Organisational Intelligence

Managers are often intimidated by the increasing complexity of their operating landscapes. Organisational value chains today are too wide and too deep to understand, let alone control. The tendency therefore is to outsource this problem to someone else, so there is "one neck to throttle if it goes wrong". The trouble with this approach is that managers tend to believe the contract (or plan) represents a reality that is foretold — "if it's in the contract then it must happen that way". But this usually leads to disappointment and disputes as unknown unknowns cause problems that could not be predicted in advance.

Outsourcing has earned a bad name — yet the truth is that the problem isn't outsourcing, (or the contracts) it's the way we apply this single approach across a very broad system containing both novel components (on the left of the Map, which shouldn't be outsourced as they're highly-uncertain) and industrialised components (on the right, which can and should be outsourced as much as possible). In order to manage value chains better and avoid the pitfalls of outsourcing managers need to learn the details about their landscapes by breaking them down into smaller contracts (and using small teams to manage them).

Think Small (in contract terms)