“I Believe Complex Problems Require A Complex Solution” (Lesson 5)
Sophistication Bias occurs when leaders cannot see the simplicity of an organisation, as they have difficulty visualising any meaningful advantage associated with this. To most leaders, an organisation needs to be sophisticated as this personifies intelligence and greatness. If, however, an organisation is simple, then it operates on ‘levels of discipline,’ along with ‘common sense, persistence and courage’ making it difficult for highly educated leaders to relate.1
In a complex world, educated leaders tend to look for complexity. These leaders perceive distinction and expansion as being linked to a complex structure, as to them this is competitive in an ever-changing market. However, this thinking is old and not progressive.
Today’s competitive organisation needs to be simple and straightforward as this enables it to be flexible and adapt to meet changing consumer demands. As a leader, this means embracing a simple perspective as it often gives you an ability to look at problems differently; it opens your eyes to otherwise unseen possibilities.
What’s the cost of complexity for a leader?
The complex perspective can result in you missing the simple solution and either failing to solve the problem completely or wasting valuable time. The answer per se may be right in front of you, but you cannot see it as you’re seeking out one that is far more comprehensive. And as you’re spending all your time finding that comprehensive solution, your valuable time is being spent elsewhere, rather than on leading your team or organisation.
Consequently, the cost of complexity is significant to an organisation. When a leader’s attention is not on advancing the company, then competitors can easily move in and dominate. Often these competitors are start-ups who solve problems faster and are focused on building a rapport with customers.
Start-ups typically have limited funds, so they don’t have a big budget to throw at more complex solutions or the resources to spend hours looking for answers. Instead, they need to find simple solutions that are affordable. Often start-ups use their creativity because it comes free-of-charge and this creativity and ability to think outside of the traditional organisation square enables them to outwit and overtake some of the larger organisations.
So, the big slow-moving organisation with many employees and overheads, and that million-dollar budget, gets lumbered with a heavier load—a burden that erodes their profit, leaving them fighting for their market share.
Having worked with larger organisations, I’ve witnessed resource wastage firsthand. In these instances, rather than getting creative when a problem presents itself, leaders look to bring in a specialist or even a team of specialists to solve their problem. This strategy can cost thousands in the blink of an eye, and yet when leaders don’t have these funds, they get resourceful.
A resourceful leader who looks for cost- and time-effective solutions to problems has a mindset that then permeates through a business. Team members also become more resourceful; whereas team members in an organisation that throws money at problems, also tend to think that they have an endless budget.
1 Lencioni, Patrick M. The Advantage: Why Organizational Health Trumps Everything Else In Business. John Wiley & Sons 2012.