by Ahmed Humayun
We are overwhelmed by choices and decisions in our integrated, interdependent, information-rich world. We often find it difficult to identify what is important, to solve or even ameliorate pressing problems. We may live in a time of unsurpassed abundance – at least, in the advanced, industrialized regions of the world – but we are unequipped to deal with the implications of unprecedented choice. Thanks to the Internet and social media, vast rivers of information course through laptops and tablets and smartphones, constantly threatening to drown us. In this type of world, how should we – as individuals, professionals, and nations – focus on the relevant information, attack the right problems, generate creative alternatives, and make effective decisions?
In Simple Rules: How to Thrive in a Complex World, Donald Sull, a senior lecturer at MIT, and Kathleen Eisenhardt, a professor at Stanford's School of Engineering, locate the answer in ‘simple rules'. Their starting point is the work of Warren Weaver, an early 20th century leader in the science of complexity who categorized the stages of scientific eras as a progression through simple, uncertain, and complex problems. ‘Simple' problems can be addressed through powerful formulas that relate a few variables, such as force = mass x acceleration, while in ‘uncertain' problems, probability and statistics are used to predict the average behavior of large numbers of things.
This leaves untouched the third and final class of problem – the ‘complex' problem, which dominates the era in which we now live. As Sull and Eisenhardt write: ‘Scientists can predict the path of two billiard balls with precision, and the average behavior of two million gas particles. But what about the messy middle ground, where twenty or thirty components interact with one another in unexpected ways?' It is this middle ground, the terrain of the complex problem, that simple rules can help navigate. Instead of throwing complex solutions at complex problems, the best response is simplicity.
What are ‘simple rules'? You sort of know them when you see them, though Sull and Eisenhardt identify the general principles that appear to apply across many of these cases. Successful simple rules are few in number, customized to a particular context, applied to a well defined activity or decision, and offer just the right mix between guidance and discretion. When it comes to collective behavior, simple rules are easier to remember and implement, especially when we are not at our best. We are most in need of rules to optimize effort when we are weak, not when we are strong.
Sull and Eisenhardt carve up the universe of rules into decisions and processes. Decision rules structure choices, and include boundary rules (what should you choose when confronted by multiple alternatives?), prioritization rules (how should you sort and rank options?), and stopping rules (when should you stop doing something?). Process rules include how-to-rules, such as coordination rules (how should you guide interactions among members of a system?) and timing rules (when should you take action?
Sull and Eisenhardt argue by example, distilling a vast number of intriguing facts, case studies, and anecdotes from a wide range of industries and disciplines that illustrate the characteristics of effective simple rules. They identify the operation of simple rules in butterfly mating strategies, product strategies in the robotics industry, strategies to deal with insomnia, effective dietary decisions, improving online dating hit rates, bail decisions in the U.S. judicial system, the success of comedian Tina Fey, and the design of commuter-rail networks in Tokyo.
In one example of a boundary rule, Sull and Eisenhardt show that burglars disregard a wide range of potential considerations in choosing to target a house, such as the presence of a security system or tough locks. Instead, they focus on shying away from homes with cars parked outside, ‘the single most reliable predictor of occupancy.' In another example that demonstrates a prioritization rule, they point out that ancient Romans had to contend with a vast, conflicting legal code that had accreted over hundreds of years of empire. But in 426 AD, rules on the use of historical judicial opinions were specified. The first rule confined citations of past precedent to the five most eminent jurists in Roman history, with four follow on rules about what to do if those judges agreed, disagreed, were split, and so on.
Sull and Eisenhardt then trace out how effective simple rules can be developed and when these rules should be broken. They maintain that these rules have as much applicability to individual problems as to group problems, to business strategy as much as to self improvement. Indeed, one can easily see the utility in using the principles of simple rules to structure a wide range of problems.
Simple rules work because they aren't as simple as they seem. It takes a considerable amount of effort to develop simple rules inductively, based on experimentation, adaptation, and learning from the experiences of others. The success of simple rules derives from deeper reasons not immediately apparent, such as their capacity to compress insight and capture correlated information. (For example, a simple rule used by an American entrepreneur to plan his international market expansion strategy is to pick English speaking markets. It turns out this rule is ‘actually a proxy for several other variables that were related to successful growth'). And simple rules often outperform complicated models, which work well when there is a lot of data and the underlying causal relationships are understood, but are less effective when these conditions are lacking.
Sull and Einhardt have written a fascinating, thought provoking book. In one sense, their notion of simple rules is just another one way of reemphasizing the importance of effective problem structuring, whether it comes to the making of decisions or the erection of processes to execute tasks. In order to be even minimally efficient, we all rely on such heuristics, consciously or otherwise, in navigating our complex world. Their contribution is to take what is often implicit and make it explicit, by defining the characteristics of simple rules and identifying a range of brainstorming procedures that can help us derive and implement them.
While Sull and Einhardt cover an enormous amount of territory in discussing the applications of simple rules, one key area of human life is conspicuous for its relative absence: politics and government. At the outset, they argue that the unique importance of simple rules derives from their effectiveness at solving complex, unprecedented global problems – they refer to the 2008 financial crisis, climate change, the transformation of huge sectors of the economy such as health care, and the integration of the European Union. In one sense, few things resemble a complex system more than the structure, incentives, and operations of large entities like the U.S. government and its interlocking relationships with a global network of governments and organizations. Indeed, the complex problems Sull and Einhardt rightfully warn us about, are all ones in which governments, individually and collectively, will have to play a role, perhaps the most important role.
Yet, they rarely cite instances of successful, simple rules in this domain. One exception is a reference to the U.S. Defense Department's research and development arm, the Defense Advanced Research Projects Agency (DARPA). It invests in scientific research using the simple rules of enhancing ‘fundamental scientific understanding' that also has ‘a practical use' and boasts a remarkable track record of innovation, despite relatively limited funding and staff.
Otherwise, when governments make an appearance in the text, they are typically offered up as an example of what not to do. Take the labyrinthine US tax code. Despite its extraordinary length (Sull and Eisenhardt would say, because of it), and an army of tax professionals whose sole function is to decipher its provisions, the tax code invariably generates inconsistent and arbitrary tax outcomes.
It may be that government policies are less likely to furnish examples of simple rules because government institutions are simply inherently more inefficient and less geared towards optimization than industry or science. Maybe governments desperately need simple rules but are not set up to generate and implement them.
Or, perhaps, there is a more fundamental ambiguity about how simple rules apply in government and politics. Perhaps decisions concerning the public or national interest are fundamentally different than those concerning the private interest. Perhaps simple rules are much harder to generate when there are fundamentally conflicting notions of ultimate value. We know that the purpose of business is profit, but what is the purpose of government? It depends on who you speak to, and it depends on your vision of society.
In the United States, if you are a liberal, you might say the purpose of government is the preservation and expansion of a welfare state; if you are a conservative, the defense of liberty; and if you are a libertarian, non-interference in the exercise of liberty. Of course, each of these statements would be deeply contested among the different factions within each of these groups as well. And then consider expanding our view to the rest of the world, the cacophony of different cultures, societies, and governments, articulating their own distinct, fractured visions of the world. It may be that simple rules presuppose shared values. Perhaps, some problems are far too complex for simple rules.