A theme for the 2019 World Economic Forum’s (WEF) annual meeting in Davos, Switzerland was the “Fourth Industrial Revolution.” It was concerned with how a combination of technologies are changing the way we live, work and interact. Few people in attendance could imagine how quickly the ideas would transition from an emerging trend to thrust upon us.
The term “Fourth Industrial Revolution” was coined by Klaus Schwab, founder and executive chairman of the WEF in 2016, and refers to how technological changes are drastically altering how individuals, companies and governments operate. These, in turn, lead to societal transformation through impacts on the way we live, work and interact. COVID-19 converted the conversations and presentations into our present-day lives.
Schwab explains it as a technological revolution that is blurring the lines between physical, digital and biological spheres. It involves technologies like mobile devices, AI, IoT, healthcare and biometrics. Today, wearable devices—like the Garmins and Apple watches that measure blood oxygen levels, along with contact tracing apps for COVID patients—illustrate the trend.
You have heard of boom towns; now we are seeing the explosive growth of Zoom towns. With more people given the option to work remotely, people are moving to the coast, the mountains or that quaint arts town. That’s a Zoom town, somewhere better to live because of easy access to recreation, scenery, hobbies or just a more cost-effective location.
COVID-19 has created some clear winners and losers in business, and it will be interesting to see if the trends continue after a vaccine gains sufficient adoption. The term “K-shaped recovery” has been coined to describe the divergence of fortunes.
The letter “K” has one stroke trending down like the businesses negatively impacted, and one trending up. Airlines, gyms and restaurants have been affected terribly. Yet, online shopping, credit cards and streaming services have seen business and profits soar. Will things return to how they were, or has widespread digital transformation been given a 5 to 10-year acceleration?
While things should stabilize, when a disruptive force enters the market place, it is rarely the same afterward. Organizations will not unlearn what they learned about office space cost savings. Nor will businesses be the same. While COVID-19 impacted all business around the same time as lockdown, the recovery rates will likely be desynchronized.
It will also be a lopsided recovery. White-collar office work will recover before blue-collar service work. Organizations working remotely do not need as many security, maintenance and cleaning service workers. Transportation and food service jobs are also depressed. Unfortunately, these traditionally lower-paid workers will feel the effects for longer than digital office workers.
From Managing Change to Navigating Complexity
The term “managing change” is not currently helpful. It implies there is an ordered process to it—and best practices to apply in our environment. In fact, there is too much uncertainty to reliably predict cause and effect. We need a better thinking tool.
Dave Snowden’s Cynefin model is just that—it is a thinking tool or conceptual framework. Cynefin is a Welsh word for habitat, and it helps us make sense of our environment.
The Cynefin model describes a continuum from region 1) Simple environments, where cause and effect are predictable and best practices apply, all the way through to 4) Chaos and 5) Disorder. As situations move from the Simple domain into 2) Complicated and 3) Complex environments, we may not be able to predict why things happen at the time, and they may only become explainable afterward.
Probably few people made the connection that a global pandemic would lead to record bicycle sales. However, in hindsight, it seems a logical outcome from closing gyms and restricting team sports.
As complexity rises, best practices disappear as there is no universal best approach. Instead, what to do very much depends on the situation. Lean startup, design thinking and agile approaches work well in the Complicated and Complex domains. With their short build-feedback cycles, they explore a solution space via experiments that probe, sense and respond to success and failure. Instead of best practices, they supply a set of useful practices that could help us.
As uncertainty rises further, cause and effect are not predictable in advance. So instead of describing this whole landscape as managing change, perhaps a term such as “navigating complexity” is more appropriate.
Many people associate the Project Management Institute (PMI) with working in the 1) Simple domain for knowable-projects and recommending best practices. This is indeed its origin and focus, but it also provides guidance for more complex environments.
Navigating Complexity: A Practice Guide is a good starting point. It provides models for combining critical thinking with assessment tools and useful practices to help deal with varying levels of ambiguity, such as the model shown below:
What Happens Next
We can’t put the genie back in the bottle. We are looking at an increasingly digitized future. We will also see continued change as the social impacts of different behaviors play out in the market place.
It is reasonable to ask, “What does any of this have to do with project management?” and I can only answer with “Nothing and everything.” It will impact our workspaces, our teams and the types of projects we work on. While the changes are at the macroeconomic level, the impacts are experienced every day by everyone.
Digitization, deurbanization, divergent recoveries will shape the next 5 years. Much of the transformation, revitalization and growth will be accomplished through projects. Project managers can help organizations recover and prosper by navigating the complexity and mastering remote, digital-focused teams and tools.