Think Research

Layered Complexity

The many facets of complexity: Unthinking complexity: Bypassing the simple solutions Diffused complexity: Hiding the overhead Chosen complexity: Insisting on intricacy Layered complexity: Overflowing in-boxes

The last article in a Think Research series that uncovers the causes of needless complexity and provides solutions.

The time-consuming part of being a manager is not necessarily managing; it can often be the tangential activities that take up the hours of the day.

Most companies have layer upon layer of activities that managers are responsible for completing - approving IDs, tracking mobile phone accounts and other travel expenses, tracking and reporting system security, ensuring that employees have turned in necessary corporate documentation, and approving or reviewing small purchases. No wonder, then, that many managers feel less like people managers and more like bureaucracy managers. They are prevented from doing what they were hired or promoted to do.

Layers destroy value

These seemingly small things can add up to 150 e-mails per day, 10 to 15 phone calls and nearly endless meetings. This can severely limit the time a manager has to lead people and manage the core business of the company.

Another insidious side effect of all these process requirements is that each requires time that could be spent managing customer relationships, selling or delivering products and services or finding innovative ways to beat the competition. When this is carried too far, the bureaucracy wins and the company loses.

Companies in this predicament are suffering from layered complexity, a situation where a number of trivial requirements are given to leadership from multiple directions without an understanding of the collective impact of those requirements. This can lead to a landslide of work - and more importantly, to choke points. Choke points are places within the organization where the people can't seem to get everything done because they are required to fulfill inbound work from too many processes. Although these choke points frequently occur in the middle management ranks, they can occur elsewhere as well.

Problems

Layered complexity is created when processes are initially designed, but even more commonly, when they are being redesigned to make improvements. There are several potential problems that can happen during this phase:

Assuming triviality: Processes need steps for reviews, approvals and exceptions, and companies typically want these steps to be performed by upline managers and executives to maintain control. Because there are relatively few of these steps and exceptions in an individual process, the designers think the time required of these people is trivial.

The problem is that there are many process designers thinking about these requirements in the same way - and they are often targeting the same levels of leadership in the company to perform the work. Because no one is thinking about the collective impact, these requirements simply roll onto people, choking out the work they are uniquely qualified to perform.

Assuming managerial oversight is vital: This problem stems from a dangerous assumption or belief - that managers have to be consulted on every decision. The implication is potentially disastrous: employees who feel less empowered and invested in their work, and who may not even fully complete the requirements, knowing that someone else will come to the rescue.

Assuming automation won't work: Process designers may be working in a vacuum and may not have a good sense of the relative worth of a particular process to the goals of the company. They may assume that their process is too important and requires too much intelligence to be automated. This approach creates a situation where managers are spending their time on tasks that aren't crucial to the success of the company (e.g., requiring manual reviews of all expense reports, no matter how small the amount). Taking into consideration the company's goals and the entire landscape of its processes is the only way to make sure that leaders' time is used most effectively.

Assuming everyone needs to approve: In matrixed organizational structures, there are often people who perform similar roles. In many situations, these roles need to coordinate their actions or decisions. For instance, in a situation where there is a client contract "owned" by one part of the business that is being staffed out of another part of the business, there may be at least two different teams of attorneys who care deeply about the implications of the contract and its execution.

In these instances, the process typically calls for these parties to get together to decide what to do. And they do that, usually after a series of scheduling delays that may complicate the problem even further. Then, each group debates the pros, cons, issues and problems - sometimes endlessly. This process may go on for too long because no one has full authority for the decision. They all have a piece of the action, but no one is (or feels) authorized to make a decision. Instead, they must come to consensus, often an almost insurmountable task.

When a company creates layered complexity, it has lost sight of the collective impacts of trivial requirements on the people who must perform the work. But even more importantly, it has lost sight of the real work it expects and needs for people to perform. Everything that someone is asked to do has an opportunity cost, and something much more valuable may be missed.

Why don't people simply prioritize correctly and do what is most important first and leave the rest for later? For various reasons, these trivial requirements often command an inordinate amount of immediate attention, typically because someone else is waiting - there is a built-in "nag" mechanism, human or automated, to ensure they get done. So even the best employees default to the urgent tasks and leave the important ones undone.

Solutions

IBM Research has identified some ways that companies can begin to find and root out layered complexity in their businesses:
1. Identify choke points. These are the roles that a company tends to defer to when requiring review, approval and exception process steps. The first clue may be the people who cannot seem to get work done, who complain about long hours and never-ending in-bound requirements, and who may go for weeks sometimes before answering important e-mails. Our experience is that there are typically two to three adjacent roles in the hierarchy that are choke points.
2. Review the work required by the people in these positions. If the work consists of many small tasks from many different processes, that's a sure sign of layered complexity.
3. Prioritize processes and make choices between them. Controls are important and necessary, but where companies go wrong is that they prioritize these controls over the principal work of the business. Generally, the processes that enable a business to earn a profit are the highest priority. Once a company has prioritized processes, it can review the work required by each of them with a more balanced view.
4. Rethink the steps that are doled out from each of the processes in light of the process priorities and the opportunity costs for the choke point positions. Can some of these steps be eliminated altogether? Can other steps be automated? Can some be delegated to lower level employees? But be careful to eliminate choke points, not simply move them.
5. Think through the timing of various process requirements to avoid the bunching problem. If the end of the quarter is a particularly busy time for key players, then move necessary administrative requirements to other times of the quarter. Companies should learn to exercise the amount of control that they do have.
6. Clarify who has approval power with steps that require multiple players. Minimize the steps that require multiple roles since it tends to delay action and leads to each player looking to the other to take the responsibility for the ultimate decision.
7. Managers themselves can make a difference in their own workloads even if the underlying cause of the complexity is not addressed. The most important action for them is to delegate as many of these tasks as allowed by company policy.

IBM Research can help - contact Sara Moulton Reger (moulton@us.ibm.com) or David Singer (singer@almaden.ibm.com).