Leadership in Complex Environments

Leadership in complex environments moves beyond simple knowledge and more into understanding the dynamic aspects of internal and external systems. Those executives that understand their environment and have developed strategies for dealing with contingencies are more likely to successfully adapt their organizations to changes versus those that do not/cannot. When one has a keen eye on internal and external markets, they are much more likely to find solutions.

One of the very first steps is to gain knowledge about the environment and the trends. It is important to continue to read, understand, learn, assess, and reflect so as to be aware. Strong executives know their business inside and out and can gauge internal resources to deal with such issues. They know what they are strong and weak, available resources, and who can do what.

There are specific methods such as the study below that help us understand change and risk to organization. For example, if you rely on specific widgets but only one supplier you are going to have an issue if that delivery is going to stop. Further, if there is a shortage of a specific skill in the market then the organization must either change its process or develop the skill (internal, external, higher ed, etc.).

The first piece discusses complex systems and understanding how to avoid risks from an organizational perspective. Companies exist in an international world and there could be things ranging from supply chain to internal labor shortages that might constitute risk. Leaders will seek to understand the risks and can do so through review and risk analysis. Once they know the risks they can strengthen and patch weak areas of an organization (It is possible to play devil's advocate to strengthen systems).

Advancing the complex adaptive systems approach to enterprise risk management with quantified risk networks (QRNs)

Social networks are also part of a complex system and can have an influence on economics. For some time, I have been discussing the sociological aspects of society as tied to economic/societal health (i.e. economics as social choice). Things like corruption, hate, social in-groups, and bribing damage the system on a deep root level. Leaders understand the long-term necessity of ethics in their businesses and encourage an environment that is most conducive to upholding social contracts, free exchange of ideas, and social trusts to foster pro-growth economic environments.

Rethinking leadership in complex adaptive systems