Anthropologist Joseph Tainter writes, “Complexity creeps up on you.”  Today, complexity has been creeping up and overwhelming us.  Within our companies and in our personal lives, we need to fight hard against this complexity to enable us to realize our goals.  As Schumpeter writes in The Economist:

“The biggest threat to business almost always comes from too much complexity rather than too much simplicity.”

The Danger of Complexity

Much of the complexity in today’s world is needless.  This complexity taxes us mentally, diverting our mental capacity away from other, more important areas.  Complexity also allows others, who understand the complexity, to take advantage of us.  An excellent example of both these trends is medical billing.  Who does not get exhausted trying to understand medical bills with initial over-charging, insurance, deductibles, and co-payments? When it gets too complex and confusing, we often just pay the bill even when it might not be correct.

All this complexity creates stress and anxiety, as we deal with something we don’t understand and feel ourselves being taken advantage of.

Why Is Everything So Complex?

Complexity exists for several reasons:

• Negotiations and Compromises: This is why government regulations, laws, taxes, and business contracts are far more complex than they need to be.
• The “Just One More” Factor:  I have often discussed the need to start out simple with the caveat that “we can always make it more complex later.”  While good advice, the initial, simple idea or product gets more and more complex as we keep adding more to it.
• Lack of Re-design and Re-consideration: As Steve Jobs wrote, “When you first start off trying to solve a problem, the first solutions you come up with are very complex, and most people stop there.  But if you keep going and live with the problem and peel more layers of the onion off, you can oftentimes arrive at some elegant and simple solution.”
• Incentive: Consultants, law firms, accountants, and lobbyists create and thrive on complexity to fuel their business and make us need the services they are providing.  As Jonah Goldberg writes, “The upper class in this country is making the rules of the game more complex.  And the problem can be simply stated: Complexity is a subsidy.  The more complex government makes society, the more it rewards those with the resources to deal with that complexity, and the more it punishes those who do not.”
• Business Education / Training: As Warren Buffett writes, “Business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective.”
• Our Expertise: “Familiarity with a particular area or domain leads to a particular kind of myopia that diminishes the ability to see creeping complexity.”  Alan Siegel
• Profitable: Complexity, as in the medical billing example, is profitable.  It allows companies to confuse customers and charge them more with incorrect or hidden pricing, add-ons, and additional services than they would in a simple world.

What Can We Do?

In a perfect world, we would be able to simplify regulations, laws, taxes, and business contracts.  Unfortunately, we cannot control the government and there are too many people leeching off complexity to see much change anytime soon.

But we can focus on our business and ourselves and work to keep them as simple as possible.

• Focus on keeping things short and simple (even if not perfect).  Most concepts and actions in business do not need to be perfect; they just need to be good enough.  So, aim for the simpler and good enough solution. 
• Put ourselves in our customers’ shoes and try to make it as easy as possible for them to do business with us.  Two good examples of being simple and easy to do business with are Southwest Airlines and Amazon.
• Avoid the “just one more” problem.  As we start out with something simple and begin adding to it, we need to have the courage to subtract less important features or arguments as we add other features or arguments, ideally one for one – eliminate one feature for every one feature added.
• Simplify our product and service offerings.  In a 2006 study from Bain, “Reducing complexity and narrowing choices can boost revenues in companies by 5% – 40% and cut costs by 10% – 35%.”
• Eliminate all low value-added work and activities, especially focusing on eliminating work, reports, or activity that we may need ‘just in case’… as opposed to work, reports or activity that we use regularly in our lives and businesses.

Conclusion

“Any intelligent fool can make things bigger, more complex, and more violent.  It takes a touch of genius — and a lot of courage—to move in the opposite direction.”  E. F. Schumacher

In the end, the simpler that we make our businesses and our lives, the better, more profitable, and happier we make ourselves, our employees, and our customers.