Исследование влияния концепции Simplexity на производительность

Despite significant technological advancements (Roco & Bainbridge, 2003) the performance of people and organizations has not substantially risen in the last couple of decades (Damanpour, Walker, and Avellaneda, 2009). Both people and organizations are struggling to meet their targets in an increasingly complex environment, which often has drastic negative consequences (Lin & Lee, 2011). People burn out or lose their jobs due to non-performance, and organizations go into decline, failing to achieve their vision, and in the case of corporations, losing profits and market share.
When it comes to performance, there are four main aspects of organizations that we need to consider: Structures, Processes, People, and Products/Services (Ashkenas, 2007). The four are intimately intertwined and a lack of proper management in any one of them can become the cause of non-performance of the entire organization.
Traditionally, the organizational structure was either hierarchical or flat. However, both of these types of structures have problems (Jacobides, 2007). Hierarchical structures with multiple layers of control prevent vital information from going from the bottom to the top and reaching senior management, which often results in the escalation of crises that could have been avoided otherwise. Another issue with hierarchical structures is the ever-growing amount of bureaucracy, which is introduced as a means of control and ends up stifling productivity and preventing the introduction and spread of innovation in the lower echelons of power (Tirole, 1986). These problems are further exacerbated in complex environments where bureaucracy and a lack of information-sharing lead to runaway complexity (Siggelkow & Rivkin, 2005).
Flat structures work better while organizations are small and require lots of flexibility. However, as organizations grow, they become much more difficult to manage. Once the number of employees is in the thousands, flat structures do not allow the efficient tracking of the responsibilities of employees, which blurs the KPIs of organizational performance. As it becomes unclear, what the people are doing, it becomes impossible to measure and manage their
11
performance. This, in turn, leads to decreasing productivity and increases undesirable complexity (Carzo & Yanouzas, 1969).
An attempt to solve the issues with the two classical structures was made with the introduction of matrix structures. However, they too have many problems (Davis & Lawrence, 1978), the most fundamental one of which is the lack of a clear chain of command. Because each employee has to answer to two managers within the matrix, conflicting interests of the two can lead to conflicting orders, which creates ambiguity in the prioritization of tasks. Moreover, these conflicts can also lead to power struggles between the managers, which takes the focus off the real issues at hand. These problems can be deadly in a complex environment and, if left unchecked, will almost inevitably lead to non-performance.
When it comes to processes, the situation is somewhat better. The most common approach to process organization used today is Business Process Management (Jeston, 2017). BPM is an effective method of optimizing business processes by using a clear structure and objective performance metrics. BPM can be further split into two main categories: Business Process Improvement (BPI) and Business Process Reengineering (BPR). The former refers to analyzing and gradually improving processes within an existing system, whereas the latter means redesigning the whole system from scratch.
This approach works well when systems are linear and predictable. However, as systems become more complex, BPI becomes increasingly difficult. After a certain point, using BPI to manage complexity only creates further complicatedness, which makes the system unmanageable. Using BPR to reduce unnecessary complexity within the system can resolve this issue but within traditional approaches that is seldom done, as BPR is seen as a rare one-off event while BPI is used continuously.
However, the most problematic of the four components when it comes to complexity is managing people. People work more than ever before, spend a disproportionately large amount of time in unproductive meetings and engaged in other useless activities, and struggle at getting the job done on time (Morieux, 2018). This development not only decreases productivity in and of itself but also results in a decrease in employee job satisfaction, which in turn creates a positive feedback loop of decreasing productivity and personnel turnover. All of the above results in a less than optimal experience for business owners and employees alike.
12

In traditional managerial practices, there have been two approaches to managing and motivating employees: the “hard” approach and the “soft” approach (Kirk, 1995). However, in light of the observations mentioned above, the “hard” and “soft” approaches to management have largely failed in their endeavor to increase productivity in a complex environment, albeit due to different factors.
The “hard” approach to management attempted to tackle the productivity problem by introducing Key Performance Indicators (KPIs) and corporate structures, as well as people responsible for them. To a large degree, this approach evolved from Scientific Management and was chosen to allow managers to measure, optimize, and control business functions within the organization.
One of the problems with this approach is that in a complex environment, it creates too much bureaucracy and introduces complicatedness, which makes it impossible for employees to get anything done without jumping through an ever-growing number of hoops. It simply takes too much time and effort to agree on anything. Top managers often don’t recognize this problem, as they are typically exempt from going through the proper channels to pursue their objectives.
Another issue with this approach is that the interests of key stakeholders responsible for a particular KPI or function can often be misaligned with the interests of the organization as a whole. Those stakeholders are only concerned with their specific area of responsibility and will often try to improve it even at the cost of sabotaging other departments, as seeing the bigger picture is not included in their list of responsibilities.
Finally, it is important to remember that large organizations are complex systems. Therefore, like any complex system, they have emergent properties that cannot be captured by a fundamentally reductionist process of introducing KPIs and measures. All of these issues introduce inefficiencies and prevent employees and teams from being as productive as they could be, making the “hard” approach to management insufficient for successfully increasing productivity in a complex environment.
The “soft” approach to management takes a different route: it seeks to empower workers by allowing them to define their work process on their own. At a glance, this may seem like a good idea to deal with bureaucracy and empower employees to optimize their work process themselves. However, this approach comes with its own set of problems.
13

The first of the aforementioned problems is that it causes ambiguity and makes it difficult to determine who is responsible for what. The approach leaves lots of room for slackers and does not provide a clear structure for employees to fulfill their responsibilities. Without a structured workflow, employees are left to their own devices and will often fail to meet deadlines or produce sub-par work due to a lack of standards.
Moreover, it is well known, that what cannot be measured cannot be optimized, which means that due to a lack of KPIs, processes within the organization that employs the “soft” approach often remain sub-optimal, resulting in a lower quality of work and decreased productivity.
The problems with the traditional two approaches prevent them from maximizing productivity in a complex environment. Therefore, a new approach needs to be developed to solve the problems above, one which ensures that KPIs are met without introducing new layers of bureaucracy and thus increasing complicatedness within the organization. The best approach would also account for complexity within organizations and use the properties of complex systems to adjust the solution for the specifics of every company.
Simplexity frameworks
A possible solution to this problem was proposed by Yves Morieux (2014), a BCG Managing Director, who introduced six simple rules that can help managers reduce complicatedness in their organizations (Morieux, 2014). The concept at the core of the framework is called Smart Simplicity. This concept relies on the properties of complex systems and can be used to align the interests of stakeholders with those of the organization, while simultaneously simplifying the organizational structure and increasing productivity. The approach mostly focuses on the people part of the problem and has already demonstrated success in several practical applications.
Another approach to complexity was proposed by Rend Stephan (2021), a colleague of Morieux (2014). Unlike Morieux (2014), Stephan (2021) does not make the distinction between complexity and complicatedness. His position is that all complexity becomes counter-productive after a certain point, which he calls the Complexity trap. Stephan’s (2021) Anti-Complex mindset is probably the most comprehensive framework to date. It addresses all three parts of the problem and proposes several methods of reducing complexity.
14

One more fundamental framework was introduced by Bain consultants Zook & Allen (2016). It is called Founder’s Mentality and introduces tools of dealing with complexity on the fronts of Structure, Governance, Ways of working, and Accountabilities. The parallels between these elements and the Structures, Processes, and People classification used in this paper are fairly obvious.
There also exist a number of other approaches to complexity in business and academia, some of which offer different views on the subject and tools of overcoming non-performance. This master thesis aims to analyze the effectiveness of these frameworks further as compared to other managerial approaches, as well as to investigate which of the proposed solutions are most relevant for achieving the goals of increasing performance and reducing complicatedness. It further aims to analyze, which additional tools can be introduced to increase the effectiveness of existing approaches.
Research questions
The broader objective of the research is to investigate the importance of the concept of Simplexity. Some of the specific initial research questions are as follows:
• How is Simplexity connected to performance?
• Which of the tools introduced in existing frameworks (Smart Simplicity, Anti-Complex,
Founder’s Mentality, and others) are the most important for improving performance?
• How can elements of different frameworks be combined more effectively for improving
performance?
To answer these questions, a singular case study will be performed. As the phenomenon of Simplexity is still developing, a deep qualitative investigation is required. This approach will allow us to answer the research questions most effectively. More information on the research methodology will be provided in the corresponding chapter.
By answering the research questions, this master thesis can enrich the existing body of research with new perspectives on Simplexity and introduce a new framework for dealing with complexity in organizations. Using a high-level approach of analysis of existing tools will allow me to overcome some of the biases of their authors and establish a clearer perspective on what
15

works and what does not. The proposed framework will have multiple academic and practical applications and can serve as a basis for further research into the subject.
Research structure
The structure of the rest of the thesis is going to be as follows: Literature Review, Research Methodology, the Case Study, Analysis of Simplexity tools in relation to the case, Findings and Discussion, and Conclusion.
In the literature review, we will look at some of the existing frameworks of Simplexity. We will start by examining Simplexity as it applies to management and deriving a definition of the phenomenon. We will then proceed to examine the existing Simplexity frameworks in detail and analyze their strengths and limitations. At the end of the literature review, we will synthesize the scope of issues that the existing literature fails to address and define the research gap.
In the research methodology section, the tools and methods of the investigation will be discussed in more detail. The section will begin by postulating the specifics of the research design, describing and justifying the chosen methods of research. After that, a justification of the case choice for the study will be provided. Data collection and analysis methods will be discussed in the following subsection, allowing us to understand how data is going to be gathered and analyzed and why those are the optimal methods.
The Case Study section will be dedicated to analyzing the problems that a company has faced due to complexity and how Simplexity methods have been used to overcome them. The section will begin with a short overview of the company’s history and market position, followed by a closer examination of the crisis.
A thorough analysis of the Simplexity tools used by the company’s leaders to overcome the crisis will be performed in the corresponding section. These tools will be examined both in terms of their relation to existing frameworks and within the scope of the new framework proposed in this work.
The aforementioned new framework is going to be proposed in the findings and discussion section. It is planned, that the framework will organically incorporate elements of existing methodologies, allowing leaders to utilize the most powerful tools of all of those methods together without having to cope with the blind spots of each of those frameworks.
16

In the conclusion section, a summary of the thesis and key takeaways will be provided. The section will also include suggestions for further research on the subject.