World we live in today and to a large extent are responsible for having created, is full of complexities. Various kinds of unkind complexities! There are complexities in politics as there are in economies and so there are in trade, banking and commerce as well. There are complexities of one kind in manufacturing a product and there are complexities of another kind in the services associated with manufacturing and shipping that product to the point of consumption. There are jobs that are complex to perform and there are procedures that are complex to execute.
Complexity is relative. Skills define the relativity of complexity. Technology is the tool intended to be used for managing complexity. And Simplification is the goal. A goal that, however desperately sought, seems to be eternally elusive. “Let us try and simplify it” is a phrase we hear and use quite often. As cliché as it may sound, simplicity in its various forms is deservedly earning increasing attention.
The historical tax reform in India, Goods and Services Tax (GST) is already into its second year. It was hailed as ‘Good and Simple Tax’ by Prime Minister Modi at its midnight launch between 30 June and 01 July 2017. GST Network (GSTN) Chairman Ajay Bhushan Pandey recently said the Centre will be using the second year to bring about further simplification in the system. This simplification of the complex cascading multiplicity of taxes is the gist of this historical reform.
The big jump of 30 places last year in Doing Business ranking is a result of another such simplification initiative in India. The Doing Business Report 2018 of World Bank credited India for taking several measures to boost its ranking. They mainly included capital infusion of about $32 billion in public sector banks, introduction of the Bankruptcy and Insolvency Act, 2017 for easy exit or revival of a business and also for ease of financial institutions and banks to deal with NPAs (Non-Performing Assets) arising out of failed ventures and implementation of the Single Window Project SWIFT (Single Window Interface for Facilitating Trade) launched by Indian Customs to facilitate Trading Across Borders in India by allowing importers and exporters the facility to lodge their clearance documents online at a single point only.
Complexities in business mainly stem from independent, interdependent and interconnected systems and processes. The need for solving problems arises out of complexity. And complexity is lack of simplicity. Solving problems, therefore, is equivalent to introducing and implementing simplification in a complex process. Simplification that either maintains or enhances operational efficiency.
A process is complex because of the rigorous interactions of several parts or components of it. Various processes across functions within an organization are complex. Inherently complex. But what often make them more complex than they inherently are, are conflicts arising out of differences in opinions, perceptions, perspectives, positions, approaches, hierarchies, KPIs (Key Performance Indicators), limits of capabilities and cognition, levels of motivation, and most importantly the lack of willingness and the inability of leadership – in making, owning and implementing timely decisions – dwelling and decaying in organizations. While the former can be managed with scientific methods using business process reengineering, probability analysis, statistical mechanics and collaborative technologies, the latter and the more difficult part than the former to manage needs professional training on and implementation of collaborative behaviours, strategic convergence, decision support systems (DSS) and most importantly skills development.
One of those strikingly witty, and my personal favourite, statements of the great scientist philosopher Sir Albert Einstein is, “Everything should be made as simple as possible, but not simpler.” It says all about the inherently complex nature of phenomena that human mind may have limitations comprehending in entirety. And that is the difficulty in simplifying anything complex. But Sir Albert Einstein also famously said, “In the middle every difficulty lies opportunity”. Specialized skills need to be developed for simplification of complex processes. And that is opportunity.
I will further expound my thoughts and propositions on this very important theme in my forthcoming posts, but on the eve of Indian Independence Day celebrations, this one in particular is a tribute to the Father of the Nation, Mahatma Gandhi, an embodiment and epitome of simplicity.