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Monday, December 12, 2011


11:10 PM Posted by Deepak Nayal , No comments
As human beings it is in our nature to be uncomfortable with ambiguity and uncertainty. The degree of discomfort and the actions we take to overcome that discomfort vary for each person. Almost all of the actions we take in this case pretty much have to do with structuring - this includes measuring stuff, research, creating models and detailed planning. Human beings, in general, would like to be in control, and putting structure around things helps us be in that state. Doing so obviously has its merits, but I think it becomes a problem when you try to put structure around everything, plan everything, try to put your hands around everything. 

Structure has its merits, but so has chaos. Unfortunately, in the professional world, chaos is considered to be a taboo. Consultants and managers swear by structure. Market reports, research, detailed analysis documents, project planning. Companies try to make sure that everything is analyzed and articulated. We succumb to our natural tendency of putting structure around everything. But the fact is that real world is a lot more unstructured, fluid and ambiguous. While our tendency for planning and structure only leads us into believing that things are under control, it does not actually change things the way they are. And this difference between perception and reality leads to failure of projects and initiatives - bigger the difference, more the chances of failure. I believe that we need to embrace reality and the things that come along with it, chaos, uncertainty, ambiguity, and be prepared to unstructure. 

This disconnect between reality and human desire to be able to put fingers on something concrete has led to failures in many areas. In finance, analysts love DCF (discounted cash flow) and ratio analyses. These are two of the primary mechanisms to value companies. However, in spite of these "powerful" tools, companies still fail in M&As, investments and IPOs. In software engineering, people have tried to estimate development effort, analyze requirements and plan projects to the nth degree for a long time. But software development projects still get delayed, get over-budget and end up with a different kind of end product than asked for. In marketing, companies spend huge amounts of money on market research and still end up with failed products. 

Don't get me wrong. I am not against a directed way of working or structure or models or plans. I agree that these are important. I am against the idea that not having a structure or a plan is bad, that just trying out things is not the right way to go about. Every initiative depends on multiple factors. You can control some of these factors but not others. I am absolutely up for planning to the nth degree as long as all the factors in that initiative are in your control. If that is not the case, acknowledge that you are not in control of everything, do plan but plan in the way that it allows for things to change or fail. This is why I like frameworks, milestones and checklists more than detailed project plans, because you will rarely work on an initiative in which all factors are in your control. 

The stuff I am talking about here is definitely not new. The professional and academic world has been realizing that the real world is much more chaotic than we recognize, and has added elements of flexibility and human elements to many fields. For example, even in a hard subject such as finance, people understand that it is not as much affected by numbers and formulae, as it is by human nature and feelings (such as trust and fear). This realization has led to the growth of behavioral finance. In software, practitioners have realized that traditional waterfall model and estimation methodologies are not very effective. This has led to agile software development methodologies, such as Scrum. In marketing, experts have realized that market research and focus groups do not necessarily provide the correct picture. This has led to use of techniques and subjects such as observational studies and anthropology in the field of marketing. 

Method, structure and direction - these are definitely required for executing projects and initiatives. When combined with a healthy dose of trial-and-error, chaos and experimentation these can do wonders in getting things done. I believe that we need to realize that it is not required that we always have a detailed plan, even in the professional world. That direction, complimented by trail-and-error, can actually prove to be much more beneficial than either of these individually. That sometimes you need to unstructure, in order to do things in the right way.


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