Complex Systems: a process for change

In the ‘60s, I began to understand that politics was something that could affect my life as I grew up.

I watched Walter Cronkite report nightly on domestic and international political affairs and heard WDEV-Radio Vermont report on the Vermont Legislature’s deliberations on whether such and such a town should continue to be a “dry town” or might vote to become a “wet town” and sell alcohol, or whether daylight savings time still served farmers and schools, or whether a governor should serve for two years or four years, or whether Vermont should allow pari-mutuel betting. Supporters argued that allowing bets on the trotters at agricultural fairs benefited the fairs and the State. Opponents argued that betting would attract organized crime and promote gambling.

Later in the decade, we banned billboards but upheld Blue Laws prohibiting sales of alcohol and goods deemed non-essential on Sundays, the basis of which was religious.

Those issues and others like them were often binary and thus comprehensible to most of us. Perhaps our best recent example is Vermont’s right-to dry-law that makes it illegal to ban someone from putting up a clothesline.

Our executive, legislative, and judicial branches were largely reactive to comprehensible problems as they rose to confront us. We listened, discussed, chose sides, and made changes. But alas, that is yesteryear.

Driven by relentless progress in science, technology, and information delivery, the challenges we face now are complex systems that have evolved and accelerated in complexity over the intervening decades. They can’t be addressed by the citizen-legislature law-making we’ve revered for two centuries. In fact, reacting to and trying to amend the spin-off problems that emanate from complex systems often makes the situation worse.

What are Vermont’s most evident complex systems?

• public education and funding: access, quality, and expense
• public safety and criminal justice
• our environment that sustains human, animal, and plant life
• economic stability, business regulation, and tax systems
• regenerative agriculture: the source of a safe and secure food supply
• broadband ubquity: information access, distance-education, journalism, telecommuting, telemedecine, and social networks
• energy: generation, transmission, and consumption
• population health: cost, access, and quality
• housing: cost, location, and availability

Over my 77 years, I’ve spoken to many business leaders, legislators, and governors about issues facing Vermonters. For the most part they’re bright, committed men and women who understand service and leadership and are committed to advancing the lives of Vermonters. But they, too, are daunted by the increasingly opaque nature of the complex issues we face, each of which has developed its own language and technology systems. I’ve spoken to legislators who’ve said, off the record, that in committee people tend to agree with the last cogent person they heard testify on a problem. I’ve had the same experience, struggling to place information in the larger context.

Another daunting element of complex systems is that they’re all interwoven. Education, housing, food security, and population health are all integral to criminal justice. Agriculture affects and is affected by energy, the food supply, population health, economic stability, and the environment, and so on.

And Vermont is but one small star in a federal galaxy. Federal policy, statute, and regulation all limit how Vermont can address and solve its challenges, and our economic security is interwoven with that of the nation and, increasingly, the world.

Healthcare is a good example. Our efforts to make healthcare affordable and accessible to all Vermonters are complicated by the national understanding that healthcare is a competitive business rather than a defined right, as it is in most other countries. Vermont is powerless over Medicare, Medicaid, national insurers, or Pharma and is left to innovate in reaction to existing national policy as Governor Shumlin discovered.

One of the single largest expenses for businesses is healthcare and very few business leaders outside the healthcare business itself understand what drives its costs. In 2005, Toyota chose to locate its new multi-billion dollar plant just north of the border in spite of generous U.S. economic incentives because Canada had a national healthcare system and Toyota could avoid that major operating expense.

Debated for decades with no action is the ongoing question of how can a one-year budget cycle, a two-year executive and citizen legislature with inadequate support systems begin to address the complexity of the issues we face?

Governor Scott, who has proven himself to be a solid crisis manager, is going to run again and Vermonters will probably reward him for his past leadership. But will he rise to lead the effort to resolve Vermont’s daunting complex challenges?

At the end of the current biennium, we’re losing a significant portion of the Legislature’s institutional memory and leadership. There is value in change. It adds new blood and refreshes the pool of ideas, and we must nurture new leadership in all aspects of governance. But ideally leadership transitions are incremental rather than tidal.

Over the years, the Legislature has convened a number of citizen commissions to study, address, and advise them on complex systems. I’ve served on three of them: Blue Ribbon Tax Commission, Vermont Farm-to-Plate, and a one-off study group on executive compensation (convened by the Snelling Center) in the three branches of government. With the exception of  Farm-to-Plate, none, sadly, had much follow-on impact on the system it addressed.

What I’ve come to understand about these systems is that success requires four functional elements:

• a clear mission, driven by shared values and supported by ironclad policies
• good governance (an independent board of trustees)
• independent stakeholder oversight with defined regulatory authority
• accountability as defined by agreed-upon performance metrics

Each must be clearly articulated and independent of one another. Any one is not enough and there can be no overlap.

Furthermore, we must provide adequate research and knowledge resources for each to deliberate and function properly. This will include internal and external stakeholders and may include finite contracted consulting resources.

It’s also critical to understand and differentiate the motives and intent of internal and external stakeholders if one is to overcome the inertia that inhibits change. In the case of healthcare, it would include patients, providers, payers, and professionals, each with their own agenda.

Internal stakeholders may fear the loss of current privilege and not be able to imagine the opportunities created by change. External stakeholders are often the unwilling victims of problems in complex systems and will advocate for change that relates to their issue. In my experience, community stakeholders will generally seek common ground in the goals of change and try to mesh their mission with that of the complex system under study.

By way of example, a community stakeholder working on housing and homelessness might advocate for re-envisioning the vacating state college campuses as new communities of learning and converting empty dorms into energy-efficient, affordable housing to meet the needs of our aging population, as homes for new Vermonters or for Vermonters leaving the criminal justice system, for example.

This is where leadership is vital. The Governor and legislative leaders must stay the course and advocate for a vision of the future that addresses the challenges and opportunities for all stakeholders  ̶  a key element in healthcare and education especially.

If we’re to reimagine and re-engineer our complex systems, we will need to do the same for the processes that lead to change. We must elect and support innovators in all branches of government and, of critical importance, provide our legislative and commissioned bodies with the research, analysis, and data to generate effective change.

As we wrestle with the problems of today and devise solutions, it’s also vital that we have metrics to gauge our success or failure. I was asked recently if there was a simple metric that we could use to assess the effectiveness of our efforts.

My answer:  “Count the number of people in our emergency rooms, homeless shelters, and prisons. That will give you an idea of how well we are managing our complex systems.”