Your articles - August 2010
Bruce Garvey (MBA 1973) and Nasir Hussain (EMBA 2007) 
The Wicked World of Cass Alumni
Nasir Hussain and Bruce Garvey first met as committee members of the Cass Entrepreneurs Network (CEN), some four years ago. Nasir completed his EMBA in 2007 following a successful career in the pharmaceutical sector as both an academic (he has a PhD in the health effects of nanotechnology) and as a practitioner in the biotechnology industry. Bruce on the other hand, by his own admission claims to be one of the “golden oldies” having obtained his MBA so long ago that the business school was then known as the Graduate Business School of City University and the programme was a MSc in Administrative Sciences – OK it was the early 70’s.
In 2007 and 2008 Bruce was conducting research into the difficulties associated with SMEs (and in particular early stage businesses) and the challenges they face in order to survive and thrive. The scope of the study prompted questions such as: What are the real barriers to growth facing SMEs compared to Large Scale Enterprises (LSEs); and significantly, is it possible to create a model of the firm/organisation which incorporates time horizons, relevant performance criteria etc., while continuously being impacted by external events over which it had no control; further could such a model be scaled across a wide range of organisation profiles from SMEs to LSEs?
It was this last set of questions which led Bruce to re-consider using a technique he had come across in the 1970’s whilst working in various forecasting and planning management roles at Xerox. This technique had the rather daunting title of “Morphological Analysis” (MA), but in essence belied a simple creative thinking method. However, whilst the method seemed to work well when the core parameters formed the three axes as in a cube – or 3-dimensional space – Bruce found that to address the problems he was looking at required more than three parameters! In practical terms this became extremely complicated when additional parameters (and the conditions or states contained within each parameter) were included: the potential outcomes (or combinations) grew exponentially to a level where the results or outcome were very difficult to manage; after all real life business problems are multi-dimensional with various stakeholders sticking in their oars at various time points. He soon realised that what appeared to be a neat concept had practical limitations for analytical purposes as it necessitated computerisation, facilitation and consistency amongst stakeholders – until he started further research into the method – which is where he repeatedly came across published references to a computer assisted version of MA by a certain Dr Tom Ritchey – who was, and still remains, the world’s leading authority on the subject.
Tom was a former research director at the Institute for Technology Foresight and Assessment at the Swedish National Defence Research Agency (FOI) in Stockholm, and had recently taken early retirement to transfer his military scenario and problem-structuring skills to the corporate world. He worked primarily with non-quantified decision support modelling in areas of genuine uncertainty such as crisis preparedness, risk mitigation, scenario development and strategy alternatives with numerous governments and corporate clients. Following the collapse of the Soviet Union, Tom had unearthed and extensively remodelled and computerised Professor Fritz Zwicky’s Morphological analytical methods; Zwicky developed basic MA in the 1930’s at Caltech to model uncertain cosmic phenomena such as dark matter and gravitational lensing but later applied it to new product development projects such as jet engine and radio telescopes design. Tom on the other hand was trying to model the uncertain threat scenarios posed by the various ‘Stans’ and their dispersed nuclear arsenal following the fragmentation of the Evil Empire in the early 90’s – a wicked problem indeed given the rise of jihadists, nationalists and ‘traders’.
In late 2008 Bruce started a dialogue with Tom to see whether the latter’s updated version of MA would help in structuring his SME research problem: “most certainly and more” came back the answer. So being of a generation who did not believe everything could be done in a virtual world, Bruce flew to Stockholm to see first hand, a full demonstration of this revised methodology. He soon realised that Tom was demonstrating a methodology which generically could be applied to a wide variety of complex problems which could not be quantified, and which resonated powerfully with Bruce’s earlier forecasting and social science background.
On returning to the UK and following a CEN committee meeting at Cass, Bruce mentioned to Nasir, (who he knew had recently completed an EMBA and was from a life science background), whether he had come across morphological analysis as a decision support method on his course and in his “day-job”. The pharma/life sciences sector was notorious in having to handle a wide range of highly complex and ambiguous problems with huge uncertain outcomes e.g. Vioxx, Thalidomide etc. Nasir said he had vaguely heard of the term but more in the context of anatomy, botany and zoology, where shaping preceded function. Nasir’s interest stemmed from his earlier work on developing the efficient risk-reward frontier of drug licensing portfolios, where up to sixteen parameters had to be simultaneously varied using the purely quantitative Monte Carlo technique. For this, Nasir had been awarded The Guild of International Bankers Lombard Prize in 2008 for his dissertation, porting over financial portfolio construction techniques to the pharmaceutical commercial development sector. Nasir’s own research led him to call up Bruce to say that he wished his thesis had incorporated the principles of MA prior to designing quantitative solutions for uncertain pharmaceutical drug futures, particularly as there was little data sharing on failed drug candidates by pharma companies. Like Bruce, Nasir rapidly become a convert to and an evangelist for, not only MA but for group-facilitated non-quantified decision support methodologies in general.
Nasir and Bruce soon came to the conclusion that the application of such a methodology was hardly known in the UK – neither in discussions with academics, major consultancy firms or corporate clients. Yet the timing for a re-introduction of such methodologies was right – after all, we had just experienced the advent of the greatest financial crash since the depression (which is still to play out). The pre-crash period had been characterised by an over-reliance in the last 30 years on short-term, overly formulaic and quantitative forecasting techniques, largely based on narrow bases of time series, compounded by subjective inferences by forecasters and their masters. Indeed FT columnist John Kay, in the wake of the 2008 autumn financial meltdown, had remarked that “In the 1980s, it seemed that computers held the key to economic forecasting. With large models and sufficient processing power, predictions would become more and more accurate.……we now understand that economies are complex, dynamic, non-linear systems in which small differences to initial conditions can make large differences to final outcomes.”
Excited by what they had discovered in Tom’s work, Nasir and Bruce invited Tom over to London in April 2009 where he delivered an eye-opening and stimulating presentation at Cass. The level of interest following the event was startling enough for all three to agree that a “consulting practice” needed to be set up. Strategy Foresight Partnership LLP (SFP) was born; it differed from traditional consulting practices in that SFP’s methods released the disparate, tacit individual and corporate knowledge buried within the firm’s DNA for a truly in-house, bespoke, and consensual solution space. Catharsis, deconstruction, and self-revelation is an inimitable quality for a truly competitive and sustained business advantage.
Yes, you may ask but why are these two alumni living in a “wicked world”– as per the title? Although SFP’s use of MA is one, albeit underused and under exposed, methodology it also operates in conjunction with other decision support methodologies such as Bayesian Networks, System Dynamics and the Analytic Hierarchy Process (AHP) to tackle “wicked problems.” If you work in an organisation that deals with long-term commercial organisational or social policy planning for new products, futures research or risk mitigation then you’ve got wicked problems. And while you may not call them by this name, you know what they are. These are complex, mutating, corporate, organisational or social planning problems that one hasn’t been able to treat with much success, mainly because no one has even been able to define and structure them properly. Wicked problems are messy, devious, and reactive, i.e. they fight back when you try to "resolve" them. Further they cannot be quantified, and have uncertain outcomes yet all your stakeholders expected them to be sorted - analysts, suppliers, financiers, and regulators and more importantly your clients.
In fact about the same time as the term “Wicked Problem” was being coined by Rittel and Webber at the University of Berkeley in 1973, another US academic, Russell Ackoff, came up with a similar concept a year later using the term “mess” or “social messes”. During the late 70’s to early 90’s these soft operational concepts resided largely in the domain of urban planning and other social sciences – there was no great urgency to move wicked and messy problems into the strategic management function or into any corporate organisation. Interestingly enough and completely independently an additional, rather odious acronym, but revered by media and advertising executives, was introduced in the 1990’s (again emanating from research in the military sector), which in effect covered the same area – this was VUCA, problems that were Volatile, Uncertain, Complex, and Ambiguous. Like so many concepts, each generation seems to re-invent ideas which had been developed in an earlier era. Not bad for a concept which was close to 40 years old.
There are signs though that a sea-change is occurring. In 2008 an HBR article entitled “Strategy as a Wicked Problem” was a welcome addition to the discussion. The author, John C Camillus stated that, “In today's complex world, companies often find themselves facing confounding strategy problems. These issues are not just tough or persistent; they're "wicked" - a label used by planners for problems that cannot be definitively resolved. ……A wicked problem has innumerable causes, morphs constantly, and has no correct answer. It can (only) be tamed, however, with the right approach.” He identifies five key criteria. If a problem involves many stakeholders with conflicting priorities; if its roots are tangled; if it changes with every attempt to address it; if you've never faced it before; and if there's no way to evaluate whether a remedy will work, chances are good that it's wicked. Banker’s bonuses, the West’s role in Afghanistan and how the landscape of Clean- and Nanotech world will look are typical of wicked problems. Perhaps all of these are symptoms of the Kondratiev winter we now face until the next disruptive innovation?
How do we manage wicked problems? Decision-support methodologies such as MA by themselves are not enough – there has to be facilitation by professional methodologists who bring about consensus, clarity and connections between cross-functional stakeholders. They must be subject matter specialists – in fact academics and traditional consultants can be part of the exercise but not facilitate it, in order to avoid bias. For example, when using MA, the facilitator conducts a Cross-consistency Analysis with the team to filter out up to 99% of inconsistent combinations in the combinatorial, parametric space.
SFP with its alumni founders connected across a number of decades, and with a Scandinavian consensual approach, has access to a legacy of over 120 “wicked” and “messy projects with major national and international public and private sector organisations”. Whilst working with generic decision support, SFP has identified a number of core clusters with whom it has decided to engage, including: life sciences/pharma where Nasir’s extensive knowledge of the sector has yielded strong client interest, the security, defence and risk mitigation area, leveraging Tom Ritchey’s experience of working with a wide range of public sector organisations, and from where it all began, funding and investment risk assessment at various stages of the business cycle, where Bruce has just completed a project with City University’s Research and Enterprise Unit. Other ‘wicked’ clusters being targeted include the financial services sector, CSR, and Cleantech. SFP also works with other specialist partners engaged in the security, governance and banking sectors.
An additional Cass connection has been developed – via an earlier CEN event with another alumnus, Alberto Lopez de Valenzuela, who has recently set up a management reputation consultancy – ALVA – with financial support from the Peter Cullum Centre for Entrepreneurship. Alberto is seeking to incorporate elements of SFP’s morphological analysis process into ALVA’s wider service offering for an organisation to understand where it stands in they eyes of its stakeholders. With foresight, the organisation knows where it can go…
SFP members do not claim to solve your wicked problems but they can work with the client to such problems. If you want to find out more about the innovative work that Bruce, Nasir and Tom are carrying out at the Strategy Foresight Partnership have a look at www.strategyforesight.org