The Complexity Trap

Tom Peters

Most August 12 newspapers carried two particularly troublesome
stories. One, about the hazards of oil tankers trying to traverse
the Persian Gulf, reported that our high-tech Navy was having
fits over Iranian speedboats. Our craft are too big, too slow and
too cumbersome to counter Iran’s commercial-variety speedboats,
with machine guns and recoilless rifles mounted on them.

The other article revealed that the deployment of the Soviet SS-
24 missile promised to significantly blunt our strategic
retaliatory capacity. It turns out that the missile is a simple
retooling of an old model, but this one is mounted on railroad
cars. Its ability to evade our strategic forces is based upon
93,000 miles of railroad tracks — not sophisticated electronics.

A third tale coincidently appeared at the same time, in Newsweek
magazine’s Special Report on NASA. Titled “Big Dumb Rockets,” it
chronicled our space program’s continued attachment to only the
most elaborate systems, and our repeated rejection of simpler
systems that might have driven down the cost of space transport
enough to allow rapid commercial and scientific exploration of
space.

We are rightfully proud of “big science” and the raft of Nobel
Prizes that go to Americans each year. Yet we are frequently
stymied by those who favor the practical over the possible —
e.g., the Russians in space and war-making capacity, the Japanese
in the marketplace.

The problems are many. For instance, the Congressional budget
process leads us to favor highly visible, major programs over
less sexy, routine improvements that don’t lure widespread
support. The defense-university-big-contractor combine is and has
been enamored with the bold leaps, not day-to-day improvements.
The activities of these bellwether organizations color our
approach to commercial markets also. We continually seek to “leap
frog” the Japanese, rather than pound away at constant, small
improvements that provide the host of “little features” that
please the ultimate end user (rather than the “design [science]
fraternity”). Furthermore, the Japanese exploit small niches
where they can try new technologies in mundane settings. Industry
Week recently reported, “U.S. firms have a tendency to shoot for
the best technology or massive markets while ignoring less glamorous
products for which there is a market demand.” The article quoted
Dr. Lee Rivers, director of corporate planning at Allied-Signal,
“You can’t get the CEO of a $5 billion (American] company excited
about a $100,000 market, like ceramic scissor blades or razor
blades. We shoot right from the start for the ceramic [auto]
engine. We don’t want to go through the learning process in
smaller markets.”

But the problem runs deeper still. In the late 1940s, General
Electric led the charge in developing overly complex automation
systems. Ironically, GE’s chief scientist, Dr. Roland Schmitt, is
now singing a different tune: “There’s … the issue of effective
execution — of strong performance all the way to the finish
line. Here research is not the answer. …[T]he vast
majority of today’s engineers need to be trained less like
researchers and more like the practicing, dirt-under-the-
fingernails engineers of yesteryear. By treating everything as a
research problem, we tend to devise elegant, inventive
solutions without adequate attention to cost, manufacturability
and quality. … [O]ur educational system imparts mostly academic
values, which emphasize optimum solutions, while putting little
emphasis on such considerations as speed, cost, and customer
satisfaction — the values of the marketplace.”

While our defense mire seems intractable, at least a few
enlightened organizations are succeeding in the commercial arena,
by taking a contrarian approach. Chaparral Steel of Midlothian,
Texas, is a pioneer in mini-mill technology. It has the lowest
costs among its U.S., and even its Asian, competitors. For
instance, it can produce steel at one-half what it costs the
typical Japanese mill. Founder Gordon Forward is a technologist
and a technology edge is the essence of Chaparral’s success. Yet
surprisingly, Forward brags that he has no research department.
He explains,, “Our largest challenge is to cut the time it takes
get technology out of the lab and into operations … so we’ve
tried to bring research right into the factory and make it a line
function. We make the people who are producing the steel
responsible for keeping their process on the leading edge of
technology worldwide … they go out and find the places where
people are doing interesting things. They visit other companies.
They work with universities. … The lab is the plant … we
don’t stop operations to try crazy things, but we do try to do
our research and development right on the factory floor. … If
you put a production fellow and a maintenance fellow and an
engineer together, you’re going to find out pretty quickly
whether something has a chance of getting off the ground.”

The impact of our love affair with complexity is monumental, runs deep
and threatens our international security and economic well being
alike. Dr. Schmitt of GE quotes a 19th century American civil engineer
by the name of Wellington, who defines engineering as “the ability to
do for $1 what any damn fool can do for $2.” Right now, American
engineers only seem to be able to do for $5 what the Soviets and
Japanese — and Iranians — can do for or a few pennies. The valuing
of hands-on, practical engineering is urgently called for, from
building missiles to ceramic scissor blades.