communications as the synthesis of three selections; information (a selection ... knowledge to produce them3. ...... Autonomous Units) in NatWest Bank-UK.
Systems and the Information Society: Requisite Organisations and Problem Solving Raúl Espejo University of Lincoln, UK October 2002 “Nature uses the limiting resource as regulator, and we – institutionally- do not, because we erroneously think that the limiting resource is cash…. The regulator is the limiting resource.” (Stafford Beer) “Civilization advances by extending the number of important operations which we can perform without thinking about them.” (Alfred North Whitehead)
Foreword This paper offers my personal construction of the communications and interactions that happened in the context of the Systems and Information Society Network (SISN), from November 2000 to October 2002. Details of the network’s operation are included in its Final Report. As for the paper’s content, its shortcomings are all of my exclusive responsibility, however, I cannot claim credit for whatever insights it might offer; they are the outcome of co-operation with all SISN members in a shared communication space.
Summary Meanings emerge from our interactions reflecting the quality of the tacit organisations underpinning their creation and production. These organisations are by and large the outcome of self-organisation, suggesting that meanings emerge beyond our control, something that often is inadequate. However I take the view that there is room for their design and offer epistemological and methodological clarifications for this purpose. To start with, I explore the idea of problem situations and relate them to the gap between the pace of social and ecological events and our individual and collective capacities to deal with them. This gap puts pressure on us to communicate and as we do so we contribute to producing social systems and organisations. In this discussion effective organisations are seen as media for competent communications among stakeholders sharing a policy issue. Communications require crossing the boundaries of autonomous individuals and organisations and for this collectives need to develop communicative competencies. In the end I hypothesise that the design of requisite organisations for particular policy issues is a catalyst for self-organisation to produce desirable social meanings and it is argued that this design can be enabled by ICTs.
Keywords: social system, organisation, identity, structure, communications, requisite organisation, communicative competence, orthogonal communications, modelling and anticipation, recursion of meanings, design, ICTs
1. Introduction Our social and organisational activities all too often produce both unintended consequences and performance problems. Different forms of the tragedy of the commons and implementation failures are experienced by all of us in an increasingly connected world. In sensitive areas of political, economic and social concern, institutions are constantly stretched to improve their performance. Politicians and managers are constantly looking for new insights and tools. As Homer-Dixon says in his book The Ingenuity Gap: “The ingenuity gap… is a way of thinking about the very real chasm that sometimes looms between our ever more difficult problems and our lagging ability to solve them.” (HomerDixon, 2001, page 2)
It is in response to this sort of challenge that systems thinking may have something to offer today, particularly when many of contemporary performance issues appear to emerge from our increased connectivity at all levels. It can be argued that these performance shortcomings are the outcome of us not seeing systems when producing policies and implementing new tasks. It would appear that we lack adequate thinking tools and practical methods in order to appreciate connectivity and complexity in human activities. In particular there is a great need to understand their systemicity. In this paper I explore the idea of organisational systems. From biology and ecology we have learned about the systemicity of natural systems (Capra 1996). The concept of autopoiesis, as developed by biologists Humberto Maturana and Francisco Varela (1987), is making a significant contribution to our understanding of autonomy and co-evolution of systems in their environment. Luhmann (1995) extended these ideas to society, but his concern was not offering methods and tools to bridge the ingenuity gap. The idea of autopoiesis, by emphasising cognition as pertaining to the whole body rather than just to the mind, is transforming our systemic appreciation of knowledge creation and development processes. It is becoming apparent that these appreciative processes cannot be just the concern of a few people but of all those producing an organisation. Knowledge creation and management requires that we account for the views, experiences and learning of everyone involved in producing an organisation’s processes and tasks, and not just for the experiences and learning of those responsible for their overview. This latter view has been responsible for a good deal of social fragmentation. Accounting for the complexity of all participants in an organisation implies a paradigmatic shift in its management and structure. An issue addressed by this paper is clarifying the extent to which these ideas, in the context of current developments in the information society, give insights about how to overcome this fragmentation. In management science, Stafford Beer has made a significant contribution to this accounting. His methodological work, in particular what he called the Yo-yo Methodology (S. Beer Decision and Control, Wiley 1966) has made it possible to relate work in biology, particularly in neuro-physiology, to work in management and organisations. The Viable System Model (VSM) is a product of this methodology (Beer, 1981). This is a recursive model of the organisational structure of any viable system. As such it uses insights of the management of complexity in natural systems to account for the complexity of regulatory processes in organisations. These are powerful insights about requirements for systemicity regardless of whether we are talking about natural or social systems, but the systemicity of the latter is much less clear than that of natural systems. The purposeful character of people makes it
difficult to see institutions as systems, yet they produce global meanings suggesting that they are social rather than individual phenomena. It can be argued that these emergent meanings are the outcome of people sharing communication spaces. In these spaces individuals, under certain conditions of connectivity, may become meaning producing organisations.
The VSM helps us to understand how people’s interactions produce shared communication spaces with particular structures, and at the same time, how available communication spaces influence the constitution of their interactions. For instance, shared communication spaces populated by people with uneven power are likely to produce hierarchical structures, which themselves become the media to constitute interactions with uneven distributions of power. This is a social mechanism that leaves most of the influence in producing organisational meanings in the hands of a few. The development of our social institutions is thus restricted by the declarative power of these few. This uneven distribution of power may be responsible for restricting people’s creativity and therefore for making the invention of insightful solutions to our problems less likely. However, it can be argued that historically this uneven distribution has been more the outcome of our inability to see systems, and thus achieve systemicity, than of social conspiracies. A hypothesis of this paper is that the information society, through ICTs, can increase significantly society’s problem solving capacity by harnessing social connectivity and enabling effective selforganising processes. I want to deal with the following issues in this paper: •
What does it mean systemicity in society? What is a social system? When can we consider that a collective is an organisational system?
•
What are relations of production/performance between an organisation and its environment? What are performance problems?
•
What are relations of cohesion within an organisation? And what are relations of belonging of this organisation in its wider contexts?
•
Why is self-organisation key to problem solving? How can self-organisation be enabled? What is the scope for organisational design?
•
What can we say about methodologies for problem solving and organisational design?
•
What is the scope of ICTs in producing knowledge and desirable systemicity in society?
•
How is the current information society changing the nature of shared communication spaces, in particular how is it enabling their virtuality? What is the scope for this virtuality? How is this virtuality changing the use of information technology in organisations and society?
2. Social systems, Organisations and Institutions Problem situations are ubiquitous. They are inherent to the complexity of the world, to the pace of events and to our changing expectations. To deal with them we find it necessary to interact and communicate with others. Whatever emerges from these interactions and communications is by and large the outcome of self-organising
processes, which if stable, imply successful strategies to cope with environmental complexity. Our own biological organisation, that is, our organism, is an instance of a successful evolutionary strategy to make sense of environmental complexity. However, we are all too aware that this systemicity in the human domain is not easy. Individuals’ purposeful behaviour, defection from collaboration, conflicting values, unilateral use of power and so forth are but a few characteristics of the fragmented nature of our social behaviour. Considering all this, does it make sense to assume the systemicity of institutions and other social bodies? The answer is not easy, but in the end I argue that yes, it makes sense and moreover that this epistemology gives us new lights about dealing with communication issues, in particular, with the multiple forms of many-to-one and one-to-many modes of communication that are fundamental to social organisations and democratic societies (Mingers, 2002). What does it mean systemicity in society? Are societies systems? Is there a difference between a social and an organisational system? Are institutions and other formal social bodies organisational systems? The purpose of this section is to clarify the epistemological status of systems and in particular how they contribute to conceptualise societies and institutions. The concept of a system is that of a distinction we make as observers in a background or environmental context, which separates an inside from an outside through a boundary. Making the distinction highlights a unit from its background. But, is a system a concept that we construe in our minds as an epistemological device to support our reflections about the world or is it an object of research that exhibits features justifying the use of the concept of system? If the latter, how is it instantiated empirically. Which are these features that justify the use of the system concept? Is it a constructed object or a self-constructed object, emerging from self-organisation? (de Zeeuw, 1997) I will give answers to these questions throughout this paper; in this section I will only offer a general introduction to the ideas of social and organisational systems.
2.1 Social Systems and Organisations Recurrent interactions of a collective’s members may form an organisation. Recurrent interactions produce relations, which if conserved over time constitute relationships independent of particular individuals, thus producing some kind of identity for the collective; an organisational system is emerging. However, our experience is, more often than not, of fragmentation. This experience I suggest has its roots in the fact that we operate simultaneously in an informational domain and in an operational domain (Espejo, 1994). Oversimplifying, in the information domain we, as purposeful individuals, construe meanings, in the operational domain we produce them by means of our moment-to-moment interactions. Fragmentation emerges from lack of coherence between these two domains. This is the case when we produce1 meanings, as individuals, groups or cliques, unaligned with those we espouse collectively. People in institutions and social bodies of all kinds sense this lack of coherence when their espoused purposes are out of line with the meanings they project through their products and services.
1
In this work, producing meanings is equivalent to producing meaningful products and services.
As said above there are all kinds of reasons for this fragmentation; poor interactions, lack of appreciation of the consequences of our actions, hazy values and abuse of power are but a few of the factors underpinning social fragmentation. However much these features are true expressions of our nature, I argue later, that it makes sense to hypothesise the systemicity of institutions and collectives, and test empirically the extent to which they run short of the properties of an organisational system. But, how are social and organisational systems related? A social system is a meaning that emerges from people’s communications in an action domain, which shows observational closure2. In this framework the components of a social system are communications. Luhmann (1995) defines communications as the synthesis of three selections; information (a selection from a repertoire of referential possibilities), utterance (a selection from a repertoire of intentional acts) and understanding (the observation of the distinction between utterance and information). It is the development and observation of these repertoires, emerging from previous communications and not from communications acts, that produces the social system. It is the potentials for more communications, to deal with uncertainty, which constitutes them as components of a particular social system. A social system is a kind of dynamic social capital in constant evolution, produced over time by multiple collectives, and maintained by their complexity differentials with their relevant environments. They are responsible for society’s functional differentiation. On the other hand, an organisational system is a network of people in interaction creating, regulating and producing their own meanings. Closure in this case is given by the collective’s responsibility for creating and producing its own meanings. When this is achieved for explicitly created meanings the collective’s interactions embody learned, and hopefully transferable, knowledge to produce them3. The components of the organisation are the roles of the people producing (through their communications) the organisation that constitutes them as components. They are responsible for society’s structural deepening (Espejo, 2000). The communications of some groups within an institution, whose interactions may contribute to produce organisational cohesion and closure, contribute at the same time to produce meanings beyond their institutional boundaries; they support society’s functional differentiation. For instance a group doing a company’s financial and management accountancy, at the same time of contributing to its cohesion by enabling the company’s production of its own products, is contributing to the production of the financial system in society. The financial system is produced by accountancy communications in society, produced by individuals but independent of them once
2
For instance the ‘educational system’ is a social system that emerges from the large variety of educational communications, all of which are contained by the meaning we have socially constructed for education. 3 The relevance of explicitly created meanings, rather than implicitly created meanings, in this statement is that the collective have succeeded in steering their self-organising processes in a desirable direction (for them) of which they are aware.
produced, which are triggered by other accountancy communications, thus defining an autopoietic system, which produces itself (Luhmann, 1995). The hypothesis used here is that social systems emerge from communications as people get involved in meaning creation and production processes. As people interact with each other they produce shared linguistic codes. As these codes become independent of particular individuals, communications become encoded social information that produces particular social systems (e.g. the legal, education, scientific, and so forth, social systems). However, the structural deepening of these codes is responsible for further functional differentiation and social complexification. Social systems provide evolving mechanisms of codification that define societal complexity, beyond the particularities of individual organisations4. This complexity is made available to institutions through functionally differentiated social systems, at the same time that these institutions communications constitute these social systems. Communication acts (as opposed to communications) imply people’s coordination of actions. Indeed, observing this coordination is the way for us to know that communication among them is happening. People operationally coupled by social systems are likely to require less channel capacity to coordinate their actions than those who are not operationally coupled (Leydesdorf 2002a &b, Conant 1979, Espejo et al 1996). Communicative actions may produce relations among participants if they become recurrent interactions. The forms of these interactions thus become independent of particular individuals and constitute relationships, which encode that that they maintain. Encoded relationships give them communicative advantages. People, and the resources they use, are their embodiment. This embodiment is an organisation. The view taken here is that there is systemicity in society when we can observe communications that produce themselves in a loop of circular causality. For instance in the scientific community we can observe that scientific publications (a form of communication) trigger more scientific publications in a continuous loop of circular causality. These observations suggest that science is a social system. There is also systemicity in society when we observe collectives making and implementing their own decisions and as a result creating, regulating and producing their own norms and meanings. This is the case of organisational systems, where we can observe that roles are constituted independent of the people involved, who can be any as long as their interactions produce the organisation that constitutes them as roles. Organisations -the institutions and other resources that produce them- can be seen as mechanisms bridging the communication differentials between the systems producing society’s functional differentiation. This is an important consideration; social systems are disembodied at one level and embodied at another. They are the outcome of communications, not of communication acts (interactions), and as such they are disembodied. On the other hand organisations are embodied systems, which together 4
However, as I will clarify later in this paper, organisations provide the social arena for the intersection of multiple meanings. For instance, the intersection of the political, technological and economic social systems in multiple organisations is supporting the creation of new legal codes, say for knowledge protection, and therefore the functional differentiation of the legal social system.
with their multiple regulatory systems, produce indirectly society’s social systems. This distinction suggests that one of the features of organisations is that individuals’ structural couplings produce them, while the equivalent feature of social systems is the operational coupling of people through them (Leydesdorf 2002 a&b)5.
2.2 About boundaries What are the boundaries of a social system? A social system is self-organising and self-producing. In scientific terms it is the case of a self-constructed research object. In that sense its boundaries are self-produced by the communications that produce it. In societal terms it is important to avoid the unchecked development of self-producing systems. This is an ethical concern in the development of society, for which social regulation is necessary. What are the boundaries of an organisation? Institutions often are not organisations, with capabilities for meaning creation and production (Espejo 2001). On the whole this is far more the case of ‘other-constructed’ scientific objects (de Zeeuw, 1997). The creation of institutions often forces upon its members processes of self-organisation within the framework of external regulations and norms. Often these institutions lack regulatory capacity to support humane processes of self-organisation, imposing the values and priorities of the few with power over the rest. It is within these restrictions that decisions are made and some closure given to the institution. Its lack of regulatory capacity will be recognised by poor interactions both within and with agents outside its boundaries. In the process the balancing of internal demands of cohesion and external demands of performance and belonging defines these very boundaries. Empirically, we may find all kinds of variations regarding the matching of organisation and institutions. We may hypothesise an organisational system and find that it encompasses several institutions (Espejo, 2001) and even then closure, capacity to create and produce their own meaningful products, may not exist suggesting that they are not an instance of an organisational system. On the other hand, several organisations may emerge in one institution. An observation of relations among members of the related collectives may also make apparent that desirable relations of belonging and cohesion have not been constituted, suggesting that expected systemicity is not in place. Therefore social institutions often lack systemicity. Organisations, on the other hand, with all their structural limitations, are systems bridging communication gaps between the meanings we create and the environmental complexity in which we operate to produce them. Organisation becomes a key communication strategy to cope with problem situations; requisite organisations are necessary to produce desirable outcomes, products and meanings. Organisations evolve as a result of individual and collective self-referential learning processes. It is only with reference to what they are, whether explicitly or implicitly, that this learning becomes possible. But how do the problems we experience in daily life relate to these organisations? This is the concern of the next section. 5
Structural coupling emerges from people’s recurrent interactions in particular communication contexts or social systems; on the other hand operational coupling is dominated by communication contexts rather than by interactions.
3. Problem solving as the construction of an Organisation Driven by the need to satisfy our expectations we experience imbalances between environmental complexity and our action/response capacity. These imbalances trigger the need for ingenious responses (Homer-Dixon, 2001). At a macro level our social expectations have been engines to improve our quality of life, however our actions in order to achieve them have produced all kinds of social and environmental imbalances, which constantly require new and more ingenious responses. Imbalances between the requirements implied by our expectations and our response capacity are commonly experienced as problems for collectives and individuals. In the extremes global issues like terrorism and local issues like everyday pressures of life tax equally our ingenuity. However, in this paper we will focus problem solving on policy issues of social concern. For these social issues, when faced to imbalances we either find more ingenious responses or alter our expectations. If our expectations are reduced too far, our social viability may be threatened. But even if we show ingenuity and also communicative competence, the structural and cultural contexts of our actions may render them irrelevant.
3.1 Bridging the Ingenuity Gap Bridging the ingenuity gap is a driver for learning and social construction. As discussed above, in societies the rule seems to be fragmentation rather than systemicity, however key to our ingenuity is producing institutional transformations to achieve connectivity where there is none, to achieve more with less (e.g. more services and products with fewer resources), to achieve inclusion where there is exclusion, and so forth. Producing social systemicity can be seen as a major response to the ingenuity gap. Indeed not only the web of life shows us that the world is fundamentally systemic (Capra, 1996), but also our own social activities, one way or the other, are constantly weaving complex webs of social connectivity. These experiences of connectivity suggest that our institutional responses need to be systemic as well; “Every regulator of a system must be a good model of that system” (Conant-Ashby, 1970). But far from producing an alignment between collective expectations and situational outcomes, our actions often make apparent selfishness and fragmented behaviours. However, we may expect that collaboration and collective responses are far more likely to bridge effectively the ingenuity gap than selfishness. Systemicity is a necessity for problem solving and viability beyond survival, and in this section we start the journey towards a framework to develop this systemicity. How do we deal with problematic social issues? My purpose is to explain the interplay between ingenuity, insight, creativity and the structural and cultural constraints limiting them. Not everything is possible, however much more than we usually imagine is possible. Awareness of what is possible and impossible helps to develop resources and to direct efforts for structural changes in order to remove constraints. It is useful establishing at the outset ‘negative explanations’, that is, clarifications of what is not probable or even possible, in order to avoid unrealistic proposals or wishful thinking (Bateson, 1973 page 375). At the same time this clarification allows us to visualise structural changes in order to make more likely
what we think is desirable. Indeed dealing with the ingenuity gap is not only a problem of creating more ideas for solving technical and social problems, additionally, it is a problem of constructing enabling contexts to make possible the so far improvable or impossible. There is interplay between the need to learn in particular action domains and the contexts for this learning. Individual and organisational learning take place in social contexts that we construct through our interactions. The relationships emerging from these interactions are fundamental to define our spaces of possibilities. For instance we can expect very different spaces of possibilities if belonging is understood and constructed as a relationship of dependence rather than of autonomy. Similar considerations apply to relationships of constitution of an organisation and of performance of an organisation in its environment. Awareness and understanding of how contextual backgrounds are constructed provide us with leverage for creativity and action. They offer the cultural and structural backgrounds for the on-going construction and deconstruction of our individual and collective realities. Our individual and organisational learning are bootstrapped in these contexts, something that suggests the critical role of self-reference and modelling. Understanding our relationships of constitution, belonging and performance is necessary to have an appreciation of our organisational contexts. Awareness of these relationships is part of a process of identity construction, which often makes apparent that individuals, let alone collectives, are divided selves. Relationships of belonging6, cohesion and performance produce an organisation’s identity. Relationships of cohesion may transform a collective of individuals into an organisation and relationships of performance may make this organisation viable in its environment. The structural embodiments of these relationships make apparent that we, as individuals in collectives, are entwined in organisational and performance processes, or as I have explored in a previous paper in relations of constitution and production (Espejo 2002). The bridges between relationships and relations are structures that bootstrap identity to purpose, that is meaning production to meaning creation, or as explored elsewhere, bootstrap the operational domain to the informational domain (Espejo, 1994). Our goals and purposes only make sense within particular bodies, which bootstrap their creation, which in their turn bootstrap the development of these bodies. For individuals this is a natural process, defined by our systemicity, in which we adjust our goals, and the meanings we ascribe to them, to the bodies we have. Indeed self-awareness facilitates these adjustments. All this is part of a learning process, triggered by judgements of our capabilities and potentials. Creating these potentials and developing an awareness of them open the space for creating and producing unexpected meanings and removing constraints. For collectives the social policies they are accountable for suggest they need to develop requisite organisations or bodies in order glide in particular, perhaps turbulent, environments. For collectives learning is also necessary and indeed possible provided that they develop the systemicity of an organisation, that is, provided they develop cohesion and become aware of themselves in their contextual embeddings. It can be argued that dealing with a policy issue to overcome a perceived societal problem does not necessarily require of an organisational system. For instance, 6
Which sometimes I have referred as relationships of citizenship (cf. Espejo 1999)
problems arising from breaks of relations of constitution may require an institution rather than an organisation, to bridge the ingenuity gap. For a country, new and more powerful auditing and legal institutions may be necessary to overcome problems of corruption, and we know that these institutions should not be organisations (Espejo 2001). Is this not a case, therefore, of an institutional rather than organisational solution to the ingenuity gap? The problem is that creating these institutions without a clear understanding of their connectivity with other institutions and resources in society may produce dysfunctional solutions, which takes us back into the idea of requisite organisations.
3.2 The Systemicity of an Organisation Perhaps a fundamental aspect of problem solving is developing an awareness of the support networks enabling our intended actions. Because of its natural connectivity a desirable support network for a particular policy issue is its requisite organisation. Unfortunately, this systemicity may not exist and even if it existed, it may not be visible to the collective. Awareness of people’s roles and the relations that constitute them is not always easily accessible. It requires them to observe producing an organisation that they may not be aware of. Naturally people recognise their institutional contexts, and often that helps particularly to those operating at the corporate level, which control the levers of power. But, if the collective does not produce an organisational system focused on the policy issue at hand, the chances are that people will need to cut across several, weakly related, institutions to get the required support, something that may increase the difficulties in problem solving. Also, if the collective does not provide an organisational context to deal with the policy issue their chances of removing contextual constraints will be small. Of course, people’s intuition may help to develop these networks, also already established networks may help (e.g. ‘old boys network’ in the British civil service), otherwise using blind trial and error may not be good enough for learning. People develop relations one way or the other as an outcome of their multiple interactions. Whether these relations are coherent with their purposes, and those of the collectives they belong to, is another matter. As they build these relations selforganisation is in progress and unless individuals and their collective, as a potential organisation, develop awareness of the interplay between the identities they are producing and their espoused purposes and meanings, the chances are that both, identity and purposes, will be the outcome of uncontrolled forces that produce much pain to those constituting the organisation and much misuse of collective resources. In practice the purposes and meanings that they produce are likely to be very different to those they espouse. Both individuals and collectives find themselves at the mercy of forces beyond their control. In the extremes, relations evolve either bottom-up as people search for support networks for their interests or top-down as institutions enforce their decisions on employees. In this latter case relations reflect the interests of the people in power, something that restrict the use of the collective’s resources. Recurrent interactions produce embodied relationships or relations. Indeed, people produce these relations, supported by all kinds of resources, most notably in contemporary societies by information and communication technologies. The
organisations emerging from them are the outcome of self- organising processes and often we are not aware of which are these organisations; for us it is easier to recognise simply the manifest institutional contexts of our actions. However this is not good enough. It makes problem solving more costly in social terms and reduces the chances of removing contextual constraints and creating new possibilities. Most people find themselves fighting against private or public faceless bureaucracies, something that may reduce completely the transparency of their participation in collectives. Each individual is in a one-to-many communication -one against the corporate bureaucracythat controls most of the levers of power. Organisations, and their related processes of constitution and performance, become instruments of exploitation and alienation in the hands of the few who control both the interaction languages and the allocation of resources (e.g. resource allocation models based on traditional accountancy, lacking in complexity to recognise the situation of the individual). These are organisations that produce social exclusion and injustice. All is pointing in the direction of helping people become more aware of the social structures they contribute to create through their interactions. This should be, and moreover ought to be, feasible even for the most humble participant in a collective. People need to become effective observers of both, the social contexts they produce through their interactions and the roles they are constituted into by these contexts. It is only then that they can become masters of their own destinies. It is only then that they can relate their informational and operational domains and fight for the adjustment of the tacit parameters that restrict their actions. Indeed these observational capabilities are also necessary to create possibilities and to construct desirable realities. ‘Seeing organisational systems’ and adjusting and constructing desirable ones are competencies at the core of problem solving. Without these abilities, shifting the ground of our interactions becomes insurmountable. What is apparent is that the same problems I’ve described for individuals and their collectives in relations to particular policy issues also apply to the collectives themselves in their relations of belonging within multiple other collectives, responsible for wider policy issues. What interactions are responsible for the relations they develop? When are these relations ‘enabling’ rather than destructive and limiting? Are stakeholders aware about the evolving relations they are producing? How can stakeholders increase their awareness of these relations? What does it mean this awareness for the members of each collective? In summary, three main relations dominate our problem solving efforts; these are the relations of constitution of an organisation, relations of production vis-à-vis environmental agents demanding and receiving our products and services and relations of belonging with those representing the larger collectives we select, or have to accept, as contexts for our actions.
4. Stretching: Collective-Environment Relations The focus of this section is on the interactions between those in the collective, which have been hypothesised as forming an organisational system, and the wide variety of agents in their environment. This is a learning loop in which the collective clarify their expectations, create meanings and act accordingly. Clarifying expectations means self-reference and self-awareness. Who are we? What do we need to do? Where do we want to be in the future? These are self-referential questions at the core
of expectations. The collective construct a model of the organisation they are producing as their members interact with environmental agents. Their evolving meanings and related models emerge from their internal debates and decisions as they interact with people and institutions (i.e. agents) in their environment. It is through these interactions that they construct their relevant environment. It is particularly relevant to understand this process of environment construction. It is at the core of the organisation’s performance. Assuming that the collective has reached the state of an operating organisation, it is apparent that it is already producing meaningful products of one kind or another for agents in its environment. This is the organisation’s operational environment in which it is achieving some outcomes. Though we may expect problems in these production processes, our concern here is not operational, routine, problems but the perception of a large mismatch of complexity between the organisation and its environment, which suggests the need for more ingenuity. The collective is recognising a problematic environment, which requires further construction of the organisation’s environment. We will now discuss the key mechanism to relate the organisation’s informational and operational domains. This is a fundamental issue of self-reference to allow the collective developing the requisite organisation to glide effectively in their selfselected environment (Espejo and Zarama, 2000). Here I explain the mechanism for this gliding. There is a process of mutual influence in which self-reference, expectations and identity allow members of the collective to focus on and become sensitive to, particular environmental challenges, whether in the form of threats or opportunities, which in their turn stretch the collective’s expectations and identity, triggering the need for organisational development. This is a process in which members of the collective create possibilities through their interactions with environmental agents. For more effective organisational performance it is the responsibility of the collective to make their environmental agents more challenging, more ingenious, more demanding. Without this stretching the collective may have an easy ride in the short run but bumpiness and perhaps extinction in the longer run. Stretching is necessarily to develop a strong body to cope with turbulent environments. If we use the concept of variety, or number of possible states of a situation (Ashby, 1964), to illustrate this stretching, the collective should see that its own variety vc triggers the agents’ construction of a much larger variety VAD, in their shared action domain (see figure 1). This variety, much larger than theirs and relevant to their expectations, is generated by interactions mapping their self-referential appreciation of their identity. VAD is the variety that the collective needs to cope with to manage their expectations. The process by which the organisation attenuates this very large variety defines its performance in managing its expectations. We are now referring to VAD being reduced to vc’. The mismatch between the varieties of these two sides in interaction defines the ingenuity gap. A collective that fails to create environmental variety and to manage it through interactions in the environment itself, is a collective at the mercy of their surroundings; there is no environmental capacity (agents) fencing disturbances for them, there is no (adequate) tension to strengthen them as an organisation. On the other hand an effective management of expectations implies enabling a large capacity to manage possibilities in the environment itself and the ability to withstand strong tension leading to more capacity to manage variety with relatively less resources, that is, to a stronger organisation. From the point of view of the management of
complexity, I suggest, this is the mechanism to trigger new organisational forms. This is a mechanism of circular causality, where identity and self-reference trigger the need for interactions that produce new possibilities (environmental variety) that produce new organisational responses in order to cope with this extra variety that produce the need for self-reference, that may trigger in a recursive process new organisational forms and related identities. These are learning loops. The ingenuity gap is managed both by strategies to increase/amplify our response/action capacity, which entails increasing environmental variety as explained above, and by strategies to decrease/attenuate the environmental variety. These strategies are like the two sides of the same coin. One without the other fails to manage our expectations effectively. Amplifiers and attenuators are complexity operators that support designing institutional responses to the demands of our environments. In relative terms, for a particular level of performance, it is in the collective’s interest to find ingenious means to increase the complexity of their environment and to decrease their own complexity. Paraphrasing the above argument, I’m saying that in one form or another agents in the environment are all affected by the collective’s actions, and they should be prepared to challenge them. The more these agents challenge the collective, the more this system will need to improve its decision making processes and the more it will need to develop an effective organisation to cope with them. An undemanding environment does not stretch the system, which then may not see the need to improve its decision processes. Stretching is a responsibility of the collective and implies increasing the appreciation of agents about the issues of concern (i.e. policy issues) as well as providing them with channels of communication to make effective their challenge (this is expressed in figure 1 below by the transformation of vc into VAD in the environment, which is a measure of the variety of agents and their concerns challenging the system). This increased appreciation and channel capacity implies that the system has to deal with more environmental complexity than otherwise would be the case, often beyond its existing response capacity. Coping with this increased complexity triggers the need for a better organisation of the system, which implies overcoming both fragmentation of its structure and inadequacy of its communication channels with its environment. A measure of this organisation is the vc’ that allows it to deal effectively with the environment’s large VAD. This stretching mechanism implies actively triggering the involvement of competent resources in the environment, making their own distinctions relevant to the purpose of the communication, and second, a robust organisation able to create and produce responses.
Ingenuity Gap: Collective’s responses to demands in Action Domain Amplification*
I
D Learning cycle
Action domain
VAD
*institutional responses:
VC’
VAD
O
VC
Collective
A Attenuation*
VC* is the stable institutional response as an outcome of a recursive process
O: observe A: assess D: design I : implement
Figure 1
5. Scope for Organisational Design 5.1 Structures at the Edge of Chaos The webs of ecological and social interactions within which our activities take place pose huge challenges to the stability of our collectives, whether families, small teams, enterprises or global institutions (Capra, 1996, Homer-Dixon, 2001). Our response to these challenges cannot just be piece-meal local responses; they need to be effective structural responses (e.g. new institutional responses). The Conant-Ashby theorem suggests that these responses to be effective need to be good models of the challenges that these webs represent for them. It is apparent that these are webs of distributed complexity that require distributed, but interconnected, responses. We need institutional responses that release individual creativity and action capacity to tackle global problematic situations. Distribution allows people to use their capabilities and also to develop their potentials, increasing the chances for imaginative responses. Connectivity is necessary not only to avoid uncoordinated local responses but also to achieve the huge muscle of synergistic global responses. This is an area in which, as I will illustrate later in this paper, ICTs are already playing an important role and can play an even larger one in the future (cf. BBC reporting of response to the Andrax threat in the USA after the 11/9, in section ICTs and Organisational Systems in this paper). Connectivity within and among institutions focused on the policy issue of concern is desirable and necessary. However, how do we know what is a good level of connectivity? What are the limits for the ‘making connections’ principle? (MitletonKelly & Subhan, 2002). Not making requisite connections (for whatever purpose) among participants, and between them and environmental agents, reduces the
complexity of the situation and makes less likely self-organisation, making too many connections increases the complexity of the situation, perhaps beyond manageable limits. It seems necessary to have methodological help to find the edge of chaos for a collective (Mitchell Waldrop 1993). Empirically, we may expect that stable organisations emerge from people’s interactions when they are at the edge of chaos. Indeed, assuming interaction at the individual micro-level, under which conditions can we assume that structure and organisational form will emerge at the macro-level? This raises fundamental questions about organisational forms and the scope for organisational design as a catalyst of self-organising processes. Self-organising processes absorb the extraordinary complexity of human interactions and are responsible for the construction of social systems and organisations, which emerge from our collective response to the chaos we operate within. We produce social systems as we make sense of the world by making linguistic distinctions that codify information and intentions in never-ending processes of social differentiation and functional complexification. They are cultural expressions of societies’ growth and development. On the other hand, we produce organisations as we create, regulate and produce meaningful products and services recursively, in on-going processes of structural complexification. Moreover, problem solving is a social concern that requires support networks and I have argued that this implies enabling structures. We need to understand the principles underpinning the development of this kind of structures. Here I explore the scope for designing organisation structures to respond to the stretching of the environment. The challenge is speeding up learning processes of the affected people so that they produce the structures necessary to visualise potentials and realise capabilities. While interactions are not enough to produce organisation, recurrent interactions will produce structures of one kind or another. Our concern is diagnosing their quality for the creation, adaptation and implementation of necessary problem solving strategies or policies. Offering these diagnostic criteria, as a platform for design, is one of the contributions of the Viable System Model (Beer, 1979) that is briefly explained below in this next section. This is a model of the structures emerging from successful interactive strategies to cope with environmental variety. From this model we learn about structural recursion and organisational processes. We learn that structural complexity unfolds as the stretching of the organisation’s largely self-produced and bootstrapped environment grows, producing organisations within organisations recursively. We learn that organisational processes underpin structural mechanisms that evolve to maintain cohesion and support adaptation and change over time. The Law of Requisite Variety (Ashby, 1964) gives us capacity to diagnose the quality of relational situations, in particular of those responsible for cohesion, performance and belonging. That much we have known for some time, the challenge now is transforming this understanding into knowledge in the social domain. Much empirical research is necessary to produce this kind of knowledge. Much knowledge is necessary to conclude inductively where is the edge of chaos for particular situations and how to transform a particular collective in an instance of an organisation (as a research object), with capacity to create, regulate and produce its own meanings. Until high quality observations permit us to contain the social variety of multiple collectives within an organisational system, we can only hypothesise emergent organisations in particular institutional set ups.
A collective can be understood as people acting together in pursue of shared interests, however in this pursuit they do not necessarily become a closed network of interpersonal relations producing a whole, that is, an organisation. In a diagnostic mode, for a particular policy issue and related institutional resources, we can hypothesise an organisation, with organisations embedded at several structural levels within it and draw diagnostic and design conclusions from there. I will explore this point from the perspective of a collective’s problem solving and draw methodological conclusions to improve their responses to environmental stretching. As discussed above the response to this stretching entails processes of meaning creation, which often imply the need to trigger environmental variety in order to strengthen the organisation’ capacity to produce these meanings through products and services. This is a learning loop that implies making observations, assessing them, designing responses and implementing these designs. This is the OADI learning loop (Figure 1) in the action domains defined by the meanings that the collective is creating and producing. However, this learning entails simultaneously two learning loops. One is the meaning creation and production loop, through which members of the collective articulate their expectations and concerns, whether as problems or opportunities, and produce some responses (i.e. implementation). The other is the processual or organisational loop that contextually bootstraps this meaning creation and production. The organisationl loop relates to organisational processes providing whatever structural capacity is enabling or restricting the learning loop. Processual learning is perhaps a crucial requirement to release potentials by removing unnecessary restrictions on the collective. These two loops underpin individual and collective learning in one way or another. The challenge is to make them fit to purpose, that is, effective. Indeed meaning creation and production are the outcome of conversations for possibilities and for action (Flores 1982), and as such, ideally, they should be unrestricted. However they do take place in cultural and structural contexts of one kind or another, which constrain them to different degrees.
5.2 Designing Requisite Organisation It is important to appreciate the notion of organisation in use. The basic assumption is that behind any particular meaning (i.e. policy issue), that is created and produced there is a responsible organisational system. Most of the time this is a tacit organisation, which defines the tacit support networks that make things happen, but more significantly, defines the support networks that could be used, but are not being used, to create and produce desirable meanings. Ignoring them is responsible for unnecessary costs or missed learning opportunities. However if meaningful products and services are produced, requisite connectivity eventually has taken place, even if that has been achieved at a high cost. Of course a much larger set of mooted ideas are never implemented. The processes underpinning their creation and debate did not have requisite variety to make them happen. Indeed, this is not necessarily a bad thing! Often this is a safety mechanism to filter out unworthy propositions. The issues faced by collectives trigger organisations. I have argued that environmental stretching may trigger the need for organisation and over time for new organisational forms. In what follows I discuss the processes by which new organisational forms emerge as collectives look for responses to environmental stretching. If no
organisation emerges for a particular social issue the implication is that it does not develop identity and finally it is lost. It fails to develop systemic stability. Of course, in due course issues reach the end of their lives, however if they are going to have any impact in society they have to emerge as organisations with inner coherence and adaptability during a period in time. This is the trigger for new organisational forms. Some of them are likely to be more stable and successful than others. The formation of a collective in a social context implies shared interests and triggers the need to pursue them. This requires them to deal with multiple agents in their environment, something that challenges them to connect with each other in everstronger interactions, creating in the process new meanings. It is in these processes that meaningful products/services are defined and, moreover, it is in their conversations that collectively they will construct their environmental agents’ expectations and requirements (though when they are reactive rather than pro-active, they will simply map these expectations and requirements). As they develop collective models of their environment, they make decisions about courses of action, thus connecting meaning creation to meaning production. In this latter stage they supply products and services through processes that naturally reflect their values. Throughout these processes interactions are in progress between members of the collective and environmental agents, together constructing their shared reality. However, it is only when agents receive and acknowledge receiving products and services that the learning loop between them is closed. The multiple other demands on the agents from other collectives and other ecological factors are likely to express different concerns and values and thus produce a gap, triggering the need for ingenuity to bridge their different expectations and values. This is the problemsolving loop. Fragmentation (cohesion problems), lack of response capacity (response problems), lack of effective stretching (environmental problems) and lack of clarity about purpose and products and services (identity problems) are among the possible obstacles to this learning loop. Additionally, the collective operate in institutional/organisational contexts that enable and constraint to different degrees their interactions. These contexts may go from the simplest situation where the collective is embedded in one institution to the much more complex situation in which members of the collective belong to multiple institutions as well as to other collectives. Regardless of that specific situation, the embodiments of the issues of concern are embedded in more general issues, which themselves must have organisations producing them (otherwise they would not be distinguished). No meaningful product or service emerges in a vacuum. For instance, if the collective’s shared interest is the provision of local transportation, this issue is likely to be embedded within the issue of regional transportation. In practice this means that whatever organisation is producing local transportation, it is embedded by definition within the organisation producing regional transportation, which depends on local transportation to produce regional transportation. Both organisational systems may be produced by a variety of institutional and collective resources, however, the fact that we can recognise them as distinct services, one producing perhaps together with other local transportation systems the regional system, suggests that connectivity of these resources is happening one form or the other. Indeed, the cost of achieving this systemicity in society may be very high. Not to mention the issues that never achieve identity simply because of fragmentation and lack of resources.
In the paragraph above I said ‘whatever organisation is producing local transportation’. This suggests that the institution that is manifestly focused on local transportation may not have by itself the resources and connectivity required to produce an organisation, however the self-organising network emerging for this purpose, which may include a variety of other institutional resources, does. This is the organisational system we are interested to see as part of an effective learning process, to improve the quality of the organisational processes entailed in creating and producing this issue. Fragmentations, lack of resources but also poorly grounded shared meanings are obstacles to this learning. On the other hand, the more the collective participate in diagnosing and improving the quality of these processes, the more they show self-reference, the higher the chances of seeing necessary interactions to realise their shared interests. In other words, the better will be their chances of bootstrapping their conversations in structures that enable them to use their capabilities and develop their potentials. Assessing the desirability and feasibility of changes is the outcome of the relevant actors participating to the best of their abilities in conversations to bridge the gaps between the actions that the collective is producing and those that would be required to satisfy their expectations and purposes in the particular technological, structural and eco-systemic contexts of their operations. These are necessary human interaction systems to drive decisions and actions. For as long as the issues of concern or problems are contained by the collective, that is, for as long as these can be construed as performance and cohesion problems of, and within, the collective, their context will be the organisation-in-focus possibly emerging from their own interactions. However, if the issues relate to support networks that extend beyond the collective’s boundaries, the organisation to consider may emerge from interactions beyond the collective. If the issues are their relations of belonging, the structural context will be wider than the organisation-in-focus. In this case it is necessary to bootstrap the collective’s problem solving in wider organisational processes. In summary, organisational design is a wider issue than tinkering with institutions; it is producing the connectivity that is necessary among distributed resources in order to facilitate the creation and production of socially desirable meanings. Often the resources available are not sufficient something that stretches and taxes the ingenuity of the people involved. The challenge is to create resources from as yet unseen sources. Often this requires releasing existing human potentials by seeing and producing new relations. These are the new organisational forms. For particular issues, recognising obstacles in the bootstrapping of relevant interactions to their organisational contexts is a form of releasing potentials. Often this implies to understand how to bootstrap production processes, focused on performance, to organisational processes, focused on the constitution of organisational forms. Current developments in information and communication technologies (ICTs), as I will illustrate later, have increased considerably the scope for the design of both types of processes. These processes are key to bridge the ingenuity gap, suggesting that the more we understand them, the more likely it is that we will be able to catalyse them creatively in desirable directions. That is, the more likely it is that we, as social actors, will be able to recognise the edge of chaos for our relevant processes, rather than steer them towards either uncontrolled chaos or deadly passivity. This is the scope for
organisational design in this work. It is in this context that we talk about new organisational forms.
5.3 The Viable System Model An approach to study the requisite organization for a policy issue is to hypothesise that the different resources focused on it relate to each other producing an autonomous system, with the capacity to create, regulate and produce the policy issue. These resources can be the members of small collectives, large companies, regulatory bodies, government institutions or whatever. This hypothesis seems to be reasonable, since it implies the expectation that relevant resources will relate to each other in such a way that they solve their own problems, reducing fragmentation and dependence on unnecessary weakly related resources. Autonomy in this context means accepting responsibility for one’s affairs within the framework of being part of one or more larger systems. Indeed, policy issues do not appear from nothing; they are the outcome of processes of structural differentiation. Those dealing with one issue usually contribute, wittingly or not, to producing wider networks of meaning creation and production through their interactions with other autonomous systems and, of course, the interactions of smaller networks of meaning creation and production produce them. These contributions are likely to be the outcome of messy processes that require of competent observers to be unraveled. Structural differentiation happens where we succeed in producing7 a stable (far from equilibrium) meaning. If we use the example of local transportation as a system-in-focus, the hypothesis implies that there are resources in a given locality to create, regulate and produce its own transportation policies. A larger, embedding system, could be the system for regional transportation with capacity to create, regulate and produce its own meanings, responsible for the wider policies within which local transportation (most likely in several locations) takes place. Equally, within the system-in-focus we may expect to find self-organising teams creating and producing the products (e.g. roads) finally delivered to customers and society. These are forms of structural differentation or primary activities relevant to the hypothesized requisite organization for this policy issue. This devolving strategy assists collectives in coping with chunks of their environmental complexity. Observing this ‘Unfolding of Complexity’, or cascading structure, in recursive levels consisting of autonomous units within autonomous units (figure 2), is a way to check the coherence of the organisation’s created meanings (as languaged by participants) and the evolving body producing them. Together they should produce the requisite organization, which has coherent informational and operational domains. Lack of coherence suggests either revising its self-defined purposes (i.e. created meanings for the organisation) or developing an alternative structure (i.e. body). Here we can see in operation the bootstrapping of purpose and identity through structure.
7
Producing a meaning requires producing some form of product or service, however the essence of an organisation is not producing particular product or service but producing a meaning through a particular product or service. Hence the same organisation may produce many different products or services over time; as long as it maintains its identity it is the same organisation.
Figure 2 Unfolding of Complexity Regional Transportation Local Transp. 1 Local Transp. 2 Local Transp n
Local Transp 1
Local Transp 2
Local Transp n
Roads Public buses
Roads
Public Buses
Project 1
The hypothesis is that each autonomous unit or primary activity is a viable system in the sense that they can sustain themselves in time in spite all kinds of unexpected environmental disturbances (Beer, 1979, 1985). Two organizational processes produce an autonomous unit (a circle in figures 2 and 3); these are the adaptation and cohesion processes. These processes emerge from relating the resources producing five systemic functions, Policy, Intelligence, Cohesion, Co-ordination and Implementation, which together create, regulate and produce its products/services (Espejo et al, 1999). Implementation, through its own primary activities, produces these products. The adaptation process relates policy, intelligence and cohesion resources. Policy creates the policy issue as an outcome of managing the interactions of intelligence and cohesion resources. The Intelligence function is concerned with the ‘outside-and-then’, that is, with the long-term, taking into account the organisation’s problematic environment. The cohesion function is concerned with the ‘inside-and-now’, that is, with the organisation’s current achievements in its operational environment. The cohesion process is focused on balancing local autonomy and organizational cohesion. For this the cohesion function manages its interactions with co-ordination and implementation resources. For this purpose some degree of nonnegotiable corporate intervention8 needs to go hand in hand with resources bargaining to enable primary activities to create and produce their own autonomous tasks. Interactions between those in primary activities, with the local knowledge of their tasks, and those in the Cohesion Function responsible for the 8
For instance defining safety standards for road construction go beyond the competence of individual plants and therefore may be issued as ‘corporate intervention’ without negotiation.
cohesion of the system are crucial and cannot be based either on excessive intervention or naïve trust about the competence and sincerity of those in the primary activities. Sporadic, but on-going, audits are necessary to build up responsible trust (cf. orthogonal communications later in this paper). Additionally, the Co-ordination Function is concerned with local problem solving by enabling interactions among primary activities. For this it creates and enables the enactment of shared operational standards. The lower is the variability in those aspects that are not central to the purposes of the primary activities, the better will be the coordination among primary activities and the less corporate intervention will be required. A key aspect of this coordination is effective operational coupling. The same organizational processes relating the five systemic functions recur in all embedding and embedded primary activities (see isomorphic interactions and communications in figure 3), as requirements for their viability.
(V
Stretching
Intelligence
.
Problematic Env.
Policy
Cohesion
to V)
Operational Environments
Resources bargaining
Achievement and Performance
intervention
Coordination
Audit
Audit
Implementation
Figure 3: Viable System Model
Diagnosing the quality of the relations producing these organizational processes is necessary to refine our appreciation of the grounding of purposes into identity through structure. This diagnosis may clarify that a hypothesized primary activity in fact is not an instance of structural differentiation, but merely an amplification of a meaning already created at a wider level, since it does not have resources to create its own meanings. In fact, an appreciation of the distribution of resources in the requisite organization is necessary to assess its organizational processes. For this purpose we need to know where is the discretion in the use of resources and what are their systemic purposes.
How resources are distributed, where is the discretion in their use, throughout the requisite organization depends among other factors on strategic intent, technology and culture. In an organization one would expect to see some balance between resource centralisation and functional decentralisation so as to both optimise the use of resources as a whole and enable the autonomy of each primary activity to deal locally with external requirements. We may expect that the subsidiarity principle will apply in these situations, that is, functional centralisation makes sense only when the local level is not equipped to carry it out, or in other terms, everything that can be done more effectively at the local level is done locally. However, in practice the distribution of resources and functions is far from ideal. Methodologically, in order to study the distribution of discretion we use the table recursion/functions (Espejo et al, 1999). Understanding the actual distribution of functions and resources makes apparent the messy and often chaotic organisation of collectives. Also gives directions for improvement. The organisational loop aims at on-going improvements of the structural underpinnings creating and producing the policies of concern. It helps to understand the action domains emerging from the collective’s three key forms of interaction or relations: their internal interactions (relations of constitution), their interactions with agents in their environment (relations of production) and their interactions with participants in the wider structural level, enabling or inhibiting their structural differentiation (relations of belonging). This loop also provides the context for learning and problem solving. There are a number of possible obstacles inhibiting this learning (Espejo et al, 1996), but overall policy makers have in these requisite organisations the communication media between them and stakeholders.
6. Epistemological and Methodological Considerations in Problem Solving: The Viplan Methodology Having recognised the scope and relevance of organisational design I now offer a methodological framework for this purpose. I will reinforce the need for conceptual frameworks to support the contextual reconstruction of social connectivity, in particular the need for a language to support designing and for methods to cope with the complexity of social and technical processes. This design underpinned by the Viable System Model will give us the chance to recognise how to bridge communication gaps between policy makers and stakeholders, and in effect will show us that organisation is a key channel for one-to-many and many-to-one communications. Methodologically I want to answer the question: how do we know which is the body (requisite organisation) for the meaning it has yet to be created, let alone produced? The conceptual framework for this methodology takes into account processes of meaning creation and social reality construction. As members of a collective language their shared interests and develop connectivity they may experience and anticipate breaks (i.e. problem situations), which trigger their need for further connectivity thus potentially producing the structures providing a background to their interactions. Problem solving is concerned with meaning creation and also bootstrapping the production of these meanings with appropriate structural capacity. The methodology (Figure 4) establishes the interplay between the collective’s
expectations, purposes and meanings and the structures producing them. The learning loop is about creating meanings (human activity systems, Checkland, 1981) and also about producing them (human interaction systems). The organisational loop is about building up the necessary structural capacity to cope with the collective’s breaks in their interactions with environmental agents. Building structural capacity requires developing a network of relations, which if operationally closed becomes an organisation with its own identity and collective meanings. If these meanings are not aligned with those espoused by individuals they will trigger breaks, which may affect their relations and therefore the way they produce their organisation. Breaks relate to all the collective’s relations and emerge in the light of those aspects they want to conserve, based on self-reference and self-awareness.
The Viplan Methodology Observation: Finding out about problem situation.
Assessment: Creation of meanings (RDs) Hypothesis of relevant organisational systems (ISs)
Mapping environmental complexity: structural models Organisational Loop Improving organisational processes: organisational transformation and learning Implementation of Change:development of practices
Learning Loop
Diagnosing and designing organisational processes Designing: clarification of meanings (dynamic and conceptual models) and responses.
Figure 4 These contexts, underpinned by different degrees of structural fragmentation, will influence the emergent meanings. A fragmented collective is likely to find its problem solving more difficult than another with a body consistent with its intended purposes, able to produce behaviours consistent with avoiding undesirable breaks. The issue is building up the structural capacity to cope with disturbances and if possible avoid the consequences of unexpected turbulence. I discuss later that ICTs, in particular real time management, can provide this capacity. Problem situations are the triggers for organisational diagnosis and, if necessary, design. These problems are related to particular policy issues, which are created and produced by requisite organisations, in an operation where created meanings bootstrap and are bootstrapped by capacity to produce them. Policy issues define the action domains of interest and it is in these domains that we perceive and experience problems. As argued before the collective’s interactions with environmental agents happen at two levels; at the level of the problematic environment and at the level of the operational environment. The first one is about possibilities, that is, about issues
focused on the ‘outside and then’, beyond current capabilities. The second one is about achievements, that is, about issues focused on the ‘inside and now’, within current capabilities. An organisation’s performance is about the relation of its current achievements to its construed potentials. It is within this performance framework that issues of concern emerge. These are meanings impinging on the on-going creation and production of the action domain. The assumptions I have so far made are that there is a collective operating in a policy issue or action domain, in a context, with members sharing common meanings articulated by their debates and discussions. Their experiences and observations trigger their appreciations of the shared situation, in particular of the breaks they experience in their interactions. These observations can be of different quality, where high quality observations are responsible, as I will argue later, for knowledge creation processes. Their assessment of these observations may trigger a range of meanings, reflecting their worldviews and personal histories. People produce distinctions in language, at the same time of being blind to a wide range of other possible distinctions. It is in this languaging that they create meanings. At this stage, they are simultaneously in two conversations, one about the action domain (i.e. their purposes) and the other about issues of concern, or problems, while performing in this action domain. The first group of conversations are about grounding the collective’s shared interests in an organisation or purposeful human interaction system (i.e. HIS or action domain), the second are about creating meanings for perceived problems or in Checkland’s terms about naming human activity systems (i.e. HAS). Meanings are always created by interactions, that is, are created in action domains. There is interplay between these two conversations. The more clear is the action domain, that is, the more the collective has a sense of purpose and direction the more clear it will be for them to know who are the relevant stakeholders and therefore which interactions are necessary in order to produce the action domain. This is the process of producing a purposeful system or organisation in the collective’s operational domain. Indeed, this is itself an issue of concern for the collective, since we may expect that its members will ascribe different purposes to their collective actions. However, there are also a wide range of other issues of concern, emerging from their relations of belonging, performance and cohesion/constitution. What is interesting is to appreciate their bootstrapping to the HISs they are producing. The argument is that because systemically issues of concern are relational problems for a collective, methodologically it makes sense to connect them to an organisation -a requisite organisation- that is hypothesised as giving them context. For members of a collective to increase their awareness of relevant issues and assess, design and implement possible actions (the learning loop), it helps if they become aware of the organisation they are producing, more or less successfully, through their interactions (the organisational loop). The interplay between organisation and issues is necessary to work out communication and interaction challenges in construing, and dealing with, them. Methodologically I want to discuss the construction of these two loops (figure 4).
6.1 The Organisational Loop At a deep level an organisation’s purposes define the chunks of environmental complexity that the collective need to create/develop, and cope with, in order to produce their self-constructed purposes (i.e. meanings). This is a process of identity formation that takes place as the collective languages their shared interests, define the products and services they want to offer to agents in the environment, create environmental variety that stretches them, experience the need for connectivity and possibly, through self-organisation processes, produce their organisation. This organisation is a dynamic reflection of the environmental variety they are producing and dealing with. The collective need to consider two types of variety. On the one hand they need to consider their selected chunks of relevant environmental variety, on the other they need to consider their own variety to develop and contain this environmental variety (Conant and Ashby, 1970). This is a containment strategy of environmental chaos within limits. The chunking of environmental variety is an effort to account for selforganisation in the environment and, methodologically, takes the form of structural models. For instance groupings of suppliers and customers define these models (figure 5).
Figure 5: Suppliers and Customers’ based Structural Model
Their geographic distribution also defines them (figure 6).
Figure 6: Geography based Structural Model: Branches in Regions Their time dependence may also be responsible for chunks of relevant environmental complexity (figure 7).
Figure 7: Example of Time-dependent Structural Model: work in shifts
On the other hand, the distribution of organisational variety to cope with this environmental variety depends on the collective’s strategy to contain it (figure 8). Area A BMAs BMA B Service Centre X2 Lending Centre X2
BMA B CSB 1
CSB n Old Style Branch Corporate Rel Personal Rel
Service Centre
Lending Centre
(Processing Units)
(Processing Units)
Small Business
Account Handling
Personal X4
Voucher Processing
Gold Card
Personal Relationships
CSB 1
CSBn Dependent CSB Counter Branch
PAEs & Support Team PAMs & Support Team Corporate Relationships CAEs & Support Team CAMs & Support Team
Figure 8: Example of Complexity Unfolding (Unfolding of Autonomous Units within Autonomous Units) in NatWest Bank-UK Here is where ingenuity plays a key role. Organisational forms triggered by ingenious variety management strategies may hugely increase the collective’s capacity to deal with environmental variety. The relation between chunks of environmental complexity and organisational forms is at the core of bridging the ingenuity gap. For instance, it is very different to match people’s requirements for financial services by means of autonomous branches in the High Street or by means of direct on-line services. The organisation’s strategy for variety containment, its underlying technological models, in one and the other solutions are indeed very different (Bowling and Espejo, 2000). Methodologically, for a policy issue observers (including members of the collective) can hypothesise the requisite organisation necessary to cope with relevant environmental complexity as synthesised in the dialectic relation between structural and technological models. The observer can produce identity statements (IS) for the collective in either diagnostic or design modes. In a diagnostic mode these can be
expressions of either espoused theory or theory-in-use about their products/services for environmental agents. Their reflections about these organisation/environment relations, in particular from the perspective of theories-in-use (rather than espoused theories), should give them the chance of inventing more ingenious strategies to create and deal with environmental variety. This is the design mode. Visualising and debating these relations and inventing new forms to contain and manage them are at the core of producing new organisational forms. Central to identity statements are debates about system’s boundaries. Indeed the collective’s values and ethical stance have a fundamental impact in the creation and containment of variety. If these values imply concern about the exclusion of certain groups, avoidance of liabilities for future generations and so forth, the relevant environmental variety will be very different to a situation in which short-term selfish values dominate the creation and containment of variety. All the above methodological issues are focused on self-awareness and self-reflection about the meanings that a collective is creating in their relations with the environment. The scope for construction and de-construction of these meanings is indeed large. Though identity formation is an on-going process, the grounding of purposes and meanings in the identity of a collective, that is, in their relationships, requires of structures with the capacity to produce them. Purposes are in the informational domain of the collective; identity is in their operational domain. For the collective the challenge is producing requisite organisational forms and this requires focusing on the collective’s operational domain. Created meanings are produced by a requisite structure. If a meaning is produced there is a tacit structure that produces it, even if most of the time we are not aware about it. It is the embodiment of the collective’s recurrent interactions or relations. Here our methodological concern is the bootstrapping of the collective’s purposes in a structure with the capacity to produce them. The concern is the coherence between the informational and operational domains. Achieving this coherence is most difficult. Indeed, self-organising processes and the meanings that emerge from them often obliterate our desires and creative thinking. Most of the time we create meanings for which we don’t have the necessary bodies (i.e. structures to produce them); this is wishful thinking. But also, at the same time, the cognitive and operational capabilities of the available bodies, in their contextual backgrounds, restrict our creativity. Methodologically the challenge is diagnosing the tacit structures creating and producing the collective’s meanings and, if necessary, designing the requisite structures for their effective creation and production. These structures are defined by resources and relations, or in other terms by organisational processes relating over time available resources (cf. The Viable System Model). These are the organisational processes creating and producing policies that collectives wish, or have the desire, to make viable. This diagnosis may make apparent that the collective, perhaps in the form of an institution, does not have the necessary resources, nor has develop the necessary relations among them, to achieve the viability of their policies. This diagnosis may suggest the need of particular relations with other institutions, or institutional parts, to produce the requisite organisation. Or may suggest that extra resources and relations are necessary within the collective, or different and new
relations are necessary with suppliers and customers and so forth. In the end improving organisational processes imply not only having access to resources, but also producing new relations. This is at the core of organisational transformation. A collective achieves organisational closure when their resources and relations produce (in the operational domain) the meanings they create (in their informational domain). Though much research still needs to be done, it would appear that this coherence is seldom achieved, reflecting that much needs to be learnt about self-organisation processes and how to harness them in desirable directions. On the other hand observing organisational closure is common, suggesting that we adjust our expectations to the meanings that we are able to produce.
6.2 The Learning Loop The discussion of the organisational loop has helped us to understand how to improve the interactions producing a shared action domain among the members of a collective. The collective’s relations of constitution, performance and belonging may produce a Human Interaction System (HIS) that provides the collective with a structural and cultural context for the production of these relations. This circularity, based on selfreference, if achieved, will produce a shared reality (beyond their shared interests) constructed in the language of their recurrent coordination of actions, in which members of the collective are constituted as roles. At a phenomenological level members of the collective experience and observe problems in their action domains. It is in their interactions that they experience ‘breaks’, which they construe as shared distinctions in language in their informational domain, in a process of clarification and meaning creation. Methodologically these distinctions can be made explicit by naming holons and further expanded by conceptual modeling (Checkland, 1981). These are names of human activity systems that observers construe as epistemological devices to help them to think about the world, without assuming its systemicity9. However making distinction is not enough for learning and problem solving. The collective’s learning takes place when they ground these meanings into new practices in their operational domain. This is a problem solving process that develops the collective’s structural complexity (Espejo, 2000). Breaks may be experienced as performance, constitution and belonging problems, depending on which of the relationships is primarily recognised as problematic. However, there is a systemic interdependence among them, and understanding this interdependence is at the core of the Viplan Methodology. Collectives constitute themselves as organisations in particular structural and cultural contexts as they perform in more or less stretching environments. The organisational loop discussed above was all about this constitution. The learning loop is about the collective’s performance in producing products and services, as created in their self-constructed action domain. It is in this process that they experience the ingenuity gap, that is, they experience the stretching of environmental agents who have meanings of their own, 9
Human activity systems are very different to human interaction systems, they do not assume systemicity in the world. To support naming holons Checkland offers the CATWOE technique. To support naming systems Viplan offers the TASCOI technique. CATWOE supports the creation of meanings in the collective’s information domain, TASCOI supports the production of meanings in their operational domain.
triggered by their own local relations, that challenge both constructively and destructively, their efforts to produce their products and services. The recurrent lack of interest by the environmental agents to engage in interactions with the collective at the beginning can be construed as a form of stretching, however this would be a sign that members of the collective are failing to achieve connectivity at the edge of chaos, and therefore that the chances are that they will not emerge as an organisation. It is apparent that structure emerges from this stretching and therefore that structural adjustments are produced by recurrent learning episodes, something that bounds the scope for organisational design, but also makes apparent that structural changes can improve learning. This is the meaning of organisational learning in this work. The methodology highlights the interdependency of structure and learning and offers tools to strengthen it in our actions (Espejo, et al 1996). As a collective develop connectivity among them, and through recurrent interactions produce relations that constitute them as an organisation, they are constructing their cognitive space, which is the embodiment of their relations producing their identity. The more they develop this identity the stronger will be their position in producing their own meanings at the expense of those in their environment. This is a consequence of developing autonomy. Its implications for the collective’s communications are staggering. For instance, this effect of systemicity can be appreciated with reference to our central nervous system (CNS): “Consequently, the synaptic gap can be seen as the “micro-environment” of a sensitive tip, the spine, and with this interpretation in mind we may compare the sensitivity of the CNS to changes of the internal environment (the sum-total of all micro-environments) to those of the external environment (all sensory receptors). Since there are only a hundred million sensory receptors, and about ten-thousand billion synapses in our nervous system, we are 100.000 times more receptive to changes in our internal than in our external environment.” (von Foerster, 1984 p.300)
In social terms this has advantages and disadvantages. On the one hand such a collective is likely to communicate meanings clearer on the other they will become more concerned with their own viability at the expense of wider interests. A strong inner connectivity transforms the concerns of those in their environment in disturbances that the collective need to accommodate, often at the expense of being sensitivity to these concerns. A weak inner connectivity makes it more difficult to appreciate the meanings that the collective want to communicate, watering down their products and services, and making less likely organisational learning. This is the typical situation of a fragmented collective. An observer’s appreciation of the quality of these processes of constitution can provide important insights into the kind of problem solving that may take place in a particular situation. For instance, if the senior management team within a collective develop among themselves strong connectivity while the rest remain fragmented and weakly connected, the chances are that the interests of this team and not of the collective, despite any claims to the contrary, will drive problem solving. It is also possible to have a cohesive, well-structured collective, dealing effectively with performance problems however if they don’t pay attention to their relations of belonging, sooner rather than later they will pay for that behaviour. Their relevant wider contexts will naturally drift in directions that may not be coherent with those of the collective, leaving them void of context, and therefore possibly making irrelevant
their performance efforts. Observing these relational weaknesses allows the collective to anticipate possible problems and to make more meaningful their products and services. The ability to make distinctions in the environment, that is, the ability to appreciate performance problems and the capacity to design and produce responses relates to the quality of the collective’s bodyhood and their contextual positioning. In practice this means the development of functional and structural differentiation according to the collective’s self-defined purposes. It is critical to pay attention to the roles involved in the assessment of a situation and in the design of responses. For instance, if the concern of the collective is creating new ideas to develop and maintain stable relations with environmental agents, it is necessary to orchestrate balanced conversations among those (roles) focused on the ‘outside and then’ and those (roles) focused on the ‘inside and now’ in relation to the collective’s purposes. This is a processual requirement to produce desirable and feasible ideas sensitive to the environment and well grounded in the collective’s structure. It is a self-referential process in which structure produces meanings and meanings produce structure. Awareness of the self helps members of the collective to orchestrate functional conversations to create and produce their purposes. On the other hand lack of awareness of the self may allow the unfolding of conversations that over time produce an undesirable identity or fail to establish an identity altogether. These are ineffective or irrelevant conversations. Equally, a structural appreciation of the environmental variety, that is, of possible ways of chunking it, may help to speed up the formation of requisite structures for an effective performance, creating and producing a recursion of meanings, from the global to the local. From the perspective of performance this implies recursive learning. For each of these learning loops, observation of problematic situations, their assessment, the design of possible responses and their implementation is the problem solving process. This learning epistemology has important implications for modelling and communications in the context of a collective’s problem solving. Both are key aspects for the clarification and development of meanings to build ingenious bridges between the collective and its environment. Modeling in general is understood as a simplification, from a particular viewpoint, of a situation. This simplification is often intended to capture as accurately as possible a significant aspect of this situation. In the best of cases we talk about an isomorphic mapping of the situation (Beer, 1966). This kind of modeling is useful in situations where there is a substantial agreement about their nature. In scientific terms this could be a situation in which high quality observations have yielded an object (e.g. the laws of gravity). These are situations in which the dictum ‘the map is not the territory’ holds (Bateson 1973, page 375). However, from a constructivist perspective social situations are unfolding as people interact with each other and there is no independent reality to be mapped by the observers, whose observations are themselves changing the observed situations. Indeed their observations and actions produce the situation. This is the case where in spite of recognizing that modeling implies attenuation, through selection, we could argue that ‘the territory is the map’ (Harnden, 1989, Reyes 2002). From the perspective of a collective, participants are contributing to
constructing their shared territory, or human interaction system. This territory emerges and unfolds from the distinctions made in their interactions10. The individual modeling of a situation can be understood as the languaging of distinctions to support interactions. These distinctions are observer dependent and imply a selection or variety attenuation vis-à-vis the situation (cf. figure 1). Naturally this is the same for every individual and their distinctions (i.e. models of the situation) may differ, and different criteria to make these distinctions produce different models. Models are epistemological devices supporting individuals’ interactions. But individual modeling is not independent of collective modeling, which can be conceptualized as the non-linear transformation of individual models into collective models, emerging from their connectivity. This is a process of sharing individual mental models, which happens in language. Individual models, as an expression of knowledge encoding, are by and large tacit, since language evolves and is history dependent. Our individual tacit models emerge from social communications more than from interactions, however our shared tacit models depend strongly on interactions (the organisational loop). It is apparent that the nature of these shared realities depends on the communicative competence of participants and the available structures for collective interactions. To what extent is the emerging shared language reflecting the appreciations of all involved and not mainly the appreciations of some of them? Since communicative competence and effective structures are generally in short supply we may expect that there is significant room in all situations for improvement. This is the space for learning. For a collective to learn, that is, to act more effectively in their selfconstructed action domain, they require improving the quality of their shared models, but this is only possible if as an outcome of their experiences in co-ordinating their actions (as a result of making distinctions in language), they develop new practices, which affect the situation and trigger new distinctions in the collective, which they construe as new shared models. Models relate to distinctions, territory to distinctions and coordination of actions, but there is reflexivity between the two. Though our common sense suggests that models are different to reality, their generative mechanisms in collectives suggest that shared models are their shared reality. The territory is the map. The collective territory is a non-linear transformation of the individual territories. The shared territory, as opposed to the individual territories, is the outcome of shared distinctions in language, supporting their coordination of actions, and triggering new distinctions. Shared models emerging from individuals’ interactions are in the collective’s operational domain. They encompass their incorporated practices since it is only through coordination of actions that we can observe them and therefore can be considered as tacit knowledge and define the collective’s complexity (Espejo, 2000). Effort to make explicit these models plays a fundamental role in defining the collective’s boundaries of agreements, and this is an area where ICTs can play an important role (Reyes, 2002). 10
This is an important epistemological point: our selections or distinctions make invisible the wide range of possibilities that could have been seen and we left out. Is the unobserved event of a fallen tree in the forest a real event or not? The point is that that event could have been any of the multiple possibilities that a tree can take in a forest and we don’t know which one was the case. This is an undetermined reality that is only constructed once a distinction is made.
We create formal models to enhance our boundaries of agreement, but for this to be the case these models need to be inserted in the collective’s learning. Therefore a Viable System Model of an organization is neither a representation of the collective nor the collective itself. It is a set of distinctions in language made by one or more participants in the situation, which may influence their conversations and trigger new insights and coordination of actions. The model gives its users a number of distinctions that help them in their interactions, perhaps in the direction of increasing the chances of a more effective transformation of individual tacit models into shared tacit models (i.e. of participation). It is a self-referential model, focused on the system itself, which assumes requisite structures for effective learning and participation! Again we encounter the need for bootstrapping. Members of the collective, confronted to particular performance situations, may develop explicit shared models of their environment. Even if their intention is to map the environment, they are producing a non-linear transformation of their individual distinctions, which emerges from their structural couplings within the collective and operational couplings with agents in their environment. In general these models contribute to bridge what we have called here the ingenuity gap. They help to see threatening situations and opportunities. More and more in recent times these models are developed to help the collective to anticipate the consequences of their interactions, making apparent an increased awareness of the ethics of the collective’s actions (Beer, 1996). This concern for anticipation is making increasingly necessary to model social issues as webs of connected events, making apparent the systemic nature of problematic situations, that is, the dynamic interdependence of our decisions and actions (Senge, 1991). However, for these models to be relevant they have to support coordination of actions and this implies developing the requisite organization to make possible the collective’s gliding in their environment (Espejo and Zarama, 2000). If this modeling is decoupled from the structures underpinning it we may expect wishful modeling and irrelevancy. The collective needs the requisite bodyhood to transform meaning creation into meaning production. This is the generative power of models, however, this capacity to implement change implies developing requisite structures. Again we encounter the bootstrapping of learning and structure, of problem solving and requisite organisation. The learning loop acknowledges that we need sharing meanings not only about what we want to construct, deconstruct and reconstruct but also about possible breaks in the organisation’s co-evolution with agents in its environment. Shared meanings and construed breaks are the outcome of communications and interactions in language. They are languaged by people with different backgrounds and histories, contributing to the production of different social systems, and therefore intersecting the organisation from different orthogonal contextual positions, and, also with particular linguistic structures, rich and restricted. These are two further epistemological points I want to make in relation to the learning loop;
6.2.1 About orthogonal communications Whenever a collective become an organization with its own identity and structure an interesting communication dilemma emerges. Their inner structural couplings make them structure determined and this implies that their communications, as explained above, are dominated by their inner connectivity and not by their environment
(Maturana and Varela 1987, von Foerster 1984). This is something we all experience at the individual level; our inner stability defines the interactions we accept and the strategies we use to deal with environmental disturbances. At the level of a collective we may expect a similar situation, provided they have developed organizational closure. Given this situation their interactions with environmental agents will be operational rather than structural11. Because there are no recurrent interactions among them we cannot expect the emergence of stable relations and shared tacit models, something that makes communications among them more difficult. Information transmission may not be difficult, but competent communications among them is likely to be a problem. Members of the collective and agents, both autonomous systems, have to overcome operationally and not structurally the gap opened by the complexity of functional differentiation. Their interactions are taking place in a communication environment that is hugely complex; this is the complexity of relevant social systems for which they have no recurrent channel capacity to overcome. This fact hinders understanding. They are experiencing orthogonal communications but their interactions are taking place in a context where there is no single body or organization to integrate non-intersecting domains. This is the problem of transduction, that is, of crossing each other’s boundaries. In their interactions they have to produce a point of intersection that produces communication, rather than just information transmission. This is a hugely important problem in society and institutions today. Moreover this is a hugely important problem for organizations themselves. In organizations the problem is, as explained above, that structural complexity produces autonomous systems within autonomous systems, that is, structural recursion. Each is dominated by their inner interactions and the communications of related social systems. As structure determined systems their identity has emerged from success in integrating communications in one body. However, this very structural determination increases the difficulty of communications among them. The advantage in this case compared to communications with environmental agents is that they are likely to accept an alignment of interests. But, if communication and not only information transmission is going to happen between them, their interactions need to have requisite capacity to bridge their communication gaps. This is seldom the case in our institutions. Weaknesses in orthogonal communications are perhaps responsible, to a significant degree, for the lack of systemicity in collectives. From the perspective of modeling, these considerations imply that formal modeling that does not recognize problems of orthogonality may prove fatuous, expensive and in the end irrelevant. These models make more sense in environments where there are tacit shared models, or alternatively need to recognize the difference between strongly and weakly coupled situations. In the latter case the formal modeling needs to recognise the additional problem of transduction. This point is particularly relevant within organizations.
11
Structural coupling emerges from people’s recurrent interactions in particular in organisational systems; on the other hand operational coupling happens when people share communication contexts provided by social systems, rather than by interactions. For instance, professionals may be operationally coupled by the social system they create through their communications.
6.2.2 About rich and restricted languages Since modeling is about making distinctions in language in an action domain, it becomes particularly significant the language in use. There are languages that open up people’s possibilities for personal decision-making, increasing their chances to control their own futures and develop their potentials (de Zeeuw, 1998, Humphryes et al, 2001). Other languages have the opposite effect, and of course, there are all shades of grays. Humphryes research explains how, through the interplay of modes of composing in multimedia (textual, audio-visual) and modes of language (observation, action), it is possible to provide people with extended language opportunities for showing as well as telling about what is and what can be. Rich, extended, languages make possible for people to use their capabilities and potentials, create and discover resources, thus enhance their opportunities to cope with environmental disturbances and also strengthen their belonging to the collectives they choose to belong to. These languages reduce the chances of social exclusion. There are other, more restricted languages, which reduce people’s possibilities for local decision-making and increase the opportunities for others to monitor their behaviours. Languages that allow a person’s construction of creative distinctions are likely to support much richer processes of social construction and decision-making, but also will require more demanding communication contexts to resolve increased problems of orthogonality. On the other hand languages that contextually restrict the person’s construction of distinctions are likely to support more focused, but also more vulnerable processes of social construction, increasing the chances of social exclusion. Languages that allow a collective to absorb a large variety of environmental disturbances at the same time of strengthening their identity can be characterized as rich languages. Rich languages are those whose distinctions accept a large degree of individual variation at the same time of producing a high degree of correspondence between them and individual actions. On the contrary restricted languages are those that produce distinctions that can only be decoded and acted upon by a few people, thus increasing the chances of social exclusion. Therefore rich languages allow people not only to make distinctions but also to create local, distributed, responses. These languages should enable the reconstruction of people’s contextual backgrounds making possible the separation of phenomenal domains. This permits the emergence of autonomous units within autonomous units, recursively, while clarifying the contexts for their cohesion. Rich languages enhance the boundaries of contextual agreement, at the same time of increasing local problem solving. This is a research issue.
7. ICTs and Organisational Systems The purpose of this section is to explore the contribution of ICTs to organisational transformation; the key strategy for problem solving offered in this paper. Are these technologies fundamentally changing our construction of reality? What is their role in the production of social systems and organisations? Is there anything that distinguishes ICTs from other technologies? Will they enable the production of knowledge that so far has proved elusive to society?
Throughout this discussion I will assume the co-evolution of social and technological processes12. Indeed, it is difficult to argue whether technology leads organisational transformation or the other way round. Though in some cases it can be seen that one is pushing the other, I accept their mutual determination in the longer run. Connectivity proliferates variety and makes necessary the unfolding of complexity in organisations. Self-organisation and to some degree explicit management of complexity produces structures. ICTs can play key roles in constructing new organisational forms by enable collectives to produce and contain variety and complexity. We need to appreciate their generative power in constructing stable relations and making possible structural solutions to apparently intractable problems. Perhaps it is their capability to generate collective knowledge that makes them special among the multiple technologies available to society. In this section we explore the meaning of this generative power of ICTs. The overall argument is that they enhance our capacities to observe each other’s actions and to learn from each other, and that this enhances our capacity to produce organisations or teams with embodied collective knowledge. To the extent that this production can be recursively expanded to larger organisations ICTs have the potential to transform society. The challenge is to harness their transformative power in directions that produce inclusion, ethical behaviour and desirable social values. Unfortunately their current impact appears far removed from these desirable directions. When thinking in abstract terms there is the risk of trying to fit the world into our models, imposing more structure into reality than it is warranted by our day-to-day experiences. This is not necessarily a bad thing as long as models give us insights and direction to cope with the complexity of the world. They may help directing processes of self-organisation and producing order out of chaos. We learn, often at high cost, that there are some structural forms that deal more effectively with complexity than others. Systemicity, that is, mapping the natural connectivity of the world, asserts itself. These are all untidy and lengthy processes, but people produce sense over time. Often we learn the hard way about the consequences of our actions. It is in this evolutionary context that ICTs are playing their role. In the same way that the development of telescopes and microscopes in the 17th century gave us the ability to see nature and produce the scientific revolution, it is arguable that the information and communication technologies of today are giving us the ability to produce what de Zeeuw has called ‘combinatorial nature’ (de Zeeuw, 2002), that is the situated knowledge emerging from enabled and also restricted connectivity. This is knowledge embodied by the relationships underpinning our interactions in particular communicative contexts. This is knowledge that could, and should, give us more control of the social values we produced through our interactions. This is an opportunity to deal with the most intractable problems of society, like injustice, abuse of power and exclusion. ICTs may give us the opportunity to deal constructively with the ingenuity gap. ICTs have a massive capacity both to produce and absorb variety and to enable individual and collective learning. In spite of many counter-productive an unimaginative applications, the computer revolution of the past 40-50 years has had deep effects in the transformation of our institutions. Their co-evolution with 12
Social processes are the defined by the unfolding of social activities constructing society. Technological processes are defined by the unfolding of social activities producing technological innovation.
management and business processes has played a significant role in the transformation of the functional structures of the 60s and 70s into the divisional and business unit structures of the 80’s, and more recently into the autonomous team structures of the turn of the century (Espejo et al 1996, Stewart, 2002). Over time information and communication technologies have enabled the unfolding of institutional complexity making possible the emergence of autonomous units within autonomous units, constituting themselves into generative mechanisms for organisational transformation. At the same time they have allowed teams/organisations to network with others along their self-created value chains of suppliers and customers, making possible the constitution of, sometimes, highly effective network organisations (Castells, 2001). From number crunching machines computers have evolved into communication devices and these days we are witnessing a huge proliferation of new networked devices, driven by more and more sophisticated and clever software. My argument here is highlighting this huge increase in connectivity and observational capacity that ICTs are producing in today’s societies, at the same time of accepting that there is much we need to learn about their use and restrictions. For instance one of the topics discussed by the SISN network was: “ICTs and the approaches by which they are developed can enhance data access and transmission but not interpersonal communications; they don't take account or provide the channel capacity required by the embodied nature of human communication and cognition. In particular they restrict the expression of emotions and thus restrict significantly the scope of virtual conversations in human interactions.” (Black Group). This topic has been indirectly explored in the sections above and now can be further clarified. In the 70s the main source of data concerning the performance of companies were periodic reports for managers. These reports were by definition out of date, often too detailed and, in general, weakly focused on users. Their resolution was coarse. For instance, they were often unable to discriminate results for different products, product lines and production lines and therefore useless for operational managers. Aggregations, with reams of useless data, arrived to the desks of corporate managers at the centre of these companies. In this scenario those dealing day-to-day with products and services did not receive the necessary feedback to act upon their ‘controllable’ variables and had to wait for information/decisions from above for this purpose. Moreover, when ‘feedback’ in the form of local data was available, like for instance sales data for regions, local managers did not control key aspects of the operations to act upon the received data. Their local autonomy, rooted in their physical distance from the centre, could not be supported by discretion in key aspects directly affecting their performance. Structurally they lacked the necessary connectivity to coordinate their actions with production. Managers needed faster and better-focused updates of information. The development of ICTs and personal computers, slowly but surely, have made possible this learning. Managers have been increasingly able to acquire data according to their own needs, at the resolutions required by their tasks. At the beginning these developments were mainly on aspects of production rather than about external changes in demand and general environmental information. In an often-untidy process, driven more by selforganisation than design, we have witnessed a gradual devolvement of
responsibilities, and initiatives have increasingly been taken at more local levels of management (Stewart, 2002). During the late 80s and early 90s we witnessed the bringing together of various functions that previously were separated in corporate/divisional departments such as Finance, Marketing, Sales and Production into ‘Strategic Business Units’. Centralised management evolved towards more distributed forms of management based both on distributed information systems (the so called Executive Information Systems of the 80s) and an increased integration of middle level managers at the level business units. For the past decade this integration has taken place at more operational levels. For instance, the natural operational links between those on sales activities, concerned with external demand and the environment, and those on production (whether of physical products or services) have become increasingly visible. Their reliance on optimisation models to drive communications between different locations proved inadequate to react to market changes, to the rapid evolution of the demand and to changes in customer requirements. It was apparent that different kinds of communications were necessary between sales managers and production lines. In due course this evolved by the emergence of local information networks supported by bulletin boards, messaging systems and e-mail, which have strengthened the anticipatory power of companies. This evolution in information flows and communications has enabled the emergence of virtual teams integrating the ‘inside and now’ and the ‘outside and then’ of individual product lines. These integrated teams have far more variety to manage local businesses, and respond to environmental variations, than middle managers ever had. New organisational forms have emerged from the further unfolding of the company’s complexity into even smaller autonomous teams within strategic business units. Computer Supported Cooperative Work (CSCW) has enabled virtual teams in all kinds of institutions. For instance virtual lending teams in banks, constituted by people working in high street branches, with local knowledge, and experts working in centralised lending and security services have made it possible the functional decentralisation of specialised resources (Bowling and Espejo 2000). Similar types of teams have been emerging in the public sector as reported by Stewart (2002) in relation to drugs and crime prevention in the UK. This trend towards higher organisational complexification, that is, towards deeper structures, based on the development of individuals’ potentials with the support of ICTs is in progress today. Currently some companies, aware of their social responsibility, are further developing autonomous teams, beyond the integration of their value chain activities. Beyond production, sales and distribution teams in these companies are becoming responsible of sustainable businesses concerned with environmental and safety issues at the local level. These teams, increasingly aware of their own goals, capabilities and potentials, and enabled by knowledge of their performance in real time, are enacting yet new organisational forms; the sustainable business team. The trend emerging from the co-evolution of ICTs and organisational processes is to take away fewer aspects from the discretion of local teams. This trend is opening the space for people with increased competencies at the local level and better connected, thus opening the opportunity for inclusion within companies. This evolution, taking place in some of the more socially sensitive developed economies, is
a far cry from the global situation. However the potentials are there for ICTs to bring into life those so far forgotten and excluded places. The organisational implications of these trends cannot be underestimated. These changes potentially are increasing in orders of magnitude our institutions’ capacity for variety generation and absorption. The issue here is not offering a rosy picture of the co-evolution of ICTs and organisations and society. There is no doubt that resistance to these changes is taking place today and that abuse of power is as rampant now as it was in the past. However the trend imposed by ICTs is towards more transparency and as we learn more about the nature of organisations, abuses of power in the form of unilateral decisions will become more visible, and indeed they are becoming more visible today, as made apparent by the cases of corporate scandals in the USA during the past two years. And, as the competencies of people in institutions and society grow, as their spaces for connectivity are clearer, we may expect fundamental changes in relationships and organisational identities. The outcomes of these evolutionary forces are not predictable and indeed chaos, rather than stable new organisational forms, may ensue growth in connectivity, however for society this is an opportunity to channel self-organisation in desirable directions. Perhaps a key challenge in order to bridge the gap between chaotic self-interest and collective interests and values is increasing people’s communicative competencies at all levels, but as I have argued in this paper, additionally it is necessary to make available enabling structures to develop these competencies. Furthermore, this co-evolution of ICTs and organisational processes is rapidly going beyond the boundaries of individual corporations and institutions. The Internet is affecting connectivity in all venues of life. For instance it is making possible research projects beyond our wildest dreams. The BBC reported in its website the 22 of January of 2002: “New treatments are needed to treat anthrax, as it is becoming increasingly resistant to current antibiotics. A coalition of scientists and technology companies hopes to speed up the search by recruiting the spare capacity of thousands of home PCs. Similar schemes have been launched to hunt for extraterrestrial life and for new treatments for cancer… A technique known as peer-to-peer technology makes it possible for the spare capacity of millions of computers to be combined in a massive joint effort. Participants download a screen-saver that runs whenever their computers have resources to spare, and uses that power to perform computations for the project. … with enough participants, the project would provide researchers 10 times more power than the world's best supercomputer.”
It is apparent that with anthrax, as with other related bioterrorist threats, speed to discovery is of the essence. Internet can be at the forefront of bridging the ingenuity gap. However, it is in the economy that Internet and other ICTs are producing a deep transformation by promoting global connectivity; the e-conomy. They are producing network organisations, and this change is having fundamental implications for society. Examples like Cisco, Nokia, Zara and many more (cf. Castells 2001, Chapter 3) show the great power of networks enabled by the Internet. The case of Cisco is particularly insightful: “There is widespread consensus in business circles that much of the competitiveness and productivity achieved by Cisco derives from its business model. Cisco is organized around a
network open to both suppliers and customers: Cisco's Connection Online (CCO) had in 2000 about 150,000 registered users, and was accessed monthly 1.5 million times. Entering the system through Cisco's website, customers specify their needs and are helped by pricing and configuration agents which allow thousands of authorized representatives of customers and partners to define and price Cisco products on-line. When the interactive process between customers and suppliers reaches an agreement, Cisco's suppliers manufacture most of the products, and ship them directly to the customer. Customer service and technical help are largely automated, with most technical information posted on-line. Cisco also provides free consulting and training on the installation, maintenance, and repair of computer communication networks. Using this system, in the first half of the year 2000, Cisco sold 40 million dollars a day on-line, accounting for 90 percent of its orders. Of these orders about 60 percent are fully automated without requiring any action from Cisco personnel. About 80 percent of customer service requests were also handled over the web.” (Castells 2001, pages 69-70)
However, this Internet based transformation is of a different kind to that of sustainable autonomous teams, explained above. We need to understand the meaning of Internet in social and organisational terms. “…Internet … is not just a technology. It is the technological tool and organisational form that distributes information power, knowledge generation, and network capabilities in all realms of activity. Development without the Internet would be equivalent of industrialisation without electricity in the industrial era (Castells, 269).
Accepting that our institutions are locked in the Internet economy, the challenge is avoiding using it blindly. My argument is that at the same time that networks offer an extraordinary scope for economic growth they may run short of enabling sustainable growth. There is an important difference between an organisation, in the sense developed in this paper, and a network organisation, in the sense proposed by Castells. An organisation may emerge from a collective as their connectivity makes possible bridging gaps in the natural orthogonality of their communications. In sustainable autonomous teams there is a knowledge development process that emerges from individuals’ crossing each other’s individual boundaries. These boundaries are produced by individuals’ histories and are reflected by the social systems that they produce through their actions. In this sense organisations are retention mechanisms that produce the cross fertilization of social systems, and as such they are generative mechanisms of social knowledge. The extent to which this kind of organisations are emerging in society today and the meanings they are producing, is a mooted point and no doubt should be the concern of empirical studies, however examples like sustainable teams and the mafia make apparent the opportunities and threats to society that they pose. This emergence of organisation is different to the so-called network organisation, which is driven by a value chain and economic growth. There is the risk that collaboration driven by optimising the viability of the components of the network at the expense of the global interests may endanger sustainability in the longer run. Network organisations seem to be driven by information exchange rather than by communications. The danger is that their retention mechanism is economic interest rather than sustainable environments (which entails many more social systems!). These concerns do not invalidate network organisations however suggest that they need to operate in contexts with an overview of their activities, something that suggest the need of providing society with guardianship capacity. In a chaotic fashion, perhaps this is a key role that the civil society is playing today.
The extent to which ICTs are running ahead of organisational processes is a matter of concern and something that again requires careful attention in order to avoid unexpected and undesirable outcomes from their current developments and applications. How are ICTs changing the balance between the local and the distant? What are ethical imperatives in the global interconnected society? How is the systems’ epistemology changing ethical concerns in modern societies? (Green Group) But perhaps the key issue here is that ICTs are increasing social connectivity and the expected outcome of this connectivity is the evolution of organisations and networks as retention mechanisms producing desirable and undesirable knowledge. Understanding this knowledge generation processes is a great challenge. Achieving this end and learning how to harness this knowledge may well offer our institutions an as yet untapped problem solving capacity.
8. Conclusion The purpose of this paper has been to offer a contribution to our understanding of problem solving in the information society. Starting from social complexification and the chronic lack of ingenious solutions to social problems, my argument has been that effective communications and interactions, in the form of requisite organisations, offer a chance to deal with this ingenuity gap. The challenge is to enable necessary connectivity in collectives for them to emerge as effective organisations with the capacity to relate stakeholders to policy makers in virtuous loops of learning and transformation. I have argued that, in a given context, for a policy issue of concern it is possible to hypothesise a requisite organisation to create, regulate and produce the products and services that it implies. Moreover, I have argued that collectives producing this organisation in accordance with criteria for viability open up interaction spaces to realise individuals’ capabilities and develop their creativity and potentials, aligned with their collective interests. It is natural to expect that producing these communicative and interactive competencies is fraught with problems. I have recognised cohesion, performance and belonging relations as sources for these problems and offered a methodological framework to deal with them. This is the Viplan Methodology. Organisational design is a strategy for problem solving, however this design is a wider issue than tinkering with institutions; it is producing the connectivity that is necessary among distributed resources in order to facilitate the creation and production of socially desirable meanings. Often the resources available are not sufficient something that stretches and taxes the ingenuity of the people involved. The challenge is to create resources from as yet unseen sources. Often this requires releasing existing human potentials by seeing and producing new relations. These are the new organisational forms. Realising potentials implies recognising constraints in the bootstrapping of interactions to their contexts to deal with particular issues. This is the bootstrapping of production processes, focused on performance, to organisational processes, focused on the constitution of organisation. Current developments in information and communication technologies (ICTs) have increased considerably the scope for organisational processes design. These processes are key to bridge the ingenuity gap, suggesting that the more we understand them, the more likely it is that we will be able to catalyse them creatively in desirable directions.
In conclusion, in this paper organisational design is offered as a key communication strategy between social stakeholders; it allows for mutual understanding and coordination and opens the opportunity for sustainable, socially acceptable, policies. Organisation is the integrating body of multiple social systems, which provides the interaction space for orthogonal communications of people with different histories and backgrounds. This integration does not happen in situations where connectivity does not produce organisation, in which case communication is dominated by information transfer and not by mutual understanding. This is an important conceptual construct to appreciate the magnitude of the organisational design challenge. However, in the final part of the paper, I argue that information and communication technologies, if harnessed along the lines of effective organisational processes, may offer this opportunity to future generations.
References Ashby, W. R.(1964). An Introduction to Cybernetics. London: Methuen. Bateson, G. (1973). Steps Towards an Ecology of Mind. St Albans, Herts., UK: Paladin. Bowling, D. & R. Espejo. (2000). Exploring Computer Supported Co-operative Work in a Retail Bank, Proceedings of in of The World Congress of the Systems Sciences and ISSS 2000, presented at the International Society for the Systems Sciences 44th Annual Meeting, (eds. Janet Allen and Jennifer Wilby), Toronto, July 2000 (9) ISBN 09664183-5-2. Beer, S. (1966). Decision and Control. Chichester: Wiley.Beer, S. (1979). The Heart of Enterprise. Chichester: Wiley. Beer, S. (1981). Brain of the Firm, (2nd ed.), Chichester: Wiley. Beer, S. (1985). Diagnosing the System for Organisations. Chichester: Wiley. Beer, S. (1996). The Culpabliss Error. Memorandum Marking his Seventieth Birthday. Liverpool, John Moores University, September. Capra, F. (1996). The Web of Life. London, Harper Collins Publishers. Castells, M. (2001). The Internet Galaxy. Oxford. Oxford University Press. Checkland, P. (1981). Systems Thinking, Systems Practice. Chichester: Wiley. Conant, R.C. (1979). Communication without a Channel. International Journal General Systems, Vol 5, 93-98. Conant, R. C. & Ashby, W. R. (1970). Every Good Regulator of a System must be a Model of that System. International Journal of System Science, Vol. 1, No 2, 89-97. Espejo, R. (1994). What is Systems Thinking? System Dynamics Review, Vol. 10, Nos. 2-3 (Summer-Fall), 199-212. Espejo, R. (1989a). The Viable System Model Revisited. In: Espejo, R & Harnden, R , eds. The Viable System Model: Interpretations and applications of Stafford Beer’s VSM. Chichester: Wiley. Espejo, R. (1999). Aspects of identity, cohesion, citizenship and performance in recursive organisations, in Kybernetes, Vol. 28 Number 6/7, 640-658. Espejo, R. (2000). Self-construction of Desirable Social Systems. Kybernetes, Vol 29, Number 7/8, 949-963. Espejo, R. (2001). Auditing as a Trust Creation Process, in Systemic Practice and Action Research, Vol. 14, No 2, pp 215-236. Espejo, R. (2002). Self-Construction and Restricted Conversations, in Systems Research and Behavioural Science, Forthcoming Espejo,R, Shuhmann,W, Schwaninger, M and Bilello, U. (1996). Organizational Transformation and Learning, Chichester, Wiley. R. Espejo and N. Stewart, (1998) Systemic Reflections on Environmental Sustainability, in Systems Research and Behavioural Science, 15, 483-496
Espejo, R, D. Bowling & P. Hoverstadt (1999). The Viable System Model and the Viplan Software, in Kybernetes, Vol 28 Number 6/7, 661-678. Espejo, R. & R. Zarama, (2000). Organisational Adventures in Driftland. Unpublished Paper presented at the International Society for the Systems Sciences 44th Annual Meeting, Toronto, July 2000. Flores, F. (1982). Management and Communication in the Office of the Future. Doctoral thesis, Stanford University, California. Harnden, R. (1989). Outside and Then: an Interpretative Approach to the VSM. The Viable System Model: Interpretations and Applications of Stafford Beer's VSM, (eds R. Espejo & R. Harnden). Chichester, Wiley. Homer-Dixon, T. (2001). The Ingenuity Gap. London, Vintage Humphryes, P., C. Lorac & M. Ramella (2001). Creative support for innovative decisions. Decision Support in Action (eds. P. Humphreys and P. Brezillon) Hermes, Paris. Luhmann, N. (1995). Social Systems. Stanford California, Stanford University Press Leydesdorf, L. (2002a). Modeling social systems as anticipatory systems, University of Amsterdam. Amsterdam School of Communications Research (ASCoR). Kloveniersburgwal 48, 1012 CX Amsterdam, The Netherlands. http://www.leydesdorff.net/ Leydesdorf, L. (2002b). Some Epistemological Implications of Semiosis in the Social Domain. University of Amsterdam. Amsterdam School of Communications Research (ASCoR). Kloveniersburgwal 48, 1012 CX Amsterdam, The Netherlands. http://www.leydesdorff.net/ Maturana, H. & Varela, F. (1987). The Tree of Knowledge: The Biological Roots of Human Understanding. Boston: New Library Science. Mingers, J. (2001). Embodying information systems: the contribution of phenomenology. Information and Organization, 11, 103-128. Mingers, J. (2002). Initial Ideas Concerning ICTs and Human Communications. Black Group. SISN, University of Lincoln. Mitchell Waldrop, M. (1993). Complexity: The emergence of science at the edge of order and chaos. London, Viking Mitleton-Kelly, E. & N. A. Subhan (2002). Experiencing Complexity Thinking in Practice. The Humberside TEC Story. Complexity Research Programme. London School of Economics and Political Science, Houghton Street, London WC2A 2AE
Reyes, A. (2002). ICTs and Modeling: Some Current Challenges from a Constructivist Approach. SISN, University of Lincoln Senge, P.M. (1992). The Fifth Discipline. The Art and Practice of the Learning Organization. London: Century Business. Stewart, N. (2002). The example of organisational change in a major International corporation. Draft Report for Yellow Group, SISN (http://itsy.co.uk/sisn/), University of Lincoln. Von Foerster, H. (1984). Observing Systems (second edition). Seaside, California, Intersystems Publications. Zeeuw, G. de (1997). Second Order Organisational Research, in J. Achterbergh, R. Espejo, H. Regtering, M. Schwaninger Organizational Cybernetics, Research Memorandum, Catholic University of Nijmegen, Nijmegen, September, 1997 Zeeuw, G. de (1998) Inquiry into the Nature of Support, in van Dijkum, C, Zeeuw, G de and Glanville, R (eds.) Methodological Explorations in Constructive Realism, Southsea and Amsterdam, BKS+ Zeeuw, G. de (2002). History Mining. Brown Report, SISN (http://itsy.co.uk/sisn/), University of Lincoln.
