Ted Cadsby, MBA, CFA, is a corporate director, principal of TRC Consulting, former executive vice-president of the Canadian Imperial Bank of Commerce, and author of two books on investing. This was cross-posted from Huffington.

If history teaches us anything, it’s that history teaches us nothing. A decade after the “mission accomplished” banner debacle, many voters still clamor for simple solutions captured by tidy slogans, such as “no new taxes” or “no new spending.” As an electorate, we still don’t seem to grasp how complex our 21st-century challenges are — how they defy simple, sound-bite solutions. Never mind President Obama growing into his role by becoming “more presidential.” When are we voters going to mature?

Witness the preposterously overblown confidence of our 20/20 hindsight. As in, “Unemployment would be lower if Obama’s initial financial rescue plan had been bolder,” or, “The economy would be on stronger footing if Obama had not increased the deficit so much.” Really? The fact that economists didn’t agree then and don’t agree now should be proof enough that nothing was or is obvious.

Or the seemingly perfect clairvoyance with which we predict the future. As in, “We have to spend a lot more to get unemployment down,” or “Our only choice is to reduce the deficit if we’re going to keep the country strong for the next generation.”

The reality is that 21st-century problems are too complex to know definitively how they can be solved. They are more than just complicated — they comprise multiple causal factors that interact in intricate ways that are impossible to perfectly assess and predict. How much better or worse the economy would be now had the original fiscal stimulus been different is fundamentally unknowable. Same for the impact of policy decisions being taken today — we are limited to best guesses at how all the moving parts will shift and adapt. To think that anyone, including the president, can assess and respond to complex problems with certainty, is to be caught in a child-like mindset where an economic system can be fixed as easily as glue repairs a broken toy.

This doesn’t mean public policy has become just a crap shoot. We do have ways of tackling complexity, largely emanating from the two fields of complexity science and cognitive science. Complexity science reveals that the more complex aspects of reality are best analyzed as whole systems that can only be understood by examining the deeply-imbedded, non-linear interrelationships of the system’s parts. Cognitive science reveals that our minds evolved to think not with a systems mindset, but to rely on simple, linear, cause-effect modeling that served our ancestors well but is inadequate for grappling with modern public policy issues. Therein lies the source of our intellectual immaturity: the mismatch between how complex things work and the simple cognitive methods we use to understand them. Our increasingly interconnected and interdependent world cannot be described with our default preference for clear, black and white solutions. Complexity demands a more sophisticated cognitive approach.

Complex problems require multiple perspectives, a variety of possible explanations and constant testing and retesting of hypotheses before it is safe to draw any conclusions. Even at the point of concluding, the best we can hope for are provisional solutions. In fact, while our natural operating style is rushing to certainty on the back of a simple model of causality, complexity is best handled with experimentation. Because the information cues we need to make sense of complexity lie below the surface, complexity forces us to try something, interpret the feedback, and then try again. While political leaders such as Obama may appear to be vacillating, they may be the best complexity managers around, because they never assume “mission accomplished.”

Obama deserves some benefit of the doubt that he’s managing complexity in the best way anyone can. It’s time for us to grow into our roles as a mature and sophisticated electorate who resist the temptation of Republican-style “sloganism” — especially the Tea Party variety.

The race is on between the complexity that is exploding around us and our ability to understand and manage it. We’re behind and the only way to catch up is to grow up.

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Join the conversation! 8 Comments

  1. I guess the dilemma we face here is communication. The problem obviously does not only exist in the United States, but probably in most countries. Good communication is based on simple messages. Every communications trainer will tell you that people cannot take in more then one message at a time, and the simpler the better. Because of that, “sloganism” has become very successful. Just remember 2008: “Yes, we can!”. Working and making decisions in complex systems is already challenging enough and what is described as ‘complexity science’ in the quote above is just a nascent field. But trying to communicate decisions that have to be taken in such a complex system to ‘simple people’ (meaning people that are not engaged on a daily basis in analyzing complex systems) makes our work even more complex.

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  2. A few somewhat random thoughts about Ted’s piece:

    One of the real challenges we face is understanding the role of institutions. Individuals have clear limits that institutions are designed to overcome. The “us“ is very much part of how we have developed capacities for ingenuity that solitary humans cannot muster. I would argue we need to keep working at designing and growing better institutions.

    Second, while we may have a low-bandwidth, singular, linear kind of mind, that can only be partly true. We cannot process high volumes of analytic information but we are good at spotting patterns, processing images, and connecting laterally. We remember faces, for example, and instantly mix highly varied bits together in such a way that intuition and insight can come to us in a flash, something computers are much less capable of.

    Third, I think a significant part of the challenge face is our inherited mindset about what constitutes legitimate organizations, businesses or operations. The more rules, policies, studies and legal defenses we`ve assembled, the better we feel. A full cadre of experts in a financially sound institution with lots of cool computers and software is deemed to be a fantastic time-travel machine that can give us telescope-like powers to see the future.

    Fourth, one of the most critical organizational assessments we need to make at all levels is the the degree of adaptability that is present, what is often called resilience. Happily, there is a growing movement of people who are taking resilience and adaptive approaches seriously. We desparately need this. As our world atomizes in various ways (see the rapid increase in socially isolated people in the US) we will see all kinds of grief. But isolation won`t last everywhere. In various ways new assemblages of people will and organizations will develop. Weaving adaptive thinking into these newly forming processes has much higher prospects for success than reforming all of the existing rigid organizations.

    Great post. It`s worth an actual and extended conversation.

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  3. I find both this post and the comments draw up fascinating parallels with issues we in the aid community are wrestling now, at a time in which myopia and fear lead to “sloganism” (reductionism) and an unwillingness to spend resources on anything hinting of experimentation, or even on foreign aid for that matter.

    In fact, I find another layer of complexity in how humans in the aid community can process and react to complexity. In fact some can change their view from one level to another (individual to collective or institutional), due to fear, inertia, or lack of energy/appetite to spend every moment winning over opponents. At the individual level, I see much more willingness to adapt, experiment, accept failure, re-assess and experiment again, in the aim of getting it right and putting forth programs that make a difference in people’s lives.

    But then at the collective, or institutional level, I see a reticence to experiment and learn from failure even if this conflicts with what one believes on the individual level, espousing reductionism to join the collective or not to create waves. And sadly, the higher profile and more complex the environment in which we work, the worse the phenomenon manifests itself.

    There are points of light out there. I noticed Ben’s response to a comment on Buzz Holling’s speech about identifying and overcoming ‘hurdles of fear.’ Would welcome more posts and discussion on that.

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  4. Melissa, I found “The Innovator’s Dilemma” a useful study of why, even when populated with intelligent and committed people who know about better approaches, organizations are very bad at adapting successfully to take advantage of new opportunities. It’s not the last word on the matter but does go well beyond the usual “bureaucrats don’t think and managers don’t have a clue” kind of rhetoric that is so common.

    The organization as a system designed to optimize certain functions under certain specific conditions does very poorly in moving laterally into new space. Buzz Holling’s “Panarchy” gives a sense of the disruption needed for new and better functions to emerge.

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  5. […] just found this post from Ted Cadsby on Ben Ramalingam’s blog, a blog dedicated to exploring complexity and […]

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  6. […] is a risky complex system. Development is a risky business. Success is elusive and failure frequent. Moreover the […]

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  7. To deal with complexity means not to accept it, but to fight it and learn to to abolish institutions.

    Growing complexity is not a law of nature but a deliberate choice. Day by day, new institutions are created in order to channel all sorts of tasks and problems. However, old institutions – no matter how obsolete – tend not to be abolished. This is because of the phenomenon of self-referentiality: after a while an institute becomes its own goals, creating its own rules and regulations, etc. In a functional society, (Adam Smith’s division of labour) groups of people are dependent on the existence of this or that institution, even if it is no longer serving its original purpose. This makes that institutions fiercely resist any attempt to modify it, let alone abolish it.
    And that’s exactly what is needed in order to reduce complexity: to abolish old institutions, rules, laws, practices etc. Some meta-institutional organism (state?) should do this by force, as it will never happen voluntarily.
    The alternative is that people adapt to complexity. Ideally they are to become multi-causal gnomes (computers). This however is not a neutral process. Some gnomes will be better than others. And it is good for consultant’s businesses.

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  8. I believe that the in(cap)ability to think and analyze complex rather than simple/simplified and linear has to do with the education system and the core values that are inherent to the American culture and system –e.g. focused on efficiency and cost-effectiveness, merely reductionist and quantified analysis, and quick fixes or fast remedies that can fight symptoms of problems, rather than on synergies and impacts which is per definition more complex requiring rather mixed measurements, systems analysis tools that can help people get their head around complexity, and genuine dialogue and debate between various perspectives and interpretations that can help shaping various strategies simultaneously for tackling the root causes of the problem from different angles…

    Europe tend to go a similar rout, which is alarming!

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About Ben Ramalingam

I am a freelance consultant and writer specialising on international development and humanitarian issues. I am currently working on a number of consulting and advisory assignments for international agencies. I am also writing a book on complexity sciences and international aid which will be published by Oxford University Press. I hold Senior Research Associate and Visiting Fellow positions at the Institute of Development Studies, the Overseas Development Institute, and the London School of Economics.

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Evolution, Leadership, Public Policy, Strategy