There’s an increasing amount of research on organisational complexity. Below we have shared a selection of the most relevant. These have been broken down by:
- The complexity trend
- Internal complexity symptoms
- Impact of complexity on people and engagement
- Impact of complexity on organisational performance
All sources are hyperlinked and in bold.
The complexity trend
Internal complexity [‘complicatedness’] is growing at 6.7% per year.
Internal complexity is growing six times faster than external complexity.
In the last 15 years:
- Number of procedures, vertical layers, interface structures, coordination bodies and decision approvals in organisations have increased by between 50% and 350%
- Number of emails received per day has trebled
- Time spent reporting information has increased by 40%
Internal complexity symptoms
Non-value adding work:
- 30% of front line staff time is spent on non-value adding activity
- 40% of management time is spent on non-value adding activity
In the 20% most complex organisations:
- Managers can spend 40% of time reporting information
- Managers can spend 30% – 60% of time in internal coordination meetings
Managers can spend up to 28% of time writing and reading email.
Up to 50% of time spent on email and in meetings is ‘unnecessary’.
Impact of complexity on people and engagement
Complex organisations are three times more likely to have disengaged people.
62% of employees in simple companies are brand champions.
74% of people believe their work environment is ‘very complex’ or ‘complex’.
71% of companies said simplification is ‘important’ or ‘very important’.
Impact of complexity on organisational performance
Simple companies are 61% more likely to be recommended by customers.
Organisations with the lowest complexity grow 30% – 50% faster than their average competitors.
The stock prices of simple organisations have grown 443% in the last 7 years vs. 52% for the FTSE and 106% for the DOW.
64% of customers are willing to pay more for a simpler experience.
Takeaway: From every way you look at it, being simple pays more than being complex. Gut feeling is backed up by unequivocal data. The complexity problem is getting worse for organisations. And those who arrest that trend by seeking to simplify will be more successful than those gripped by inertia or obliviousness.
What’s complexity costing your organisation?
Take our Complexity survey here.