Tangled Webs and Executive Naivete

Leaders in a digital world have to navigate more complexity than ever before. This demand on their role requires them to avoid believing they are omniscient, to seek broader — rather than deeper — knowledge, and to be clear about their strategic intent.

Complexity in a situation increases when many interconnected factors influence each other. Digital technologies create complexity by distributing work over time and across geography. Multiple non-colocated teams, groups, and companies collaborate without necessarily knowing how, why, or how much the content of their work (such as “design of the dashboard”) or the attendant conditions (“must be delivered on …”) affects others.

For example, in the auto industry, over 40% of a typical car is designed, and over 70% manufactured, by companies whose names consumers don’t ever see. Each organization executes its own tasks, expecting the company whose name is on the car to oversee the big picture. This assumption may not hold because the relevant big-picture information simply may not exist. This happens when novel intellectual property with many unknowns is created, or when people are drowning under overflowing in-boxes, or when blind spots exist in available information because no one has acquired information that, in hindsight, was crucial. Conversely, the company whose name is on the branded product may expect its suppliers and other key partners to inform it of anything that requires attention. That assumption too, may be optimistic: Many times, partners have contractual incentives to not disclose bad news early.