Dave Snowden is a consultant and researcher in government and industry specializing in complex issues and how they relate to strategy and organizational decision-making. He has pioneered a science-based approach to organizations through anthropology, neuroscience and complex adaptive systems theory. Listen in on how to approach complex issues in your business.
What we cover in this episode:
- 02:42 – What is Sense-Making
- 08:06 – The Cynefin Framework
- 13:40 – Using human judgment
- 16:21 – Marketing to the 2.5% vs 13.5%
- 18:17 – Data sciences
- 20:13 – The market of complexity
- 25:57 – Context and complex
What is sense-making?
We all know that punctuation matters; Dave gives us an explanation on why the hyphen matters in sense-making. “So there are five schools of sense making… The one I belong in uses a hyphen, and whether you have a hyphen or not actually matters. If you have it as a single word, it’s a noun; with a hyphen it’s a verb. And I define sense-making as how do you make sense of the world so that you can act in it?”
With a background in physics, Dave utilizes cognitive science, complexity science and humanities to process knowledge about human decision making. Why do we do what we do? Why do we do what we do, especially when it comes to business. Whether it is starting up your own business, buying a business or running someone else’s business, sense-making comes into play in business and in everyday life.
The Cynefin Framework
Snowden helps breakdown the Cynefin framework by differentiating systems. “Fundamentally in nature there are three types of systems: ordered systems, complex systems, and chaotic systems… So an ordered system has such a high level of constraint that everything is predictable. A complex system, as I said, is entangled. So the only thing you know with any uncertainty is that whatever you do will have unintended consequences… A chaotic system is one in which there are no effective constraints.”
Using human judgment
A big trend we are seeing in the world is this tendency to automate and test AI within many processes. Dave talks about how AI plays a major role in business decisions and the everyday world, but not to forget the importance of intuition and important human judgment. Using logic and human decision making can go a long way in the development and advancement of your business.
Taking this a step further, there is a distinction Dave makes between AI and consultants. AI is like using a recipe, without input for nuance, whereas a consultant is able to approach a meal as a chef, taking more things into consideration. There is no recipe for success if you don’t understand the ingredients and what makes up the recipe. Being the chef lets you understand start to finish, all components and why they are used. This helps with understanding the complexity in business.
Dave adds, “I think part of the issue is companies, they don’t realize that they’re living a journey lots of other people have lived and you can’t follow somebody else’s journey. Everybody’s journey is to some extent, unique because of the context in which it is created. I mean, to require this as a small business, you’re actually better off scientifically going with your instinct.”
Marketing to the 2.5% vs 13.5%
When asked what we can do to try to overcome issues in our business and avoid failure, one of Dave’s tips was to read Crossing the Chasm.
“So… two and a half percent of the market will always buy something new…And you don’t wanna sell to those guys. They’re a right bloody pain because actually they know better than you do what your product should be…What then happens is you get this chasm in which nobody buys for a bit before you hit what’s called the early majority, which is about 13.5%. They buy what it will do for them, not how it does it.”
Being able to “dominate” this 13.5% of the market can help with conquering complexity in your business. What happens next is figuring out how you can do this, and how you can do this efficiently and effectively pertaining to your product or service.
The market of complexity
“We’ve spent 15 years creating a market for complexity and we’ve had to be very patient. Two things triggered it. One was Covid, made people aware of complexity. Secondly, the European Union commissioned me to write a handbook on how to manage complexity. So that gave government credibility.” The EU Field Guide is available here if you’d like to review.
“This is why you really need to have the theory in order to do the practice. Because if you got the theory, you can handle novelty in the situation. If you haven’t got the theory you’re just gonna repeat what you did last time or what other people you know did, and that’s a very haphazard pathway.”
Context and complex
One of the key takeaways from this episode is that Dave recommends having a sense of direction rather than goals. He articulates, “So in complexity, you can’t know what the future is. One of the key things we say about complexity is you start journeys with a sense of direction, you mustn’t have goals.” This is a key to conquering complexity in your business and your life goals.
“There isn’t a single context-free way of making decisions.” There are many complex terms and ways of thinking that are introduced in the entrepreneurial realm of building a business and achieving goals.
What seems like a complex way to make things simple, is actually pretty simple. There is no doubt being a human and especially being a business owner, doesn’t make you over think. Break it down, and figure out how and why, and maybe business complexity isn’t so complex after all. Dave leaves us with some great words to live by, “Follow your passion, I think is the word. If you believe in something, you can make it happen.”