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The art and science of the possible

~ A celebration of non-zero sum thinking

The art and science of the possible

Author Archives: lnedelescu

Severe business crisis turn-around: turning vicious “tailspins” into virtuous dynamics

13 Monday May 2013

Posted by lnedelescu in business, consulting, Crisis, strategy

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business, Business Development, Crisis Turnaround, Recovery, Risk, Selectivity, strategy, Tailspin, Vicious vs. Virtuous Cycles

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Just like aviation seems to have mastered the science of stable flight, so does business look stable and predictable from afar. But at a closer look tailspins are never far-away and remain a possibility. Many companies don’t go out of business over prolonged periods of decline, but rather suddenly. The warning signs for a vicious cycle are there, but the signals are usually weak and management overlooks them until it is too late. At that point revenue spirals downward, less money is available to pursue new business resulting in a reduced probability of getting business, and the enterprise is headed straight for a spectacular crash.

I will save the details for how a company enters tailspin for another blog, but here I want to focus on the key strategy to recover from vicious cycles, and even turn them around into virtuous ones.

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It all depends: the art of problem solving

10 Friday May 2013

Posted by lnedelescu in consulting, design thinking, innovation, knowledge, learning, paradox, problem solving

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Chaos, complexity, Consulting, Dave Snowden, Disruption, Entrepreneurship, Globalization, Innovation, Intractable Problems, Introspection, Knowledge, Learning, Methodology, Open Mind, Relativity, Risk, Roger Martin, Russell Ackoff, Self-Awareness, Wicked Problems

It all Depends

Over the last decade, I’ve lived globalization, entrepreneurship, change and crisis, complexity and chaos. I must have run into at least a dozen intractable, impossible, show-stopper, nerve-racking, all-or-nothing situations and at least several orders higher magnitude wicked problems. I also ran into the entire spectrum of human behavior, what the Clint Eastwood character would call the “good, the bad, and the ugly” (I would actually add the “irrational”).

About five years ago I also started an in depth study of the cutting edge thinking related to complexity and disorder. Finally I also studied and noted my own behaviors and responses in such circumstances; like Hansel and Gretel I traced my steps into the wilderness in case I ever had to find my way back. This ability to not only act but rationalize the act has served me well, substantially increasing my awareness and lowering my stress when faced with the new and unfamiliar. It has also resulted in a problem solving and sense-making body of work which I think rivals the best of what’s available on the market. I have yet to capitalize on all this, but I have learned to be patient.

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A visualization of “discontinuous evolution”

08 Wednesday May 2013

Posted by lnedelescu in complexity, design thinking, knowledge, management, Organizational Development, problem solving

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complexity, Discontinuous Change, Innovation, management, phase transitions, strategy

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In my blog entry arguing for a unified theory of management, I proposed that most top management reference a fundamental distinction between exploration of new knowledge (i.e. innovation) and exploitation of existing knowledge (i.e. efficient operations).

Business and indeed the entire society is caught in an evolutionary dynamic that balances exploration and exploitation – see David Hurst’s ecological perspective. While the exploitation cycle is amenable to incremental thinking, exploration appears to be prone to discontinuities – hard to predict leaps of logic.

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Towards a unified theory of management

07 Tuesday May 2013

Posted by lnedelescu in innovation, management, taxonomy

≈ 1 Comment

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Ackoff, Christensen, complexity, Dave Snowden, David Hurst, Design, Fredmund Malik, Innovation, management, Management Theory, Peter Drucker, Roger Martin

Drucker-reading

Exploration vs. exploitation is a common thread amongst top strategy and management thinkers. Exploration is aimed at the future (strategy, innovation) while exploitation is more aligned with business operations, i.e. efficiency. Does this point to a unified management theory?

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Current HR practices, a significant liability for the world’s future

06 Monday May 2013

Posted by lnedelescu in business, capitalism, future, human capital, innovation, science, society

≈ 4 Comments

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Christensen, Design, HR, human capital, Innovation, Roger Martin

father_time_flying_past (1)

Some of my blog entries may be taken as theoretical exercises. While I make use of the latest thinking, most of the things I write about are in fact directly extracted from personal experience. It is my attempt to turn what could otherwise be called frustrations into constructive insights. I felt this short introduction was necessary simply to add a degree of credibility to what follows. Now let’s get back on topic.

Let’s start with a preview of my thesis. My argument rests on three observations: (1) innovation is vital to our future; (2) innovation is slowing down; (3) current HR practices are a contributing factor. Having argued my case, I will end by providing a few ideas on possible solutions.

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Complexity forces the distinction between strategy and planning

02 Thursday May 2013

Posted by lnedelescu in complexity, design thinking, management, strategy, taxonomy

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Ackoff, business, complexity, Cynefin, Design Thinking, Idealized Design, Martin, Planning, Playing to Win, Roger Martin, Snowden, strategy

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Following the publishing of his latest book, “Playing to Win”, Roger Martin has made a paramount distinction between strategy and planning. Having the greatest respect for Roger Martin’s thinking, I usually take his insights as foundational. Since foundational insights are few and far between, there’s a likelihood that other thinkers have come across similar distinctions. I didn’t have to search for long to find echoing insights in the work of Russell Ackoff, systems thinker emeritus, and Dave Snowden, complexity guru.

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Drucker’s “doing the right thing”, Superman’s Lex Luthor and sales strategy

30 Tuesday Apr 2013

Posted by lnedelescu in business, sales, taxonomy

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Ackoff, Apple, Customer Approach, Drucker, Effectiveness vs. Efficiency, Gene Hackman, Lex Luthor, Sales, Steve Jobs, strategy, Superman

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Foundational thinkers are often politely dismissed on the excuse that “abstract” insights are difficult to apply to concrete situations. I will make use of Drucker’s paramount distinction between “doing things right and doing the right thing” to counter that popular belief using a concrete example: sales. But before tackling the sales example, let me make use of another foundational thinker of similar caliber, Russell Ackoff, to reinforce Drucker’s distinction. In Ackoff parlance, “doing things right” results in more efficiency, or improving a certain solution, while “doing the right thing” is a matter of effectiveness, or questioning the problem statement.

Now let’s move on to the sales example. In sales we are taught that the customer is king. And as long as the customer knows what he wants and what his problem is, this is great. But in many cases, particularly in today’s increasingly complex world, the customer doesn’t know what his problem is and may not even know what he wants. Continue reading →

And the nominees (for foundational thinking) are…

29 Monday Apr 2013

Posted by lnedelescu in management, taxonomy

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Ackoff, complexity, Foundational Thinkers, Human Organization, Jaques, Life, management, Ontology, Prigogine, Vester

vesterAckoff-triarchyPrigogine_6jacques_2

In a recent post I proposed a distinction between foundational thinkers and “how” teachers. While defining the generic concept, I did not give any concrete example of what I consider to be foundational thinkers. In this post, I introduce a select few. The selection criteria for these thinkers is the development of a complete and internally consistent paradigm related to life, human organization and management.

Russell Ackoff – for providing a complete ontology of the management practice and its pphilosophy,

Elliott Jaques – for providing a complete ontology for human organization,

Frederic Vester – for providing a complete bio-cybernetic model of complexity,

Ilya Prigogine – for the pursuit of the unification of natural and social sciences using complexity.

It is worth mentioning another trait these four shared: they were all iconoclastic personalities within their respective fields.

Frameworks, trade-spaces, matrices: engineering thinking in management results in big, stagnant bureaucracies

25 Thursday Apr 2013

Posted by lnedelescu in complexity, consulting, human capital, management, Organizational Development, science, strategy, taxonomy, technology

≈ 2 Comments

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Analytic Thinking, bureaucracy, business, complexity, effectiveness, Engineering, future, management, models, philosophy, Validity

The most important function of management, particularly executive management, is setting future direction. That implies decisions and choices about the present and future.

Because engineering thinking or more broadly speaking analytic thinking predominates in many executive and consulting circles, it is believed that decisions require a degree of rigorousness similar to that of the scientific method in natural sciences. And so, it is firmly believed that analytic tools empower managers to make sound decisions. The result is a myriad of tools reminiscent of engineering speak – frameworks, trade-spaces, matrices – packaged in neat Power Point slides.

This all very good, but, as philosopher of science Isabelle Stengers remarks  “tools are demanding – they do not confer the power of judging, they ask for the choice of the right tool for the right situation; in other words they oblige us to think and wonder”. The danger that Stengers cautions against is the rigid interpretation of the power of tools. Tool power should never be situated above human judgement. And when it does, this results in the tools getting a life of their own, and embedding the human element which is helpless to escape their hold. This ultimately results in a bureaucratic construct as the purpose of humans becomes not the seeking of meaning and validity, but rather the maintenance and upgrading of the tools. This also results in a proliferation of enforcer types at the expense of creative types, reducing the number and quality of choices about the future.

A more progressive view of management tools is as “enlightening abstractions, precious new tools for thinking” rather than “ready made instruments”. Also, in Stenger’s view, the relationship between user and tool is not one-directional; rather, “tools modify the ones who use them; to learn how to use a tool is to enter a new relation with reality, both an aesthetic and practical new relation”. In my experience, this dual directionality can also unfortunately work backwards: rigid tools can have a limiting effect on thinking.

Source of Isabelle Stengers quotations is “The Challenge of complexity: Unfolding the ethics of science – In Memoriam Ilya Prigogine”

Also check out Dave Snowden’s related blog entry.

A brief modern history of future predictions: engineers vs. social scientists

23 Tuesday Apr 2013

Posted by lnedelescu in complexity, future, problem solving, society

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Club of Rome, Cold War, Consumerism, Drucker, future, management, Management Cybernetics, philosophy, Philosophy of Science, Quantitative vs. Qualitative Predictions, Social Science, Society, Stafford Beer, System Dynamics, Toffler

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At the height of the Cold War predicting the future become serious business. A nuclear World War III was a real possibility and a literally cold and dark planet awash in radioactive ash a likely prospect. But communism wasn’t the only threat to the free world. Ideology aside, consumerism coupled with energy shortages and population growth provided good reason for questioning the very sustainability of our civilization. Ironically, communist propaganda pointed precisely to greed as capitalism’s Achilles heel.

So it isn’t surprising that by the 1970’s two schools of thought were already embarking on predicting the future. Since I have not come across this type of distinction between “futurists” in literature, I will proceed to describe it here. It is worth noting that by “distinction” I don’t mean opposition since both schools of thought can be regarded as members of the larger umbrella of systems thinkers.

First let’s loosely define the “engineers”, or better said, the engineering school of thought. Engineering had proven successful in World War II for a number of inventions, including rocket control systems. While Wernher Von Braun was working hard on getting us to the Moon, geniuses of the likes of Jay Forrester and Stafford Beer saw other uses for rocket control theory. Namely they had the insight to apply engineering thinking, particularly the mechanism of feedback, to social systems. This resulted, respectively, in the birth of two entirely new disciplines: system dynamics and management cybernetics. In parallel, Mihajlo Mesarovic, also an engineer emeritus with whom I’ve had the privilege of taking a graduate course at Case Western Reserve University, was also working on an elaborate mathematical model to predict the future state of the world. The Club of Rome, a new organization with an interest in humanity’s fate, saw the opportunity for these new methods to lend a degree of rigorousness to their own predictions about humanity’s long term future. This resulted in several publications in the early 1970’s. Limits to Growth and Mankind at the Turning Point received widespread attention since they discussed the “predicament of mankind”. The underlying belief of the engineering school of thought was that given a sophisticated enough computer model, the future could be more of less “mathematically” derived. Perhaps not surprisingly The Limits to Growth report was first introduced at a symposium in St. Gallen Switzerland, which remains a powerhouse for management cybernetics – Fredmund Malik and his consultancy continuing to this day the work started by Stafford Beer.  In essence Limits to Growth painted a pessimistic view for the world future where shortages were likely to stop and even revert human progress. Simply put, the Club of Rome’s prediction for the early 21st century, largely based in engineering thinking, spelled disaster.

At about the same time, a number of futurists emerged from the direction of the social sciences. Peter Drucker, Alvin Toffler, Charles Handy and others were by no means engineers and were not using models, at least not in the quantitative sense; however, this did not discourage them from looking into the future. The term that Peter Drucker eventually chose to describe himself, “social ecologist”, captures well this entire breed of futurists. What these futurists were is astute observers of the human condition and social ecology, the same “tools” employed by the ancient Greek philosophers whose insights still form the basis of western culture. Drucker and his peers did not use quantitative methods but made predictions derived from qualitative insights at the intersection of human psychology, technology and social constructs. Many of those predictions are still relevant today while predictions presented by the engineering school of thought had to be dismissed or significantly adjusted. In all fairness, in the Club of Rome’s 2012 update to the Limits to Growth, “2052 – A Global Forecast for the Next Forty Years”,  they have moved considerably away from hard quantifiable predictions. They have also moved in the direction of the social, describing their latest work as “educated guesses, combining data, modelling and hard science with an understanding of human nature and its systems and intuitions”.

Per this latest evidence, the two schools of thought can be said to be converging. Perhaps the best insight to be derived from the distinction presented in this piece is that we have much work to do in reconciling natural and social sciences. Until we do, and possibly even after, predicting the future will remain messy business. Elliott Jaques and Ilya Prigogine come to mind as two exponents of the social and respectively natural sciences that have made significant strides in reducing the divide between the two paradigms. I have always said that the universe preceded humans and so, the fact that we glean it through the reductionist lens of separate sciences suits our own convenience more than cosmological reality.

What about our ability to predict the future? Is it a legitimate undertaking or modern alchemy? Is the future clearly discernible through the lens of an all encompassing computer model, or does Lorenz’s and Feingenbaum’s Chaos Theory with its Butterfly Effect render any attempt at prediction hopeless? I would dare say that the work of Drucker, Toffler, and Handy among others has addressed both assertions: exact predictions of the future based in quantitative methods is indeed a hopeless undertaking, but a broad, nonspecific peak at the future is possible through the lens of qualitative thinking anchored in the constancy of human nature. But here’s the catch: only a select few appear to have the capacity for this type of undertaking, and they certainly aren’t employing a repeatable process or “best practice” in doing so. For the time being it appears that staring into the future is more art and science.

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