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Complex projects – The challenges - Interim management What distinguishes complexity from complicated? Why should companies be seen as complex systems? What is the role of managers in managing complex projects? Why is it effective to entrust complex projects to interim managers? These are the questions we seek to answer in this article.

Complex projects – The challenges

What distinguishes complexity from complicated? Why should companies be seen as complex systems? What is the role of managers in managing complex projects? Why is it effective to entrust complex projects to interim managers? These are the questions we seek to answer in this article.

The Cynefin decision system

This approach, which originates from the work of Welsh management consultant Dave Snowden, aims to help managers identify the type of problem they are facing. This framework is useful in understanding the meaning of complexity. The Cynefin framework divides problems into four main categories:

1. Simple: these problems are obvious and easy to solve using a rules-based approach. Simple here does not mean that the problem is trivial, but that the solution is obvious.

2. Complicated: more complex problems require expert analysis and interpretation. Although there are several possibilities, all can be identified and understood. Here, complexity arises from the need for several well-defined elements to match perfectly.

3. Complex: problems can be unpredictable because they involve many dynamic interacting factors. Complexity in this case arises from multiple interactions. These problems require understanding and adaptation, low-risk experimentation, as changes and feedback constantly shape the system.

4. Chaotic: situations in which immediate action is required as there is no point in analysis. Such problems require rapid decision-making and intervention without reflection.

These four categories effectively represent different environments in which individual solutions must emerge.

The Stacey Matrix

British organisational theorist Ralph Stacey's matrix is used to analyse different types of project and management dynamics. It has two main dimensions:

1. Uncertainty about the objectives, i.e. to what extent are the project objectives clear or unclear?

2. Uncertainty about the means, i.e. how clear or unclear are the means and methods by which the objectives can be achieved?

The Stacey matrix (which most closely resembles a coordinate system) is a simple visual tool for representing and managing the complexity of projects. It helps teams navigate uncertainty and coordinate the most appropriate approach to project implementation. It is composed of two axes: the approach (x-axis) and the requirements (y-axis). The requirements show what to develop, while the approach shows how to develop. It is commonly used in software development and IT consulting to define the complexity of a project or task.

The use of a matrix allows managers to understand which factors are complex and which are complex, and to tailor their strategies accordingly.

Complicated vs. complex systems

In Hungarian, these two terms are very similar, but in the world of project management, it is important to emphasise the difference between them. To do this, we first need to define their meaning.

Complex systems are composed of several well-described parts that work together in a specific way. These systems usually require expertise, but they operate according to defined and repeatable patterns. For example, the assembly of a car engine is complicated but not complex: the parts are well-defined and if the defined procedure is followed, the result is predictable. For complicated systems, analysis and detailed design are key.

In contrast, in complex systems, the relationships between the details are so dynamic and interactive that the outcome cannot be predicted. These systems are adaptive and constantly changing. For example, the operation of a company is complex because the relationships between people, technologies and markets are constantly changing. In this context, corporate complexity and business complexity are a daily challenge. One of the biggest challenges in complex systems is to continuously adapt and maintain adaptability.

Once we have separated the two terms, we can look at their application in business.

Companies as complex systems

Companies are complex systems that cannot be fixed like a machine. Because of their organisational complexity, they should rather be seen as living organisms whose performance and growth are determined by complex factors. So, the functioning of a company is more like a biological system than a machine. An apt analogy is the complexity of a rainforest, where a multitude of intrinsically complex organisms live in complex interactions with each other to form a uniquely complex system. In this approach, the meaning of enterprise complexity is that the complexity and dynamism of the system require understanding and continuous adaptation. To manage enterprise complexity, particular attention must be paid to harmonising environmental factors and internal processes. It is often the internal, organisational complexity that raises new challenges, while business complexity requires a different approach.

The responsibility of managers to manage complexity

In project management, managers must understand the difference between complexity and complexity. It is not enough to have expert knowledge; managers must also recognise the system dynamics and how to adapt strategies to constant change. Recognising business complexity and managing the structures that build on it is critical to this process.

Some rules for managing complex systems

John M. Kamensky, a senior fellow at the IBM Center for The Business, outlines in a paper three key methods for managers to manage the "chaos" and uncertainty that comes with complexity.

First, managers can take several steps to increase their predictive capabilities in a complex environment. 

Second, managers need to choose better risk management strategies. A good example of this is the practice of analysing a data series through the lenses of several different specialists (one as an economist, the other as a lawyer). This reduces the risk of only one perspective dominating the analysis of a problem.

Third, smarter trade-off decisions are needed. For example, the leader should ensure the diversity of the management team. This can make it difficult to make quick decisions but generally improves the quality of longer-term decisions. 

It can be seen, therefore, that in a modern, complex business environment, theories that can be put into practice can be of great help, especially if they provide managers with a visual tool. Many of Kamensky's tips are geared towards internal cooperation. A good manager, he says, listens to what his colleagues want, spreads more responsibility across the organisation, and makes smart rules to ‘bring the company closer to the future’ - at least that's how employees will feel and give their maximum effort to solving problems.

The role of interim managers in solving complex problems

In today's VUCA-BANI world, the complexity of the business environment has reached unprecedented levels and has further increased the complexity of corporate projects and problems. In this situation, managers play an even more important key role. In such cases, help often comes from the outside in the form of an interim manager with decades of experience in solving complex problems, a fresh perspective on the problem and an immediate solution to complex projects and problems such as developing a new product, implementing a new quality system or resolving a protracted crisis.

Perhaps your company has faced situations so complex that a novel solution is needed - not at the project manager, but at the executive level. Interim Ltd. has been helping to resolve such situations for more than 20 years with its interim management services. Interim managers can even overcome the organisational complexity problems that arise from corporate complexity: they take a fresh, outside look at your company's problem, help you find a way out of it and see it through.

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