The one about inescapable complexity
On a new level of understanding
Friends,
I hope that all is well with you and yours, and that this e-mail finds you on a boat with shoddy connection, in the tropics, three months after I sent it.
I am back, baby! Today, we discuss the new theme: complexity as it pertains to life, business, and strategy. Specifically, I attempt to break down precisely why it is so immensely important to understand for anyone who wants to improve their work.
Now accepting keynotes for 24Q4-25Q2
Every year for the last decade or so, I have created three main presentation decks. For 2025, however, I have (for the first time) added a fourth due to popular demand. They are:
What to Do When You Don’t Know What to Do: How to turn change into a competitive advantage. (Based on the new book by the same name.)
Leadership in a Time of Change: How to steer an organization through a sea of uncertainty.
Resilient Retail: How to build a profitable retail business in the modern marketplace. (Based on the 2025 follow-up to the highly praised 2022 white paper The Gravity of e-Commerce.)
Artificial Intelligence Beyond the Hype: How to understand the narratives, risks, opportunities, and best uses of a new technology.
If you want to book me for your event, corporate speaking slot, or workshop, merely send me an email. To make sure I am available, please do so at your earliest convenience; my availability is limited and the schedule tends to fill up fast. More information may be found here.
A couple of updates before we go-go
A long time ago, in a life far, far away, I was very fit. In fact, I was athletic fitness competition level fit. But then along came life, work, kids, and all kinds of excuses that you tell yourself to feel less bad about the fact that your body starts to resemble an overcooked asparagus. And so, a month ago, I gave myself a metaphorical slap and decided to get back into proper shape.
While I am not, nor ever will be, one of those people who talks loudly about their training to anyone who is willing to listen and most who are not, I have to say that the endorphin kick that you get from doing the first properly heavy workout in years is bonkers. Eight hours it lasted. I was bouncing off the walls like a kid with ADD after five cans of Red Bull.
God, have I ever missed that feeling. Well, the energy boost at least.
Anyway.
A couple of quick notes on the markets:
Alphabet/Google recently released Deep Dive, a new AI tool that takes a piece of content and turns it into a podcast, complete with two hosts providing “insights” and “convincing banter”. The tech nerds of the circuit are already playing top trumps with their favorite, custom-made AI shows.
With the risk of coming across as a Luddite, I struggle to see why anyone in their right mind would want to spend time listening to a piece of software talking to itself. Having said that, I also expect to see marketers wax lyrically about how brands now can “unlock podcasts about their purpose”, why it will “engage their fandoms” and “create loyalty”, and, eh, something, something, something. At this point, I cannot even be arsed to finish the sentence.
Speaking of AI, the latest fundraising round for OpenAI raised $6.6B despite all the recent turmoil. The investors are now valuing the firm at a whopping $157B - a number that puts it on par with companies such as Goldman Sachs, Uber, and AT&T.
It is worth noting, though, that the current round has come with, shall we say, a small caveat: the investors will have the right to withdraw their money if OpenAI does not become a for-profit company within the foreseeable future (it is currently considered a “charitable nonprofit”). Altman is officially on the clock. Stay tuned.
Patagonia recently had to fire 41 people amid a “corporate restructuring”, citing macro economic headwinds. Two things worth highlighting:
Reorganizations are merely a reshuffling of employees to signal active management. As a result, they rarely lead to much of anything different.
I have highlighted the financial headwinds for a long time now. While the media is obsessing over whether the Fed will make interest rate cuts, the very real fact is that the economy as a whole may do well even as parts of it do poorly. Understanding the market forces most relevant to a firm, and how external events may or may not affect them, is paramount for any serious strategist.
On a similar note, Nike’s revenue fell 10% in the latest quarter - and profits were down 28% YoY. Company executives warned that sales could fall another 10% in the current quarter. I need to look at the financials to see precisely what might be to blame, but it is clear that Nike (including Jordan) sneakers are in a bit of a funk. To illustrate, sales on StockX fell 21% in H1 2024. Trades of main rivals Asics and Adidas, meanwhile, grew roughly 600% and 90%, respectively.
Moving on.
The inescapable complexity of life
A new level of understanding
Ever since the very first edition of Strategy in Praxis went out almost four years ago, I have tried to explain how complexity is an inescapable part of our daily lives - and how dealing with it in an organizational setting requires a brand new lens through which to view the world. However, as I look back upon my writing, I realize that the most important insights are spread out across hundreds of newsletters.
For many of the now several thousands of subscribers, making sense of the topic must, in other words, be a bit like trying to put together a puzzle with many of the pieces missing.
In order to set things right, I will therefore dedicate this autumn to give everyone an opportunity to get up to speed not only on what complexity is, but also where complexity science comes from, what it can tell us about the world, and how a grasp of complex adaptive systems enables a unique understanding of why things in business never work the way that we have been told they should. If I do it right, it will completely change how you see the world. I do mean that.
And so, without any further ado, let us begin.
The term complex is usually used in popular discourse to describe something which is very difficult to understand. Following this argument through, the opposite of complex would be simple, and reducing complexity a worthwhile endeavor.
However, the etymological root of the word is the Latin plexus, which means braided, entwined, or interwoven. Complexus translates to “braided together”. Is this the opposite of “simple”? No, self-evidently not. Complexity is thus not a higher state of complicatedness, but in reality something altogether different: it is the interconnected and entangled nature of things.
The entanglement has always been a core feature of life; human beings have had to deal complex phenomena since the birth of our species. Scientists have also long been aware of them – they constitute a fundamental (if implicit) part of Darwin’s theory of evolution, for example, and adjacent fields such as systems thinking go back to antiquity and beyond – but it was not until relatively recently that science was advanced enough that complexity could become a field of study in its own right.