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Adaptive Systems Within a Company’s Approach to Strategic Management

Autor:   •  June 1, 2018  •  3,144 Words (13 Pages)  •  606 Views

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Organisations as complex systems makes us understand why there is no independent decision or policy that affects just one aspect of the organisation. Individuals working in the organisation also have other aspects to their lives besides the organisation. These may be family-life, social life, health, education and other aspects that affect their role at work. When there are misunderstanding at home, a teacher may come to school angry and might unleash this anger on the students. A nurse might maltreat her patients because she is being maltreated at home and the list of examples goes on and on.

There is no single agreed upon theory of complexity. However, there are several theories arising from various studies on complex systems. These include theories undertaken by Chris Langton and Murray Gell-Mann on complex adaptive systems, Prigogine on dissipative structures (Prigogine & Stengers 1985, Nicolis & Prigogine 1989, Prigogine 1990), among others. Nicolis and Prigogine (1989, p8) suggested that “it is more natural, or at least less ambiguous, to speak of complex behaviour rather than complex systems. This suggests that in studying complex behaviour, it is easier to understand complex systems. There are several concepts relating to complexity. These include: Connectivity and interdependence, Co-evolution, Far from equilibrium and dissipative structures, Feedback, Increasing returns and unpredictability, Chaos and complexity, Emergence and Exploration of the space of possibilities, Enabling infrastructures, knowledge and leadership. A few of these concepts explained below.

Connectivity and interdependence arise because of the inter-relations existing within systems. Gell-Mann (1995/1996) identified that the word complexity comes from the Latin work plexus which means entwined or braided. In a complex system or working environment, any improvement or change that occurs in one sector has associate implications on other sectors that usually cannot be predicted. In a quest to adapt and evolve, new orders created lead to further complexity and increased ripple effects.

The notion of co-evolution emphasises that in a human system, there are external influences that can create varying forms of complexity. In any ecosystem, the evolution of one domain or entity is partially dependent on the evolution of other related domains or entities. Kauffman and Macready (1995). The social ecosystem comprises of other businesses, customers, culture, national and international policies, the economy, as well as other external influences. In strategy formulation therefore, there is the need for the inclusion of adaptive systems that can be used in times of co-evolution to aid in the achievement of overall company goals and objectives.

Emergence as Valera & Maturana (1995) describe it, is the transition from local rules or principles of interaction between individual components or agents, to global principles or states encompassing the entire collection of agents. They describe emergence as a self-organising phenomena and the emphasis of emerging patterns and structures that arise from interaction with individual elements.

These concepts gives us a broader perspective on how complex organisations are and how every little change, interaction, emergence, leadership etc., affect overall achievement of organisational goals. It however also makes us understand that strategic planning can be the means of dealing with any type of complexity that organisations face if the right approach is used.

COMPLEX ADAPTIVE SYSTEMS IN PRACTICE

With the above concepts of complexity, it is necessary that complex adaptive systems are put together as strategies in helping the organisation realise its overall goals and objectives by preparing for complexities that arise per systems and the various actors of the organisation. As organizations become more and more complex on daily basis per the structures, interconnectivity and interdependences, adaptive systems are the best ways to deal with these complexities and use them to the advantage of the business so there is increased productivity. Some emerging complex adaptive systems in practice are as follows:

Viewing of organizational systems as complex rather than as some machine or military organization (unless of course, it is one). When organizations are viewed and expected to run as machines, it ignores the fact that there is the individuality of agents and their interactions can cause unpredicted actions on the company. Whereas viewing of organizations as complex systems helps with the creation and implementation of complex adaptive systems that work out best for the actors as well as the organization as a whole.

Most organizations are now striving to build good long term visions rather than planning out every detail of the strategy. Instead of putting together long complicated policies, it is better to create simple policies that gives the general direction the organization wants to go and some guidelines on how to go about it. These kind of systems gives room for flexibility for the actors to operate in their own scope whiles still achieving organizational objectives.

Theoretically, complex adaptive systems suggest that there should be just the right amount of information flow in order for self-organization to occur. When there is too much or too little information flow, the best outcomes may not be achieved. In practice however, how does one determine what the “right amount” of information is? It is about having the right mental model and trying out various factors and to determine which works out best eventually.

In the list of emerging systems discussed, it is clear to see that balance is key when it comes to Complex adaptive systems. There is also the greater need for balance among organizations, and their competitors and as stated by Waldrop (1992), “competition can produce a very strong incentive for cooperation, as certain players forge alliances and symbiotic relationships with each other for mutual support”

In practice, there is the growing realization that effective strategy formulation as well as implementation are key factors for a successful business. However, as cited in (CIMA 2007), a survey carried out by Deloitte in 2006 on over 120 senior executives indicated that poor execution of strategies led to unachievable organizational goals. Only about 3% of companies researched by the America Management Association (AMA) on over 1500 executives were successful at implementing corporate strategies.

Strategies do not always go as planned. Sometimes this is because the strategies within a given organization act against each other rather that together to achieve a desired common

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