Jurisdictional Advantage assessment is a measure of the character of place. It is an important indicator that assesses the impact that local capabilities, supporting institutions, environmental elements and industrial ecosystems play in the success of industries and related investments.

Late in April, 2009 we developed an analytical framework to support ongoing assessment of Jurisdictional Advantage. Our client, Alberta Ingenuity Fund, and its stakeholder, Alberta Department of Advanced Education and Technology, are refining the tool to guide investment decisions within the research and development priorities of Alberta.

Measuring Jurisdictional Advantage

After reviewing and synthesizing 300 academic articles, our 50-page report includes a table of 75 indicators (lagging, current, and future) that together assess areas of Jurisdictional Advantage. Supporting this tool-set, we also created an index for measuring absorptive capacity – the ability of regions and industries to adopt and leverage new technologies. Capacity to bring in outside technologies and integrate new ideas in existing industries is a key indicator of potential for growth. Together Jurisdictional Advantage and strong absorptive capacity indicate potential areas of focus for new investment.

Jurisdictional Advantage for investment and corporate development

As investors consider future ventures and corporations evaluate strategic alternatives, Jurisdictional Advantage is an analytical decision-tool that provides historical, current and predictive information. As a framework it provides a robust and comparative set of choices that allow priority setting and ongoing analysis.

Our overview of Jurisdictional Advantage assessment, discusses key elements of this analytical tool and introduces the main concepts that underlie the framework. For further questions or for a copy of the full-report, please contact us by email.

(Update: If you’d rather you can download this article as a PDF)

The problems we face, in government and in companies, are getting more complex, more entangled, and more diversely influenced every day.

The information we bring to these issues is rarely matched to the challenge it is supposed to address. As Laurence J. Peter once said, “Some problems are so complex that you have to be highly intelligent and well informed just to be undecided about them.”

The times of single-CEO or single-company decisions are gone. To address the complex issues of today, we need something more social – more organic.

Never Enough

The Wickedness of Some Problems

Wicked problems include nearly all policy issues – not just ethically deplorable ones.

Horst Rittel and Melvin Webber, in a 1973 article for Policy Sciences , used “wicked” to describe the malignant, vicious, tricky (like a leprechaun), and aggressive problems of planning.

Problems of this kind, in government, include innovation-based investment policies R&D funding in public universities, and programs to drive regional economies. In corporations they are part of strategic plans on environment issues, developments that impact local communities, and investment options in areas under deep public scrutiny (i.e. Oilsands developments in Alberta, Canada).

Rittel and Webber argue that it’s “morally objectionable to treat a wicked problem as though it were a tame one, or to tame a wicked problem prematurely, or to refuse to recognize the inherent wickedness of social problems.” We can’t pretend our old analytical tools are sufficient anymore.

A new tool set

The work of Rittel and Webber started an area of analysis later picked up by consultant Jeffrey Conklin at Cognexus and professor John Camillus at the University of Pittsburgh. Rittel and Webber focus on public policy, Conklin bridges between public policy and corporate strategy, and the Camillus piece is distinctly corporate.

The view of Jeffrey Conklin

In his work, Conklin defines wicked problems as having four primary characteristics:

1. The problem isn’t understood until a solution is developed.

2. There are several people with something at stake in how the problem is resolved.

3. The constraints change over time.

4. The problem-solving process ends when the resources run out.

There is no definitive statement of a wicked problem. Each is an evolving set of interlocking issues and constraints. In most cases these issues and constraints are people-centric. This makes wicked problem solving a fundamentally social process.

As the political, commercial and temporal positions of stakeholders change so do the problem’s constraints. When constraints are ever-changing, there is no definitive solution.

With all the comings and goings of issues, barriers and interests – the problem is always changing and solutions always moving – the only way the process ends is when time, money, or energy run out.

Take our work at Conoco-Philips as an example. We were asked to help the company gauge its capacity and its options to respond to the environmental challenges that face the energy business.

Conoco-Philips is a massive company with business in a wide range of energy-related, vertical industries. Just identifying the opportunities related to environmental issues is a majestic task. But it takes the work of identification to finally comprehend the challenge.

Our work revealed an inter-connected, cross-functional set of relationships that spanned regions (In Canada – the Arctic, oilsands, and more populated areas in the south), businesses (oilsands, conventional oil, and natural gas), and business units (investment, R&D, planning, and development).

When our work started (early 2008) the price of oil was high and the environment was a key issue in the news. By its end (early 2009), the economy was all we talked about – even oil was plummeting.

We never did “solve” a problem. Our work just revealed a series of paths forward. It created a range of options.

If we had tried to analyze the issues on a quantitative or linear basis, we could not have succeeded. Instead we simply started mining – through discussions with the executive team, management teams and various individuals scattered around the company.

From the Camillus work

In his application to corporate strategy, Camillus focuses on three more characteristics (and leaves out the characteristic of indefinite solutions). The three he adds are:

1. The issue’s roots are complex and tangled.

2. The challenge has no precedent.

3. Nothing can indicate the right answer.

Because wicked problems can even arise from success (market saturation, public concerns around market dominance), it’s hard to know where they come from. With that lack of clarity, an attempt to address one issue can unravel answers to others. Often the resolution of one issue means addressing the resulting suite of issues it creates.

When the threat of unraveling everything is real it usually means developing entirely new strategies (versus incremental plans). The trouble starts when unprecedented strategy means wandering into new territory. Without familiar landmarks it is hard to know if new strategies are working.

Recently the Alberta Government has set out to renovate its innovation system. It’s meant distilling down the functions of nearly 30 innovation-related institutions into the mandate of just three. Part of our work with the department of Advanced Education and Technology involved creating a framework to identify key areas for these institutions to support.

One of the challenges is the numbing complexity of the task. Everything is there for a reason – usually a good one. Pulling one piece can mean destabilizing the rest.

The intention we have is not uncommon: target investments as deliberately as possible. But the decisions that support this capacity have yet to be made – standardizing data, building consensus on measures, and integration of processes. The work is without precedence.

Finally, no matter how good we are, there is always the uncertainty of being right, of missing some key element, of overlooking some very good but long-forgotten earlier decision.

Where it all began

Conklin and Camillus together cover just over half the ten characteristics listed by Rittel and Webber. The original list also included these:

1. Solutions are not true/false, but good/bad.

2. Every problem is the symptom of another problem.

3. Every solution is a one-shot deal.

4. The answer cannot be wrong.

Judgments on proposed answers are likely to differ as widely as the individuals in the crowd of stakeholders. Instead of seeking true or false, it’s a matter of satisficing. When the space of possible solutions is too large, you stop when the solution is “good enough”.

When the original problem is the symptom of a higher-level problem, there is a risk that the chain of causes rises indefinitely. A successful solution at a lower level can result in failures at higher levels. Every implemented solution is consequential. Every trial counts.

In spite of (and as a consequence of) the complexity and inter-woven nature of these issues – any implemented answer must be the right answer. The decision impacts lives. The effects matter a great deal to the people involved.

Early in our work in this area, we were involved in Canada’s response to the first outbreak of BSE or Mad Cow Disease. It was a bewildering time. How to respond to the industry while maintaining our obligations to international trading partners? How to save an industry in the short-term while keeping all the doors and windows needed for the future? There were no absolute answers – only gradients.

As we got into the economic analysis it became clear how deeply integrated every issue was to a host of others. Why were renderers shutting down? Because markets for tallow were closed to BSE-related products. But with renderers down we couldn’t deal with our sick animals or, even worse, the healthy ones. Animals were left in the field, losing value and chewing up margins. Everything was related.

But, ultimately, we had to decide. Livelihoods were at stake. The state of an industry was in jeopardy. It was do or die. And we only had one chance to get it right.

A host of examples

As the examples given surely reveal, this isn’t rare. Wicked problems are commonplace. That’s what makes this so important and so surprising – if common, why are wicked problem still so difficult to manage?

The Art of Wicked Management

Here’s the problem: taming wicked problems is easy.

One reason wicked problems are rarely resolved is that wicked problems are readily reengineered as tame ones. Rittel and Webber say tame problems are like benign tumors; wicked problems are malignant.

Benign problems have a clear structure, enable testable hypotheses, and can be analytically resolved. Cut them out, the problem ends.

Taming a wicked problem is like misdiagnosing a malignant tumor. Simply cutting them out makes them spread.

We can’t tackle wicked problems in the same way we handle benign issues. “To solve wicked problems, we need to confront a more complex mass of information than we are used to dealing with while unleashing creativity and opportunity-driven thinking.” (p.6)

Let chaos reign

Part of Conklin’s work involved studying how people solve problems.

He asked several designers to create an elevator control system. All were expert designers. None had experience in elevator systems.

Each was given a one-page description of the challenge. The designers were asked to think out loud, explaining their thinking process while they work. The sessions were videotaped and analyzed.

Conklin’s analysis showed that the designers tackled the problem in two ways. One was to identify the requirements for the system. The other was by running mental models of potential solutions and resulting consequences.

The experiment revealed something Conklin attributes to the nature of complex or wicked problems – conventional, orderly, and linear processes do not work.

In spite of conventional wisdom that complexity demands an ordered response – the Conklin work describes a chaotic, opportunity-driven process of design.
One designer might start with trying to understand the problem. Given a glimmer of understanding, they jump to a solution. Seeing a systemic failure, they return to formulating the problem. Another might start and end in a completely different way.

Conklin likened it to watching an earthquake. It appears chaotic on the surface, but “reveals deeper forces and flows that have their own order and pattern … It reveals that in normal problem-solving behavior we may seem to wander about, making only halting progress towards the solution. This non-linear process is not a defect, not a sign of stupidity or lack of training, but rather the mark of a natural learning process. It suggests that humans are oriented more toward learning (a process that leaves us changed) than toward problem solving (a process focused on changing our surroundings).”(p.6)

The traditional approach of gathering, processing, and analyzing data, formulating solutions, and implementing the result is an unnatural, mechanistic response to complex problems. Solving wicked problems means embracing a chaotic, opportunity-driven path.

Trouble is, how does this fit in the context of government and corporate strategy? The receptive capacity of these organizations is geared to a linear process.

It must be social

The work of Rittel and Webber, Conklin, and Camillus indicate that solving wicked problems is a fundamentally social process.

Horst Rittel is also the inventor of the Issue-Based Information System (IBIS). It helps decision-makers understand planning as a process of alternative position making. In the system, positions are associated with arguments for and against the position. When arguments raise new issues, these are treated in the same way.

The system is used to widen the coverage of a problem. It opens the process and encourages transparency. Observers and participants can trace back the decision-making process.

Of this social process Camillus writes, “It may seem trivial, but documenting assumptions, ideas, and concerns on an ongoing basis is important. It helps enterprises understand hidden assumptions and gauge the effectiveness of actions.” (p.3)

Conklin agrees. “Without a system to document or capture the full range of thinking and creativity that occurs in wicked-problem solving, people have to remember to keep in existence any idea that comes out of sequence.” (p.6)

The process opens the discussion to enable the breakthroughs, synergies, connections and alliances necessary for resolutions. It embraces the chaotic, opportunity-driven search for partial and early solutions. Conklin calls this rapid-prototyping.

Experiment early and often

Camillus also argues for experimentation. We should “abandon the convention of thinking through all options before choosing a single one and experiment with a number of strategies that are feasible even if unsure of the implications … conduct experiments, launch innovative pilot programs, test prototypes – make mistakes [you] can learn from.” (p.4)

He suggests that scenarios and scanning can help identify wicked problems before they are major issues.

In another Harvard Business Review article, this one by George S. Day and Paul J.H. Schoemaker, written in 2005, called Scanning the Periphery, the authors present a list of questions to help guide this enquiry.

Ask many questions, tell no lies

Day and Schoemaker have found that weak signals of emerging wicked problems can come from our past, present and future.

To learn from the past they ask:
– What are past blind spots? What is happening in those areas now?
– Is there an instructive analogy or case study from another industry?
– Who among the competition has picked up on and exploited weak signals? Who is acting ahead of everyone else?

To examine the present:
– What signals are being rationalized away?
– What does scenario planning or future mapping tell us about today’s signals?
– What are the mavericks or social outliers saying?
– What are peripheral customers and competitors doing?

To envision the future, ask:
– What could really hurt us?
– How would we attack our own business?
– What technologies could change the game?
– Is there an unthinkable future?

Day and Schoemaker argue that these questions force us out of natural habits. “Without conscious intervention, the mind will naturally force fit any faint inclinations into preexisting mental models.”

What to Do With Your Wicked Problem

Nothing is ever easy, but there are a few paths to move forward on wicked issues.

Schoemaker, the author cited above, is chairman of Decision Strategies International. Strategic Radar is a spin-off of this group and it sells software for managing some of the weak signal data just discussed.

Our partners in work related to these kinds of issues is Global Vision Consulting. A tool we use to address these sorts of issues is Outcome Mapping. It’s a process that allows us to record open discussions and layer in context and relationships as understanding evolves.

Finally, it was mentioned earlier that the information needed to address these issues is more complex and more massive then ever before. Fuld & Company, Decision Strategies International, and J.D. Power & Associates are well-established agencies in this space. New players include ManyWorlds and Hitwise. And there is, of course, ourselves.

If you’re curious about how wicked problems apply to your business, please give us a call or send us an email.

Turning guesses into decisions takes better information, stronger analysis, and tailored options. It creates higher impacts and returns responsibility to leaders.

When leaders embrace responsibility they reclaim the purposes for which they are paid. Through clear evidence, Sift Every Thing plays a strategic role but it leaves the decisions in the hands of those paid to make them.

Sift Every Thing helped the Alberta Centre for Livestock Genomics assess the economic potential of its strategic business plan to develop genetic markers that target specific livestock characteristics. They wanted to know what it might mean (economically) if the Centre achieved everything it set out to accomplish.

“A key part of moving a new idea and technology forward is helping stakeholders understand the value proposition,” said Brian Rhiness, Chief Development Officers of the Centre. “This work will assist that process.”

Given just three weeks to do the work, there was little room for model building and desk jockey analysis. Instead Sift Every Thing went straight to those that know best – animal producers, processors, and retailers. Ten industry experts were interviewed over the space of four days. The fodder for conversation was a synthesis of 21 international economic analyses conducted in similar jurisdictions.

As the results came together the information was fed back to the key team. “I very much appreciated the open and professional manner that Sift Every Thing used with the team,” said Rhiness. “Sift Every Thing worked with the team to understand our needs and help us flesh them out. The communication during the work phase was very useful in ensuring we were getting the information we needed and that we were connecting with the right stakeholders.”

End results suggest the Centre will have a significant and positive economic impact if pursued. Results from similar work conducted in Australia suggest a 30:1 benefit to cost ratio. Such paybacks are incredibly rare in agriculture, a business dominated by thin margins. Australia benefited most from a few early wins that drove up the result, but even a more conservative estimates such significant value.

Genomics technology has potential benefits in healthfulness, disease resistance, feed efficiency, manure and methane reduction, and heightened traceability. If it can achieve half of what it’s set out to do, it will be of great benefit to Canada.

The most obvious reason is that “expensive” is relative. We work on the most important and critical opportunities our clients pursue. Compared to the result we’re on the hook to provide, we are never expensive.

A more subtle reason is that high rates inspire accountability among the executives we work for. Accountability makes executives pay attention in wonderful ways. Motivated by wanting to make every cent count – they keep our work top of their list. And while the money is nice, we are really after that attention – sounds phoney, we know.

The complex, diverse, messy opportunities we get invited to work on need both our expertise and the insights and experience of our clients. Attention, it seems, is the rarest of resources. So, given a critical component of our work is bringing attention to the right places, the rates are a key element of success.

Bottomline: In the last eight years of doing this work we disappointed just two clients – the only two where we started with discounted rates.

Clear evidence for decision makers. That’s our focus. Welcome to Sift Every Thing, the next generation in management consulting and advice. We specialize in tailor-made strategies and handcrafted frameworks built to suit your decision-making needs. Turn chaos into control the Sift way.

We sift. You succeed.

Our unwavering dedication to thoroughness when synthesizing information creates clarity. And the end result is clear evidence that decision makers like you can use to make informed choices. A decision without clear evidence is only a guess.

Let’s get sifting.

Utilize clear evidence to make important decisions. Call or e-mail our senior economist, Jeremy Heigh, today at +1-780-669-3607, jeremy[at]sifteverything[dot]com

We want to create tailored, nuanced, and clear evidence for our clients. We want to choose clients for the next 10 years, not the next three months. We want to create sustainable communities of business – where things are more clean, more fine, and of greater worth because we were there. We want to stay small, on purpose, and bring hand-picked capabilities to deliberately chosen business opportunities.

So, is this different? It probably doesn’t really matter if it is. But this is how we want to work.

The Ontario Ministry of Research and Innovation hired Sift Every Thing to facilitate a meeting of key stakeholders to identify, and create consensus on, goals and strategies for a neutral and not-for-profit International Composite Centre that leverages Ontario’s strengths in its global markets.

“The involvement of Jeremy Heigh in our research proposal planning activities was invaluable,” said Dr. Peter Frise, Executive Director of Automotive Research and Studies, University of Windsor and CEO of Auto 21. “Jeremy was able to draw out the real needs and perspectives of each of the parties in the consortium and bring them to the fore so that people could exchange views in an effective manner.”

Peter McCormack, North America Sales Manager for Dieffenbacher Group and champion of the consortium commented on the sessions saying, “Sift Every Thing moderated a strong group of industrialists, members of government and academia. The planning demonstrated a good sense of forethought and allowed for all parties to have an active voice within the fast-paced session.”

In the end close to ten industrial partners and government agencies agreed to move forward with the concept. If realized, the proposed Centre could provide a much needed injection of new market potential and hopefully inspire a seemingly rudderless North American auto industry.

We think he captured perfectly the essence of the thing we love to do.