KARL MOORE: This is Karl Moore of the Desautels Faculty of Management at McGill University, talking management for The Globe and Mail. Today, I am delighted to have with us Ron Ashkenas, who is the managing partner of Robert H. Schaffer and Associates, a leading management consulting firm out of Connecticut.
RON ASHKENAS: Good morning, Karl.
KM: Your latest book is called Simply Effective:[How to Cut Through Complexity in Your Organization and Get Things Done] and it's focusing on simplicity. Why do managers have to think about simplicity in this particular time in history?
RA: First of all, before I answer that question, let me just say that most managers don't wake up in the morning and think, how can I make my organization more complex, more convoluted or more difficult to operate?
KM: Of course not.
RA: One hopes not. When we think about simplicity and what they have to do, it's because there are a lot of environmental forces that are creating complexity, like regulatory forces, competitive forces, and the technology that's changing the whole business environment is very complex. Those, in some ways, you just have to deal with.
In addition to that, there is a huge amount of complexity that is self-generated - and that's the complexity that I am asking managers to deal with in this book. The reason why it is so important now is that we have been through a recessionary period and we're still going through it, and much of it was caused by undue complexity. Think of the financial institutions, the banks, the complex products that even [billionaire investor]Warren Buffett said that he could not understand. Most managers could not understand or figure out what the risk parameters [were]and what was really going on. Fortunately, the Canadian banks avoided much of this through their conservatism and being much more simple and straightforward in their product offerings. The American banks and banks around the world did not - that complexity got in the way.
The second form of complexity was all the risk structures. It was very difficult to know actually what was going on. The financial numbers did not connect and many managers right up until the last moment didn't know that their institutions were getting into trouble. We created complexity that had huge economic impacts and managers need to be aware of that and need to really guard against that kind of complexity. This is self-generated complexity.
In addition, all of us are experiencing on a day-to-day basis … a very fast-paced environment with e-mails, Internet and all the information flow that's coming at us in a 24/7 way. On top of that, we have organizations with convoluted decision making, difficult structures, matrix organizations, and globalization. It's very hard to manage.
Unless managers make an intentional effort to say, how do we simplify and how do we figure out what are the right decisions in these decision structures, we're going to get people in trouble and that's what this book is about. We want managers to have simplicity and simplification as a core managerial competence, something that they are always striving for.
KM: How does a manager go about doing that?
RA: There are a number of ways. First of all, do some diagnoses: Where are we getting convoluted or overly complex? Where do we have too many levels and layers, decision structures, committees, matrixes, etc.? Do that on a diagnostic level. Also, look at products. For example: What's the product portfolio? We tend to add products and services and we never subtract from them. As well, look at processes.
The other area managers can look at is … themselves. What do they do to cause complexity on a day-to-day basis? Am I giving assignments in a way that creates confusion rather than simplification? Am I making presentations that have hundreds and hundreds of pages of decks and slides but it's not clear what the real point is? Am I having meetings where people are not real clear as to why we are there? What's the decision? What's going to be the outcome of that meeting? Every manager does things like that so you need to look in the mirror and think about: What am I doing myself? Get a group of people around you to give you feedback on those things and try to simplify your own life and your own way of working.
KM: This has been Karl Moore of the Desautels Faculty of Management at McGill University, talking management for The Globe and Mail with Ron Ashkenas, who is the managing partner of Robert H. Schaffer and Associates - one of the leading management-consulting firms in the world.