Simple Complexity: a Management Book for the Rest of Us, a Guide to Systems Thinking

by William Donaldson

This book is about applying the principles of complexity and systems thinking to management. “Every organization is a system—in fact, a system of systems, perfectly designed to get the results it is getting today… Systems thinking is the unifying discipline that brings clarity to all of the other disciplines at work in your enterprise… The key, defining concept of systems thinking to remember is that nothing in the system is ever unconnected.”

Donaldson emphasizes the importance of context. “You have to ensure everyone has shared mental models of the enterprise and its management system… Remembering that context can enhance learning and comprehension by 50-100 percent, you must give employees context for both the part of the system they play a role in and the whole system.”

“The basic system components are—purpose [or function], elements, and interactions.” The author uses the word holon extensively. “A holon can be anything in the system, an element, a team, a process, an individual.”

“Your enterprise system… converts inputs—time, people, and money—into outputs—goods and services… To increase system throughput one must relieve the bottleneck. However, since there will always be a constraining part of the system, the bottleneck will merely migrate to another part of the system… You must always realize that any change will inevitably have consequences somewhere else in the system. It has to. It is all connected.”

“Unfortunately, most managers and companies, acting according to bounded rationality, try to optimize every individual node, function, process, or holon within the system… Point or local optimization is often counterproductive, the time lag in the system hides the root cause, and the result is suboptimal total system throughput. You must optimize the system, which usually entails suboptimizing one or more points in the system. This is highly counterintuitive and is at odds with much of the management advice dispensed, in fact with how management is taught.”

“Think in terms of holarchy not hierarchy… The upper layers serve the lower levels and vice versa. Sales people in the field, service representatives, assemblers on the plant floor, and relief workers in a camp are the front line of the enterprise where the real work is accomplished. The upper levels exist to serve the lower levels.”

“Real understanding and success at the higher levels of the holarchy require the addition of different leadership dynamics—thought and emotional leadership. Thought and emotional leadership are very different from action leadership. They require different skills—skills such as listening, probing, reflecting, guiding, and monitoring. Thought and emotional leadership are quiet skills. They are required to sense and elicit the beliefs and philosophic basis for policies and practices.”

“In the system, it is possible for an element or holon to be both critical to success and impossible to measure. One must sense the amplitude and direction. The soft systems skills are just as important as the hard systems skills, perhaps more so.”

“Your corporate culture is an emergent property of the system… It can be positive or negative. Corporate culture reflects the totality of the habits, beliefs, practices, values, behaviors, and actions of the enterprise and its leaders… It is in large measure responsible for the level of commitment found in your employees… A powerful, positive company culture is a force multiplier that emboldens all occupants and can differentiate your enterprise in this competitive world… Culture works in concert with purpose to connect with employees’ hearts and minds… If management cannot engage hearts, the system runs the risk of being barren and soulless… Signs that an enterprise’s culture is in trouble will be readily apparent and constantly transmitted due to the connectedness of the system.”

“You must adopt a philosophical shift from training your employees to developing them, which may include training. You must make sure your employees are actually learning and developing the skills required, not just for the job, but also for the system. If you only train them in the job, they may dutifully perform, but not know why they are doing the task… Engaged employees sense a real connection to the information and the energy of the system and the purpose of the system.”

“Occupants of the system will formulate assumptions from your actions and words that may not reflect what you intended… Often issues that seem immovable are artifacts of long-standing assumptions that over time have come to be perceived as bedrock.”

“The most powerful technique for effective delegation is to have simple, straightforward discussions with all employees about the key inputs that define their holon and area of freedom… One of the great benefits of these sessions is the rich engagement that occurs in doing so. Employees feel valued and respected, and management can learn a great deal about employees. Together you can complete the hermeneutic circle and surface many surprising assumptions.”

“You should not cede authority to those who are not ready to accept it. However, too small an area of freedom for accomplished, capable employees will feel restrictive and controlling…  A rigid system based on controlling behaviors is a recipe for disengaged employees.

“The environment in which the enterprise operates is constantly changing. Therefore, the systems and processes that are fundamental to delivering goods and services to the environment must also be changing if they are to be effective. Hence, structure must follow strategy. However, structure is an area where stasis is particularly acute.”

On planning, Donaldson quotes Peter Senge: Planning is “the process whereby management teams change their shared mental models of the company, their markets, and their competitors. For this reason we think of planning as learning and of corporate planning as institutional learning.”

“You should conduct your reviews regularly throughout the year…

  • Has anything in the external environment changed that would indicate a change in our current plan?
  • What is working as planned? Should we do more in areas of progress or success?
  • What is not working according to our plan? Is it a result of our performance or an externality? What are we going to do to change or recover?”

On change, the author writes, “The only way you can manage change is to create it. By the time you catch up to change, the competition is ahead of you.”

On innovation, he cautions, “Creativity and innovation are seldom efficient. Additionally, the corporate culture must support the often messy unpredictable nature of creativity and the innovation process. Often in their desire to manage for predictable, repeatable results, corporations systematize out creativity, and innovation capabilities.”

Systems thinking is about the understanding the big picture. It is the antithesis of myopic thinking.

Donaldson, William. Simple Complexity: a Management Book for the Rest of Us, a Guide to Systems Thinking. New York: Morgan James Publishing, 2017. Buy from

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