Examples of Mastering Complexity

Explicit empirical research on how businesses deal with complexity is still thin. But using the lens of complexity a number of observations can be made. This chapter presents three such cases. IBM masters the complexity of its business (and with that the dynamics of its industry) by organizing all its information in one database, disembedded from the structure of its organization, in which all its external and internal transactions are recorded with multiple attributes creating a multidimensional organization. Ashby’s Law of Requisite Variety cannot be achieved in organizations through Weberian structure, only through information. Procter & Gamble in 2000 responded to pressure by the capital market to centralize its organization and to reduce its product range, instead by designing and implementing an information system, maintaining the required decentralization while solving the problems of decentralization and maintaining the variety in its in products while solving the problems of a large variety in products as induced by conventional organization methods. The Academic Medical Center (hospital) solved the complexity of gastrointestinal oncology patients, not by restructuring its organization, but by adding a fast track across the medical departments involved, thus creating more complex expertise around the patient, improving its diagnostics and treatment, while maintaining the required specialized medical departments; simple for the patient but more complex for the executive board and its staff departments. The question is not how to get rid of complexity, but what is the most efficient place for complexity in the organization.