The Challenge of Rising Complexity in a VUCA World

I can’t help but be fascinated by history and currently read Joseph Tainter’s book The Collapse of Complex Societies (1988), where he describes complexity as the key to understanding the collapse of civilizations. In parallel I’m exploring the extensive work of Arnold J. Toynbee, an English historian and the author of A Study of History (1934-1961), based on an analysis of the cyclical development and decline of civilizations. With a brain functioning as a “pattern detection machine” (as to Dr Julia DiGangi, neuropsychologist), I’m also seeing interesting parallels in the work of Joseph Schumpeter on his theory of Creative Destruction, in Adiezes work on Organizational Lifecycles, and Wheatley and Frieze’s work at Berkana Institute and their Two Loops Model, and other theories of change and renewal.

I find these fields of research of particular interest today, as the 21st century is often described as a VUCA world—volatile, uncertain, complex, and ambiguous. Global interdependence, technological advancements, climate change, geopolitical shifts, and economic instability all contribute to an intricate web of challenges that demand ever more sophisticated and complex responses.

A growing body of thought now refers to our era as a meta-crisis—a crisis of crises, where multiple interconnected systemic failures (environmental, economic, political, social, and technological) converge, creating a compounded existential challenge. This perspective highlights that our civilisation is not merely facing an isolated crisis but deeper structural problems.

Let’s start by exploring Tainter’s thoughts.

The Collapse of Complex Societies

Tainter’s book provides interesting insights into why civilisations fall. Contrary to popular theories that blame environmental destruction, leadership failures, or external threats, Tainter argues that societies collapse primarily due to diminishing returns on complexity. His work offers an interesting perspective on the state of our modern world, where problem-solving through increased complexity isn’t always sustainable.

Tainter defines collapse as a rapid loss of social, political, and economic complexity, leading to a more simplified form of organisation. He critiques conventional explanations for collapse, such as resource depletion, external invasions, or moral decline, arguing that these factors alone do not explain why societies fail.

Instead, he introduces the principle of diminishing returns on complexity. In his view, societies develop complexity to solve problems, leading to bureaucratic institutions, technological advancements, and increased specialisation. Initially, this leads to significant benefits—better security, food production, infrastructure, and governance. Over time, however, additional layers of complexity become increasingly costly and bring fewer benefits. As societies struggle to maintain their structures, they extract more resources from their people, leading to economic stress, social unrest, and vulnerability to external shocks. Eventually, a tipping point is reached where maintaining complexity is no longer viable, and collapse becomes an adaptive response.

Tainter illustrates his theory with historical examples, including:

• The Roman Empire, where military expansion, heavy taxation, and administrative burdens ultimately outstripped the empire’s ability to sustain itself.
• The Maya civilization, which experienced agricultural intensification, political centralization, and inter-elite competition, leading to an unsustainable system that collapsed.
• The Western Roman Empire, which relied on taxation and conquest to sustain its bureaucracy and military but crumbled when it could no longer support its complex structure.

Tainter’s key insight is that collapse is not necessarily a failure, but an economic rationality—a society’s way of adapting to unsustainable complexity by shedding its costly structures and reverting to simpler forms.

Here, a video where he explains some of his findings.

A Study of History

Unlike Tainter, Arnold J. Toynbee saw renewal as an option. In his Study of History, Toynbee argued that civilisations do not necessarily collapse but can instead be reinvigorated by a creative minority—visionary individuals and groups who introduce new solutions, paradigms, and cultural transformations. He analyzed the rise and fall of 26 civilizations, identifying patterns of challenge and response as key determinants of their survival or decline.

According to Toynbee, civilizations flourish when they successfully respond to existential challenges with creative adaptations. However, when societies become rigid, complacent, or dominated by a dominant minority—elites who resist change and focus on maintaining their own power—decline becomes more likely. In contrast, the creative minority can drive renewal by offering new visions and organizing principles that re-energize society.

Toynbee also introduced the concept of withdrawal and return, where individuals or groups retreat from the dominant system to experiment with new ways of thinking and living. If successful, these experiments can later re-enter society as transformative forces.

Ultimately, Toynbee saw decline as a choice, not an inevitability—suggesting that civilizations that embrace change and foster creative leadership can find new paths forward rather than succumbing to collapse.

Berkana’s Two Loops Model: A Pathway to Transformation

The Berkana Institute’s Two Loops Model offers another compelling framework for understanding how change happens in societies and organizations. It illustrates how old systems decline while new ones emerge, providing a structured approach to transformation.

According to this model, every system follows a lifecycle, growing in complexity before eventually reaching its limits. As the dominant system begins to decline, a group of pioneers and early adopters start to explore and develop alternative ways of thinking, organizing, and leading. These change-makers operate within the margins, experimenting with new structures, values, and approaches. Over time, if these alternative models gain traction, they create a parallel system that can eventually replace the old one.

The model identifies key roles in this process:

• Pioneers – Those who see the need for change early and begin developing new ideas, practices, and structures.
• Networks of Support – Individuals and groups who connect pioneers, share resources, and amplify new solutions.
• Hospice Workers – Those who help manage the decline of the old system with dignity and awareness.
• Bridges – People who translate between the old and the new, helping to carry forward valuable aspects of past wisdom while integrating emerging paradigms.

The Two Loop Model seems to be aligned with Toynbee’s concept of the creative minority, where renewal is driven by visionaries who step outside existing structures to imagine and cultivate new possibilities. It also connects to the meta-crisis perspective, suggesting that our era of systemic breakdown is not simply a moment of collapse but a pivotal opportunity to build regenerative, resilient systems.

In the context of modern civilization, the Two Loops Model offers hope: rather than waiting for total collapse, we can actively participate in the emergence of a new, healthier paradigm. By identifying and supporting the pioneers of the future, societies can shift from unsustainable complexity toward a more adaptive and flourishing future.

Organizational Lifecycles

Just as civilisations go through cycles of rise, peak, and decline, life itself follows similar patterns. Whether we observe biological organisms, ecosystems, or human life, we find recurring themes of growth, stability, entropy, and renewal. In essence, collapse and death are not the end. Rather, it is a necessary transition for societal and organizational renewal. Understanding these patterns can help us navigate change, both at the personal level and within society, embracing evolution and the circle of life itself.

Just as civilisations and life itself follow patterns of rise and fall, so, it seems, do organisations. Adiezes’ Corporate Lifecycle Model describes how organisations evolve through distinct phases:

• Birth and Early Growth – Entrepreneurs and start-ups introduce new ideas and innovations, experiencing rapid expansion.
• Prime – The organisation reaches its peak, balancing efficiency with agility.
• Bureaucratization and Decline – As the company grows, layers of bureaucracy increase, leading to rigidity, reduced adaptability, and eventual stagnation.
• Aging and Fall – If renewal does not occur, organisations become overly bureaucratic, risk-averse, and inefficient, ultimately leading to decline.

Adiezes points out that organisations have a renewal option.

Through entrepreneurial thinking, decentralised decision-making, and continuous innovation, organisations can avoid stagnation and reinvent themselves. Companies like Apple, IBM, and Microsoft have demonstrated this ability by embracing change, restructuring, and staying adaptable in evolving markets. The key to long-term organisational health is balancing structure with innovation—maintaining efficiency without becoming overly complex and rigid.

Schumpeter’s Creative Destruction

This leads me to the concept of creative destruction. It briefly describes a similar process by which old business models, technologies, or products are replaced by new and more efficient ones. According to Joseph Schumpeter, whose focus was the industrial revolutions, creative destruction is an inevitable part of economic growth and innovation.

An example of creative destruction is the rise of the steam engine and how it replaced older forms of energy and labour – today translated into how renewable energy is replacing coal, oil, and gas. Or how digital photography emerged and replaced analogue photography (think Kodak). These can most probably be described as radical innovations, as they transformed entire industries and created new market leaders.

Creative Destruction can even be said to be the underlying dynamics of many of today’s big corporations, like Amazon, Apple, Airbnb, Uber, and Netflix. They all started small and gradually challenged the incumbents of their respective industries.

The entrepreneur is the star in Schumpeter’s theory: an economic actor who, through creativity and innovation, shakes up markets and creates change. The entrepreneur introduces new combinations of ideas that lead to innovation and overturns the existing order by introducing new technologies, products, or services, thus making current offerings obsolete.

In short, the idea behind creative destruction is that creativity and innovation are the driving forces behind economic development. Simply put, innovation creates new markets and opportunities while destroying old structures. Companies that don’t adapt become irrelevant and, therefore, risk going under while new companies emerge. In this way, economies and societies are renewed over time.

Creative Renewal

Still exploring these fields of thought, the thought that comes to me right now is that we instead of resisting change and renewal have the option to go with the flow of life and evolution. This was also something that I reflected in my first book, Navigera in i framtiden (2018).

Life on this planet simply seems to invite us to follow a path of continuous and creative renewal, while structures and even culture help preserve some sort of stability, but ultimately follow the same pattern. This brings great hope, as it suggests that the ongoing meta-crisis and increasing complexity are not only obstacles but also opportunities.

Innovation and renewal seem to arise when a creative minority—visionary individuals and groups—step forward to introduce new solutions, paradigms, and cultural transformations. These pioneers act as bridges to the future, helping to shape the next stage of societal evolution.

This interpretation can help us reframe our challenges, not as signals of inevitable collapse, but as invitations to renewal. The question before us is whether we will resist change and cling to outdated complexity or embrace transformation, simplifying and restructuring in ways that allow for regeneration. As the meta-crisis unfolds, it is this ability to adapt and innovate that will most probably determine whether we navigate toward collapse or co-create a more resilient, flourishing future.

When viewed through the meta-crisis perspective, this moment in history represents both a profound risk and an opportunity. It may push our civilisation toward a tipping point. However, as with previous societal shifts, the key question is whether we will collapse under the weight of complexity or use this moment to reinvent and regenerate our systems.

I suspect that Creative Renewal may be the answer we are looking for.

Why? Because creativity is one of humanity’s most valuable assets.

Read more about Creative Renewal here >>

Elisabet Lagerstedt

Elisabet Lagerstedt is the founder and director of Future Navigators. As a trusted advisor, consultant, and Executive Coach, she helps business leaders navigate beyond business as usual to build Better Business and co-create a better future - through insight, strategy, innovation, and transformation. Elisabet is also the author of Better Business, Better Future (2022) and Navigera in i Framtiden (2018).