inevitable:  „We can or should attempt to prohibit some of the results or manifestations of the technological shift, but the technologies are not going away. Change is inevitable. We now appreciate that everything is mutable and undergoing change, even though much of this alteration is imperceptible“[2].

Although digitization is unavoidable, it also creates large scope for new ideas and configurations with enormous prospects. But how can these opportunities be exploited in a world that is changing so rapidly that our ability to absorb new things is no longer sufficient. A World, which permanently confronts us with new capabilities where it may take many years to reach a social consensus on their possible uses and effects? How do we orient ourselves in a dynamic, in which we endlessly experience ourselves as beginners (“Newbies”), regardless of age and experience, in which constant “Becoming” is the normal state?

Many companies engage in enormous efforts to master the digital transformation and its processes to remain viable in the VUCA world. The results of these efforts show, however, that simply increasing efficiency and organic growth is no longer enough [3]. Rather, new strategies and process models must be developed repeatedly in order to ensure the ability to act and to succeed long-term.

Provide Navigation Systems

In the “VUCA-World” it is becoming increasingly difficult for managers and companies to control external and internal influencing factors, to guarantee the viability of strategic and operational decision-making processes and to appropriate the necessary resources, competencies and skills. Many developments are no longer predictable, important information is missing and cannot be obtained. Even in the past, companies and executives were repeatedly confronted with the fact that traditional worldviews and models no longer function. We have learned to expect such changes and to deal with them, but not with the complexity and dynamics with which we are confronted today. Now, we urgently need new tools and, above all, navigation systems that help us to

  • Determine our position, and find points of reference,
  • Identify spheres of action, and our goals,
  • Act and intervene in a controlling manner.

The compilation of key figures such as turnover, costs or market data certainly forms the basis of a navigation system. For navigating in the VUCA-World, however, more advanced granularity and transparency is necessary, which among other …

  • … makes use of the “Innovation Gap” analysis [4] to understand the true investment in innovation activities required to be successful in the long run. This analysis provides orientation because (a) it requires a plausible and consistent explanation of how an uncovered business growth gap is to be filled and (b) it ensures that innovation projects are closely linked to corporate strategy and innovation strategy.
  • … analyses the expected sales and profit contribution, the probability of success of the current projects, and the resources tied up in each one of the projects. This analysis will reveal whether the right measures have been taken, and which options exist for additional future activities.
  • … ensures that even weak signals are recognized, which indicate an immediate or future need for making decisions. Those weak signals are particularly important that indicate early deviations from an expected behavior pattern and thus provide a better chance for timely action.

In view of the dynamics of the changes, it is less important (and often not even possible) to make precise forecasts. Rather, we must aim at anticipating and circumventing dangerous obstacles, and at finding one’s own place, one’s own design space in the VUCA world. Next week we will be presenting navigation instruments here at www.futurebizz.de. Until then, we look forward to your feedback and suggestions on the subject.

Picture credits: istock.com/ cybrain

Quellenverzeichnis

List of sources

[1] The article series is based on a keynote lecture given at the VDI Annual Injection Molding Conference in Baden-Baden on February 20, 2018.

[2] See Kelly (2016), “The Inevitable: Understanding the 12 Technological Forces That Will Shape Our Future”, Penguin, New York 2016, p. 2ff.

[3] Keeley, L.: “Ten Types of Innovation,” Wiley, New Jersey, 2013

[4] The innovation gap is defined as the difference between the realistic sales forecast for the next few years and the targeted growth target.