Organisations and the concept of systems

The comments on Chris’ last post refer to a dominant view of organisations and an alternative view presented by the notion of organisations as complex responsive processes. Questions arise as to whether one replaces the other or whether one can have both. In thinking about this we need to consider what the differences are. Mainstream thinking about organisations assumes that they either are or could most usefully be thought of as if they were systems.
I think there are a number of reasons for claiming that it is not helpful to think of organisations as systems – the claim is not that all forms of systems thinking everywhere are useless, as developed below but that it is not helpful to think of an organisation as organisation in terms of a system. The reasons are:

1 To think in terms of system is to think in terms of formative causality which cannot encompass novelty or creativity – a system unfolds the pattern already enfolded in its design, unless it is a system consists of diverse agents which give it the capacity to evolve. Most writing on organisations does not consider the last named and the practical difficulty is that the evolving system model of an evolving reality takes on a life of its own which will rapidly diverge from the evolving reality.
2 A system is a whole separated by a boundary from an environment and consisting of parts interacting to form the whole and themselves. A part is a part only in so far as it is necessary for constituting the whole. This means that if you think of a human being as a part of a system you are excluding from your theory of human agency all that is truly human such as the capacity for some degree of choice and spontaneity.
3 The conceptual act of separating a system from an environment or a context is an act of creating an inside of the system and an outside of the system. This immediately implies an observer. Indeed this is a central concept in all the serious systems thinking I have ever come across. The position of the observer as being outside the system was really recognised by Bateson as problematic and second order system thinking attempted to widen the boundary to incorporate the observer. However, as Bateson recognised, this led to infinite regress. Systems thinkers who recognise the problem of infinite regress use the ‘in practice it does not matter’ rhetoric to dismiss the point.
4 There is a strong tendency to reify a system and talk about ‘it’ having a direction, plans and so on. This is an abstraction from the ongoing experience of interacting people who are the organisation. It is striking how absent ordinary human beings are from discussions of the organisation as a system.
As already mentioned, the above argument is not an argument against all notions of system. In my latest book I set out the sense in which I am arguing against the notion of system. The following are some relevant paragraphs.

I want to clarify what notion of system in the dominant discourse is being departed from in the theory of complex responsive processes. To make this clear consider the different ways in which the word system can be used as:

1. a coherent, systematic whole of thought. For example, Hegel (1807) referred to his philosophy of the nature of thought and of the historical and social development of humans as his system;
2. a regulative idea or hypothesis about the nature of the development of phenomena in nature. For example, Kant (1790) held that it was useful to think of living phenomena as if they were wholes formed by interacting parts to develop a mature form of that nature already present at their inception. He held that this way of thinking could not be applied to human action because human actors are rational, autonomous individuals who cannot therefore be subject to, a part of, any system without losing their rational autonomy, their very selves;
3. a particular kind of conceptual model as in first order, hard systems thinking with its general systems theory, cybernetic and systems dynamics models of human groupings as systems which came to be regarded as actually existing. Individuals came to be understood as parts of organizational and social systems;
4. a way of thinking about individual mind as information processing devices. For example, cognitivist psychology is very much based on this systemic idea of the autonomous individual.
5. a way of thinking about human communication as a cybernetic system of transmission consisting of senders and receivers, both being autonomous individuals.
6. a living system. For example, Senge (1990) and Burke (2008/1982) both prescribe thinking about an organization as a system that is actually living;
7. a particular kind of conceptual model as in second order, soft, and critical systems thinking where the systems model is understood to be in the mind of the observer who thinks of organizations as if they were systems;
8. a complex system, the subject matter of Part 2 of this book, in which self organization at the level of the agents produces emergent order at the global level;
9. a tool or technique specifying rational sequential steps which observers and decision makers should use to structure and shape the problem situations facing them, find rational solutions and make rational decisions. I have in mind here the aspects of soft and critical systems thinking that focus attention on tools and techniques for rational problem solving by free agents, rather than thinking of organizations ‘as’ if they were systems. For example, these tools are prescribed for use by facilitators to facilitate rational discussion by groups of stakeholders to identity a plurality of ways in which problem situations can be understood as if they were systems;
10. a bureaucracy and hierarchy, that is as a comprehensive, interlocking set of procedures and actions. For example there are accounting systems, quality assurance systems, legal systems, property systems, health systems and transport systems.

When I refer to systems thinking I am referring to meanings 3, 6, 7 and 8 which, although each is different to some extent, together present a way of thinking about the nature of an organization as a system that is now completely taken for granted in the dominant discourse. I am identifying systems thinking with a particularly way of positing or thinking about an organization as an organization. I also include meanings 4 and 5 which provide compatible theories of the mental functioning of individual humans and the way they communicate. Meanings 3 to 8 have a number of important features in common. They provide coherent ways of modelling organizations as whole, global phenomena, which enable powerful members at an organization’s centre to ‘read’ the situation at the macro level across the whole organization and make decisions in a rational manner, so ensuring some form of central control. However, all models regard human beings as agents in, or parts of a system which are simplifications taking the form of averages, probabilities and regularities. Such simplifications remove difference and abstract from the detail of contingent situations and the complex detail of local interactions, which indeed are made rationally invisible by the focusing of attention on the abstraction. This is true even of the models found in the complexity sciences (meaning  8 which do introduce diversity and difference to model complex evolution but cannot model the detail of ordinary human interaction. They all regard rational, cognizing individuals as parts of the organizational whole. Process is understood as the interaction between parts to form the whole which is then often thought of as exerting downward causal forces on the individuals. They all involve a split between observer and organization, between problem and solution, between sender and receiver, and between decision and outcome. They all constitute abstractions which draw attention away from immersing in the local interaction of ordinary daily life in organizations. I will be exploring a way of thinking about organizations which does not appeal in any way to an understanding of organization as a system with human parts but rather thinks of organization as ongoing local interactions of an ordinary kind in which population-wide patterns of organizing emerge. The objection is to thinking about human beings in abstract ways as parts of a system split off from ordinary experience.

Meaning 1, a system of thought, and meaning 2, a hypothesis about systems in the natural sciences, are not meanings with which I am concerned when discussing organizations. When I refer to systems thinking I am also not referring to meaning 10 about hierarchy and bureaucracy since they are formal patterns of relationships and explicit generalized procedures which are unavoidable in organisations. While the concept of system contained in all of the meanings 3 to 8 has come to occupy a dominant place in the conceptualization of the nature of organization, this has not been accompanied, perhaps surprisingly, by the widespread use of the tools and techniques (meaning 9) developed by communities of systems thinkers in academia and the consulting world. At a recent conference of such practitioners in the UK, they were asked to vote on the importance of their offerings and their conclusion was that while their work had not had zero impact it also had not spread widely to become a method of making decisions and solving problems, despite its claims to rationality. People in organizations do not normally follow the steps proposed by systems practitioners nor do they follow ‘rational’ decision making where rational is understood in a technical way. Instead the organizational reality is that they engage in daily conversation, gossip, political negotiations, power plays, acts of resistance and pursuit of personal agendas: in short local interaction. And the powerful are hardly likely to enthusiastically back the use of techniques reflecting and ideology of freedom, democracy and emancipation of the people from oppression. Perhaps those presenting the techniques are not taking enough account of the patterns of power relations. However, systemic tools and techniques are often used on special occasions such as strategy ‘away days’ or when large numbers are involved in highly visible problems. On these special occasions the tools and techniques (meaning 9) may be useful when they stimulate conversation, local interaction. In moving away from systems thinking I am therefore not claiming that all the tools and techniques for promoting discussion should be dispensed with, although in my view they do run the risk of getting thought stuck at the abstract level of systems which avoids reflection on the messy reality of local interaction.

Although I am interested in a developing a way of thinking which avoids thinking about organisations as if they were systems, I am not at all dismissive of using the notion of a system as a tool for approaching some specific problems. For example, systems thinking can be very fruitfully used to design flows of work. The system here is a tool that people use in their communicative interaction as a way of co-coordinating and accomplishing their work. In this view of system, the agent, the part of the system, is an activity not a person. For example, although Seddon very occasionally refers to the organization as a system, he devotes most of his book to understanding the system as the way work is designed and managed and holds that this system governs performance. So he sees customers and the organization’s staff using the system to do their work. He distinguishes between value work, meeting the needs of the customer and failure work which is created when customers complain about the failure to meet their needs. He shows how one system design, one based on targets which are always arbitrary numbers, produces increasing levels of failure work. The design problem is to re-design the system to reduce failure work and focus on value work. Instead of targets, which he says should be scrapped, he measures the actual meeting of customer needs. Attending to this can lead to a failure to meet the targets but satisfy the customers. Managing by targets leads to achieving the targets but failing the customers. We have here a system – the parts are tasks interacting with each other to produce the whole task of the organization and performance; there is a boundary as customer demand flows in from outside the task system and customer service flows out. This is a very effective way of thinking about a largely predictable but nevertheless highly variable work.

So I am not arguing against thinking of work flows as designed systems – to think like this brings a great improvement over ways of thinking that fail to see linkages. I am arguing against thinking of the organization, as organization, consisting of individual people as parts that produce the whole called the organization. I am arguing that an organization is an evolving pattern of interaction, of activity between people and they very frequently employ tools to accomplish this interaction – tools which they design and the design of which can provide a greatly improved understanding of the way tasks are connected as a system to produce purpose. But people are not a system – people employ a system in their action. This is important because otherwise we tend to focus on the tool and ignore the people. Seddon shows clearly how the current system of organizing work generates cheating. So he is taking account of the people, staff and customers, but does not write about them as being parts of a system, although this may well be what he thinks. For Seddon taking a systems approach involves managers seeing work flows as a system. He says they need to think in flow terms of what is flowing from the outside into the system. This means starting with a study of demand to see what is working for customers now, for example, why customers call a local authority. Many work flow designs separate front and back offices (parts) and so involve transferring pieces of work from one to another. The call comes into the front office and dealt with by the back office. Seddon says this design blocks and slows down work flow. I think all of this is certainly very helpful. I am therefore not particularly engaged in a critique of system meanings 9 and 10.

It is the forms 3 to 8, which include theories of communication and the autonomous individuals, that I want to characterize as systems thinking and challenge this by suggesting an alternative complex responsive processes way of thinking. It is interesting to see how a number of people  capitalise the complex responsive process of human beings relating to each other as CRP. This immediately creates the potential for reification – I am referring to ongoing, never-ending interactions between human bodies over time and by capitalising these processes as CRP one ise in effect abstracting the ‘interaction’ from the bodies interacting and implicitly ascribing a kind of separate existence to the ‘interaction’ which it is then easy to describe as a thing. It is then difficult to see CRP as different to a ‘system’.

4 thoughts on “Organisations and the concept of systems

  1. Musah Mohammed

    Dear Professor,

    Thank you very much for these propositions. I am currently reading your book, strategic management and organisational dynamics; the Challenge of Complexity.

    The paradox I am faced with is that I am being convinced by an alternative way of thinking about reality from Complex Responsive Processes point of view which I find very pragmatic and how i fit into the dominant discourse out there after my MBA training.

    1. ralphstacey Post author

      Dear Musah Mohammed

      That is indeed a central problem faced by all who seek to shift how they think

      Regards Ralph

      Professor Ralph Stacey Complexity Research Group Business School University of Hertfordhire Hatfield

  2. Rotkapchen

    I also have a problem with people who try to debunk a theory using old paradigms.

    A process is either an operating algorithm or is binary code (depending on how many variables are accommodated). Process is great for situations where variability is low. Add a human being to the mix and variability goes up exponentially.

    There are no processes in the realm of heuristics — workflows become adaptive flows of work, defined by metadata rather than binary code or algorithms.

    That’s not to say that process doesn’t have its place, but it’s only a portion of the picture. CRP, to me (I won’t say what it ‘looks’ like) is a band-aid for a flawed way of seeing the problem space to begin with. It’s the language of the “horseless carriage”.


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