LEAD 0510LEAD 0510Leadership DevelopmentLeadership Development

Thinking Strategically in Thinking Strategically in Complex Times Complex Times

Reflections on “Moon shots”Reflections on “Moon shots”

• Which ideas appealed to you?

• Which can you integrate into your strategic thinking?

• Which challenged you to reframe?

Levels of UncertaintyLevels of Uncertainty

1. Relatively clear view of the future• One or two obvious options

2. Alternate futures• Mutually exclusive and collectively

exhaustive

3. Range of futures• Not mutually exclusive or exhaustive

4. Truly ambiguous• Uncertainty is unknown and unknowable

Hugh Courtney. 20/20 Foresite

Leadership and Change StrategiesLeadership and Change Strategies

1. Traditional• SWOT• Benchmarking• Competency-based

2. Qualitative decision analysis3. Decision tree/cost benefit

analysis4. Work backwards

Hugh Courtney. 20/20 Foresite

Flaws in Traditional Strategic ThinkingFlaws in Traditional Strategic Thinking

• Overconfidence – going for the narrow answer

• Status quo bias – entropic effect of doing nothing

• Anchoring on recent events• False consensus – Abilene Paradox• Desire to conform• Entrapment in sunk costs

What is Level 3 and 4 Strategy?What is Level 3 and 4 Strategy?

• Strategy doesn’t try to explain the predictable (levels 1 and 2)

• Ambiguity and uncertainty are the flip side of opportunity

• Strategy is a decision on where you will place your bets

Business Strategy: Example Business Strategy: Example

We believe it will

We don’t believe it will

Reality is, coaching goes

mainstream

Reality is, coaching

doesn’t go mainstream

Revenue Stream

Long hard struggle

Lost Opportunity

No loss

Working Backwards?Working Backwards?

• Start with a strategy

• What do I have to believe about the future to support a defined strategy?

• Do I believe that is likely?

• Am I willing to bet on it?

Organizational Climate

Very Low Uncertainty Little Concern for Whole

Risk Aversive Boredom/depression

Suppression of Disagreement

Disrespectful of Academic

traditions

Sense of fiscal distress leading to layoffs

Command and Control style of

Leadership

Low estimation of quality

Centripetal Forces too Strong: Overcontrol

Inadequate fiscal

resources

Internal Conflict:

adm/faculty; faculty/facult

y

Unpredictable Markets

Faculty Autonomy

Lack of Trust

Weak Leadership

Unclear System

s

Tarnished Institutional

Symbols

Unpredictable actions by

Board

CENTRIFUGAL FORCES TOO STRONG: Chaos, High Crisis

Organizational Climate High Uncertainty

High Tension/Pain Risk Aversive Low Morale

Creativity

Faculty Autonomy

Unpredictable Markets

Internal Conflict

Inadequate Fiscal

Resources

Effective administrative

and fiscal systems

Clarity of Purpose; strategic

directions

Hope for a better Future Focus on

Institutional Values/Symbols

Governance Systems based on

Core Principles and Norms

Organizational ClimateClear Strategic DirectionsIdentification with WholeRisk Taking Encouraged

High Morale

Balance Between Centrifugal and Centripetal Forces: Creative Tension

ReflectionsReflections

• How do we sustain creative tension?

• How does the concept of creative tension play out in your ministry setting?

• How do we need to reframe our thinking?

What Is ‘System Thinking’?What Is ‘System Thinking’?• Seeing individuals and organizations as

participants in a larger system rather than as individual entities

• A change in one variable affects other variables over time, which in turn affects the original variable

• The Butterfly Effect: Small changes can lead to significant outcomes

• The system is complex and constantly adapting

Developing a Systems LensDeveloping a Systems Lens

• The whole is greater than the sum of the parts

• The whole determines the nature of the parts• The parts are dynamically interrelated• The parts cannot be understood in isolation

Systems thinking asks us to hold the whole in mind and to investigate the interaction of the component elements of the whole – all the component elements, not just the two or three most obvious and easy to examine and to investigate the relation of the whole to its larger environment.

Peter Vaill, Learning as a Way of Being

Linear Thinking• Cause and effect

occur together• Logical and rational• Detail complexity• Type I/II problems

and solutions

Heifetz’ Leadership as Adaptive WorkHeifetz’ Leadership as Adaptive WorkClarity of the Problem

UnclearClear

Clarity of the

Solution

Unclear and Unavailable

Clear and Available

Type I

Technical Work

Type II

Technical/ Adaptive

Work

Type III

Adaptive Work

Type IV

Wishful Thinking Wooden

Headedness

Linear Thinking• Cause and effect

occur together• Logical and rational• Detail complexity• Type I/II problems

and solutions

Systems Thinking• Cause and effect

are unpredictable• Relational and

dynamic• Dynamic complexity• Type III problems

and solutions

Key Principles of Systems ThinkingKey Principles of Systems Thinking

• System structure causes its behavior• Interrelationships cause their own crises: There are no

villains• The ability to influence change comes from

understanding the structures and relationships causing events and behaviors

• Changing system output requires changing system structures and processes

• Changing the output of human systems requires changing beliefs

• Learning is the process of changing beliefs• Changing system structures requires leverage –

creating change through highly focused action

LeverageLeverage

• Comes from new ways of thinking– Seeing structures instead of events– Processes of change rather than

snapshots– Changing the way people see things

rather than how they do things– When we see things differently, we do

things differently

Organization or Ecosystem?Organization or Ecosystem?

• Organization:– The “well-oiled machine”

• Ecosystem:– A natural community, including all the

‘members’ or participants in that community, interacting with each other and the environment around them.

““Organizational” ModelOrganizational” Model

A SystemA System

A system now appears to be a set of coherent, evolving processes which temporarily manifest in globally stable structures. (Jantsch 1980)

Lunch!!!!Lunch!!!!

• Enjoy lunch as a team

• Bring your project into focus

• Prep your ideas for an informal dialogue with the group

Order and ChaosOrder and Chaos

• All natural systems seek order

• Systems can very easily been thrown into chaos

• Thriving systems are neither ordered nor chaotic

Chaotic SystemsChaotic Systems

• Inherently action-oriented

• A sense of motion

• Impossible to predict

Chaotic SystemsChaotic Systems• Driving Need:

Survival• Crisis culture• Structural

fluidity• Focus on the

present• Accountability

avoidance• Kinetic energy• Highly

explorative learning

• What do you need to embrace in times of chaos?

• What do you need to let go of?• What sort of leader do you

need to be?

Leadership ReflectionLeadership Reflection

Ordered SystemsOrdered Systems

• Whole equal to the sum of the parts

• No incentive to change

• Members reach and maintain equilibrium

Ordered SystemsOrdered Systems• Driving Need:

Status quo• Process

culture• Protective

hierarchy• Focus on the

past• Accountability

to activity• Energy

brownout• Limited

learning

Leadership ReflectionLeadership Reflection

• How do you respond to rigidity and “order”?

• What do you need to embrace when things are orderly?

• What do you need to let go of?

• What sort of leader do you need to be?

Order and Chaos:Order and Chaos:What’s the Relationship?What’s the Relationship?

Chaos

Order

Complex Adaptive Systems

Simple Following a Recipe

• Recipe is essential

• Recipes are tested to assure replicability

• No particular expertise: knowing how to cook increases success

• Recipes produce standard results

• Certainty of same results every time

Complicated A Moon Rocket

• Formulae are critical and necessary

• Sending one rocket increases assurance that next will be okay

• High level of expertise in many specialized fields and coordination

• High degree of certainty of outcome

Complex Raising a Child

• Formulae have only a limited application

• Raising one child gives no assurance of success with the next

• Expertise can help but it is not sufficient

• Every child is unique

• Uncertainty of outcome remains

Source: Brenda Zimmerman PhD

Complex Adaptive SystemsComplex Adaptive Systems

• Driving Need: Survival

• Crisis culture• Structural

fluidity• Focus on the

present• Accountability

avoidance• Kinetic energy• Highly

explorative learning

• Driving Need: Status quo

• Process culture• Protective

hierarchy• Focus on the

past• Accountability

to activity• Energy

brownout• Limited

learning

• Driving Need: Opportunity

• Service culture

• Self-organizing structure

Self-Organizing SystemsSelf-Organizing Systems

Members of the system share an unerring recognition of the intent of the system, a deep relationship between individual activity and the whole.

What is a Complex Adaptive System?What is a Complex Adaptive System?

Self-organization is a fundamental principle of the universe… Open, self-organizing systems use energy, material and feedback (information) from their internal and external environment to organize themselves.

Kelly and Allison (1999)

Understanding ‘Boids’Understanding ‘Boids’

• Maintain minimum distance

• Match velocities

• Move to the perceived centre of mass

Complex Adaptive SystemsComplex Adaptive Systems• Driving Need:

Survival• Crisis culture• Structural

fluidity• Focus on the

present• Accountability

avoidance• Kinetic energy• Highly

explorative learning

• Driving Need: Status quo

• Process culture

• Protective hierarchy

• Focus on the past

• Accountability to activity

• Energy brownout

• Limited learning

• Driving Need: Opportunity

• Service culture

• Self-organizing structure

• Focus on the future

Accountability Accountability to to relationshipsrelationships

Focused Focused energyenergy

Highly Highly adaptive adaptive learninglearning

Fractals as MetaphorFractals as Metaphor

• Many natural structures (leaves, chemical crystals, river beds and spider plants) also exhibit fractal patterns

• Dress, norms, habits, or traditions all emerge as self-similar characteristics of organizations

• “Fractalization” can be intentional in human systems

Wheatley on Fractals….Wheatley on Fractals….

When an organization is willing to give public voice to information – to listen to different interpretations and to process them together – the information becomes amplified. In this process of shared reflection, a small finding can grow as it feeds back on itself, building significance with each new perception or interpretation. As with fractals, the simple process of iteration eventually reveals the complexity hidden within an issue.

FractalsFractals

• Mathematical metaphor

• Self-similarity

• Focus on qualitative

• Lessons of wholeness

The Fractals of the Human BodyThe Fractals of the Human Body

• Why does the heart beat produce musically pleasing note sequences?

• Heart beat variability is controlled by the nervous system

• Mathematical structure of a fractal

Personal implicationsPersonal implications

• It begins to shift the way we see:

– Ourselves– Relationships– Leadership

How do we keep together?How do we keep together?

What are What are the the Attractors?Attractors?

• Mission– The fundamental reason for being

• Values– Non-negotiable behavioral boundaries

• Vision– The preferred future when values are fully

evident and all are on purpose

Strange AttractorsStrange Attractors

We need to be able to trust that something as simple as a clear core of values and vision, kept in motion through continuing dialogue, can lead to order.

Meg Wheatley

Complex, Adaptive SystemsComplex, Adaptive Systems

• Agents interacting with each other according to specific rules of behavior

• Agents inspect each other’s behavior and then adjust their own

• System learns and evolves • Interacts with other complex adaptive

systems• Survives because it adapts• A “delicate” state of bounded instability

• Stacey (1996)

Bounded InstabilityBounded Instability

• A self-organizing system creates its own boundaries and preserves and renews itself over time (autopoesis)

• Punctuated equilibrium occurs

• Boundaries open to interaction with the meta-system

Systems DynamicsSystems Dynamics• Boundaries

– Defining parameters of a system– Bounded systems

• Clarity of boundary• Open system• Contained energy

– Unbounded systems• No boundaries• Non-systemic• Rapidly dissipating energy

Systems DynamicsSystems Dynamics• System condition

– Defining status of a system– Stable systems

• Equilibrium• Little or no energy• Risk of entropy

– Unstable systems• Flux and transformation• High levels of energy• Edge of chaos

(Un)bounded (In)stability(Un)bounded (In)stabilityBoundedUnbounded

Sta

bil

ity

Inst

abil

ityC.A.S.

• Highly adaptive

• Clarity of intent

• Energy creation

Chaotic System

• Mutation

• No specific intent

• Dissipating energy

Colonial System

• Rigid protocols

• Universality

• Controlled energy

Ordered System

• Non-adaptive

• At risk

• Limited energy

Implications for OrganizationsImplications for Organizations• Self-bounded

– Clarity of mission and core competencies

• Self-regenerating– Can replace people as they leave– Can replenish resources– Can add aligned people and functions

• Self-perpetuating– Strong culture maintains essence as people change– Organization supports people; people support the

organization