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Social Organizations with Complexity Theory: A Dramatically Different Lens for the Knowledge Economy

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Encyclopedia of Complexity and Systems Science

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Definition of the Subject

Complexity theory for organizations examines the influence of complex dynamics on (among many things) organizational structure, leadership, powerand control, influence, and strategy. It is applicable not only to understanding but of practice in any organizational type whoseprimary commodity is knowledge and application of knowledge. The core outcomes of complex dynamics are creativity, adaptability, and learning. Complexitytheory is particularly germane in what has come to be called, the knowledge economy.

This paper defines basic premises underlying complex dynamics in organizations, and argues in particular that organizational complexity is bestunderstood as the interactions among complexity mechanisms (causal process attributable to dynamic interactions among multiple people, variables, ideas,etc.) rather than as the outcome of defined variables. We explore the relationship between bureaucracy and complexity, and define three levels of behaviorin complex...

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Abbreviations

Glossary:

Many of these terms are commonly understood by complexity theorists; these definitions, however, describe their meaning within the context of social organizations.

Adaptive behaviors:

Perturbations (creative ideas, pressures, etc.) in a system that foster some observable level of phase transition. Change leading to systemic reaction.

Adaptive tension:

Pressures external or internal to the organization that perturb an organization thus pressuring it toward phase transitions and structural or ideational elaboration.

Administrative leadership:

behaviors related to such things as strategic planning, policy making, and resource acquisition and distribution.

Agent:

An entity that is the smallest unit of interest in a complex dynamic. An agent could be a person, idea, task, knowledge, etc.

Aggregation:

Coevolutionary emergence of diverse ideas, agents, etc.

Aggregation mechanisms:

Macro-level complexity mechanisms. Refers to the dynamic interactions of perturbations (see initiating mechanisms), amplifications (expansion and elaboration of a perturbed state), and phase transition (nonlinear, form-shift in some part of an organization).

Coevolution:

A process in which “reciprocal selective pressures operate to make the evolution of … (one agent in an interactive process) partially dependent on the evolution of (other agents)” [67]. Coevolution occurs when heterogeneous agents in a niche are interdependent such that they dynamically adjust to each others changes.

Commodity-based economy:

Refers to a manufacturing economy in which the major assets are physical commodities.

Complexity organizational knowledge:

Systemic knowledge that imbues organization with capacity for adaptive and creative responses; attributable to the strength and viability of the system's complex structures and to the viability of the relationship between the organization's complex structures and its bureaucratic structures.

Complexity mechanism:

Social mechanisms that underlie complexity dynamics.

Complexity theory:

In organizational sciences, the study of emergent dynamics in neural‐like networks of adaptive, vision‐oriented agents.

Conflicting constraints:

Conflict that emerges when the preferences of one agent challenges the preferences of another. In complex networks, conflicting constraints generate pressure to elaborate.

Dissipative structures:

Structures that emerge when far from equilibrium systems release excess energy in a phase transition.

Emergence:

The appearance of new structures or ideas from the actions of complex interactions.

Enabling behaviors:

Activities that foster conditions (e. g., interdependency, enabling rules, adaptive tension) in which complex dynamics can emerge.

Enabling rules:

Rules that govern interactions among adaptive agents in complex systems. Contrast with bureaucratic rules, which delimit the responsibilities of agents in a closed system bureaucracy.

Entanglement:

A dynamic relationship between the formal administrative forces and informal complexly adaptive, emergent forces of an organizational systems.

Equilibrium:

A stable, predictable relationship among agents and structures of a relationship. Related to thermodynamic concept of a low energy state.

Extreme event:

Instances of dramatic change that occur infrequently in social organizations; the US government's experience of the Katrina hurricane in NewOrleans illustrates. Extreme events typically require rapid action andcan be minimally responsive to top-down control.

Far from equilibrium:

Typically defined as a high energy state; defined here for organizational studies as an intensely complex, dynamic state driven by excess levels of pressure and perturbations.

Heterogeneity:

A diversity of skills, worldviews, preferences, beliefs, goals, (etc.) among interactive agents in a complex system.

Initiating mechanisms:

Micro-level complexity mechanisms. They include coevolutionary interaction and perturbations (an unexpected change in an interaction relationship; attributable to complex, interactive dynamic).

Interdependency:

Network conditions in which the actions of one agent are influenced by the actions of another.

Knowledge economy:

Refers to a production economy in which the major assets are the knowledge possessed by individuals and networks of individuals (organizational knowledge).

Meso theory:

Variously defined as theory that bridges macro and micro level theory; different levels of hierarchy; or different levels of analysis (individual, dyadic, group).

Multi-agent based modeling:

Agent based modeling procedure that analyzes different types of networks simultaneously (e. g., agent networks, task networks, etc.)

Organizational level:

From Jaques [40], the level of bureaucracy that lies between the upper echelon levels and the work production level; includes middle management.

Perturbations:

Events that disturb normal organizational interactions and generate pressures that can lead to phase transitions.

Phase transition:

Sudden, nonlinear form shifts attributable to the dissipation of accumulated pressure in complex systems. Phase transitions can occur at multiple levels of intensity.

Postmodernism:

In general, a rejection of scientific modernism. For organizational science, it represents a realization that organizational behaviors cannot be adequately expressed as mathematical relationships among variables. Complexity theory adds that organization is an ultimately unpredictable dynamic whose causal structure is based on interactions among complexity mechanisms.

Production level:

From Jaques [40], the level of bureaucracy responsible for line production.

Requisite complexity:

McKelvey and Boisot's [65] modification of Ashby's requisite variety; they maintain that viable organizations are at least as complex as their competition.

Requisite variety:

Ashby's [5] dictum that viable organizations have at least the same degree of flexibility as their competition.

Spaces between:

A proposal that creative ideas emerge from interactive dynamics. Creative emergence is generated when agents work to resolve tension; such tension is product of conflicting constraints, heterogeneous preferences, ideas, and knowledge, etc.

Social mechanism:

A process attributable to dynamic interactions among multiple people, variables, ideas, physical limitations, etc. Mechanisms describe “a set of interacting parts – an assembly of elements producing an effect not inherent in any one of them” p. 336 in [27], p. 74 in [37].

Strategic level:

From Jaques [40], the upper echelon level of bureaucracy; responsible for organizational strategy, policy making, resource acquisition and allocation, etc.

Swarm behavior:

Study of the dynamics of swarms in biology and in organizations. Scientists are finding that amazingly complex, “intelligent” behavior can emerge from complex behaviors that are structured by a few, simple enabling rules. Useful in organizations for improving such things as distribution efficiency or flexible response to environmental conditions.

System dynamics:

Network simulations in which relationships among agents are defined mathematically.

Top-down administration:

Administrative practices in which decisions are made by superiors to be carried out by subordinates.

Vision:

A teleological view of the future. Vision can be highly specific, or determinate, as when an organization projects future markets (such visions are more properly, goals; see Sharp Corp.'s strategy statement in this paper for an example). Vision statements appropriate for complex systems are indeterminate in that they do not preclude the future; for example, “This company will strive to enhance its competitive advantage by optimizing its flexibility.”

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  1. Clemson University, Clemson, USA

    Russ Marion

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  1. RAMTECH LIMITED, 122 Escalle Lane, Larkspur, CA, 94939, USA

    Robert A. Meyers Ph. D. (Editor-in-Chief) (Editor-in-Chief)

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Marion, R. (2009). Social Organizations with Complexity Theory: A Dramatically Different Lens for the Knowledge Economy. In: Meyers, R. (eds) Encyclopedia of Complexity and Systems Science. Springer, New York, NY. https://doi.org/10.1007/978-0-387-30440-3_497

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