Last Tuesday, at my Rotary Club, we had a speaker, Doug Garnett, who presented on complexity in business. He said that there is a common perspective in business that deconstructs the business system into parts and pieces (sales, marketing, ops, etc). The underlying assumption is that if you can get the parts healthy, the business will do well.

Doug disagreed with this approach because businesses are complex systems. One of the ramifications of being a complex system is that businesses produce synergistic effects (positive and negative). The whole is greater than the sum of the parts. Innocuous changes to the parts, like moving a weekly meeting to a different day, can have odd effects on how the entire system performs.

It’s an interesting perspective. What could it mean for your business though?

He said that you should still manage the parts of your business, but you should focus more on how the business operates as a whole. In particular, what you’re looking for is anomalies in profit (profit being the primary measure of the whole system.)

Changes may not have a clear rationale, like moving a meeting to a different day, but as long as your sensitive to the whole business system, you can still profit from them.