lecture 6 complexity

7/27/2019 Lecture 6 complexity

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6. Forelsning d. 7. oktober 2013

Strategisk ledelse


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Lectures, autumn 2013

Week Date Subject Literature

35 26. Aug Introduction to the course N/A

36 2. Sep Introduction + Thinking about strategy Stacey #1 + 2

37 9. Sep Thinking in terms of strategic choice Stacey #3

38 16. Sep Introducing mini projects and forming groups N/A

39 23. Sep Cybernetic systems, Cognitivist and humanistic psychology Stacey #4 - 4.3

40 30. Sep Cancelled

41 7. Oct Cognitivist and humanistic psychology + Complexity sciences Stacey #4.4 4.8

42 Autumn vacation

43 21. Oct The interplay of intentions + CRP of conversation Stacey #12 + 13

44 28. Oct Interaction of strategising and patterns of strategy Stacey #14

45 4. Nov Complex responsive processes of ideology and power relating Stacey #15

46 11. Nov Modes of articulating patterns of interaction Stacey #16

47 18. Nov Complex Responsive Processes of strategising Stacey #17

48 25. Nov Complex Responsive Processes Stacey #18

49 2. Dec Wrap up Mini projects N/A

51 16. Dec Hand in of mini projects no later than 14:00 N/A


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Cognitivist and humanistic psychology

Sender-Receiver model

Initially, the human brain was thought of as adeductive computer, performing logic operations

Intelligence was equaled with computation, socognition (human knowing) could be understood as aprocess of computing representations of reality

Learning is when the pre-given reality is more andmore accurate represented by negative feed-back

Emphasis on internal representation of externalenvironment and learning by negative feed-back

Sender-Receiver model of communications

The human mind becomes one of the variables that

can be designed and changed as cybernetic systems


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Humanistic psychology

Takes an optimistic view on human nature

Alienation of the true self because of

revivalism

Focus on human motivation, values, beliefs

and the importance of leadership vs. rational

decisions

Sharing culture and formulating a common

vision, which still is at the core of cybernetics

theory


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Humanistic psychology - motivation

Herzberg Maslow Schein / Etzioni Pascale / Athos

Extrinsic motivators:

Monetary rewards

Intrinsic motivators:

Recognition for

achievement

Achievement itself

Responsibility

Growth and

advancement

Basic Physiological

needs:

Food and Shelter

Intermediate social

needs Safety

Esteem

Higher self -

actualization needs:

Self Fulfillment

Relation: individual /

organization

Coercive:

Only do bare minimum toavoid punishment

Utilitarian:

Do only enough to earn

required reward

Normative:

Value what is being done for

own sake, because the

individual is believing and

identifying with it

People are yearning for

meaning in their lives and

transcendence over

mundane things.

Cultures that provides this

meaning are able to create

powerfully motivated

employees and managers


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Humanistic psychology

Mission statements (believing in what is beingdone) captures emotional support fromemployees and thereby paves the way for

motivated employees Vision: picture of future state

Mission: a way of behaving

Organizations will be successful when peopleare emotionally engaged and inspired byvisions and a sense of a mission and it is therole of leaders to choose these


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Leadership / Groups

Leader translates higher level directives to goals andtasks for his/her part of the organization, monitorsperformance and ensures motivated employees

Two basic leader styles; autocratic / delegating

Leadership style applied is context dependant

Formal groups requires psychological awareness, cleargoals, tasks and their purpose is to solve problems

Informal groups may develop, primarily driven byphysical proximity and nothierarchal relation

Such informal groups may jeopardize motivation,control systems and other formal structures


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Strategic Choice Theory

Key questions:

Strategy determines structure or vice versa?

Market position or resource base determines

competitive advantage?

Limits to strategic choice, particular when itcomes to uncertainty and the impact of

cognitive frames in interpreting situations. Process versus content leading to an

emphasis on learning rather than simplechoice


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Complexity Sciences


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The complexity sciences

All ideas in section 1 (chapter 1-9) is importedfrom natural sciences and complexity theories

could present significant challenges to this

way of thinking

The complexity sciences will establish the

transition from section 1 to section 3 of the

textbook

Strategic

Choice

Theory

Transition

Complex

Responsive

Processes


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Chaos theory

Chaos theory is not to be regarded as utter confusion! It is an extension of systems dynamics and focuses on

the phenomenon is changing over time

The model is iterated over time, which means that

calculated output of one period is taken as input forthe next calculation and identifies dynamicalproperties

In system dynamics, a model can, at one point, display

an equilibrium. In chaos theory, the Point Attractorsettles for such an equilibrium.

At other points, the model displays perfectly stableand predictable cycles of movement which is referredto as Cyclical or Period two, attractor


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Chaos theory

The highly unstable behavior, for certain parametervalues, of system dynamics is referred to as high-dimensional chaos a pattern of fragmentation

Between stable parameter values (point or cyclical)and unstable values (chaos) the system moves in amanner that seems random, but displays a pattern

The pattern is regular irregularity or stable instabilitywhich means it is predictably unpredictable

Paradoxical pattern of movement; Strange attractor,which is referred to as Mathematical Chaos and is acompletely differently dynamic where stability andinstability is inextricably intertwined


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Chaos theory

High sensitivity to initial conditions and even tinydifferences in the input of one period canescalate so that patterns change qualitatively inlater periods

Long-term predictions is therefore impossible!

Weather systems actually follows a StrangeAttractor and can be visualized as the ButterflyEffect

Short-term predictions are possible, because ittakes time for tiny differences to escalate

Impossible to identify specific causes theproduces specific outcomes, but boundaries andthe nature of the patterns are known


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Chaos theory

Chaos theories do not have the internalcapacity to move spontaneously moves from

attractor to another, this requires an external

force for parameter change

Causality continues to be formative and chaos

models are unfolding the pattern already

enfolded in its mathematical specification

Incapable of spontaneously generating

novelty


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Dissipative Structures

Based on demonstrations that shows howphysical and chemical systems displaysunpredictable forms of behavior when farfrom equilibrium

Systems may reach critical points where theyself-organize to produce a different structureor behavior that cannot be predicted from

knowledge of the previous state This more complex structure is called

Dissipative Structures because it takes energyto sustain that new mode


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Example with thermodynamics

Closed to environment and temperature uniform

At a state of rest on global level (no bulk movements)

Movements of molecules are random and independent

System behavior is symmetrical, uniform and regular

When heat is applied, the liquid is pushed far from its equilibrium

and small fluctuations are amplified throughout the liquid

Temperature change at the base is amplified or spread through the

liquid. Molecules start to move upward

Established convection so molecules least affected are displacedand moved down to the base

The molecules are now moving in a circle

At a certain temperature point, the molecules start setting up

hexagonal cells and turning both ways

The cells are self-organizing in a non-predictable way!


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When the water boils, a state of deterministic chaos In nature, as opposed to laboratory experiments,

parameters are changed by nature itself.

Self-organization is a process that occursspontaneously at certain critical system values

Such spontaneously moves to different attractors, onlyemerges when impacted from the environment

The dissipative structure dissolves easily if the systemmoves away from critical parameter values

Equlibirum structure:

- No effort to retain structure

- Great effort to change structure

Dissipative structure:

- Great effort to retain structure

- Little effort to change structure


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A wider implication of these identifications could bewhether the future is given, or is it under perpetual

construction?

Prigogine: Nature is about the creation of

unpredictable novelty, where the possible is richerthan the real

Life is a unstable system with an unknowable future

in which the irreversibility of time plays aconstitutive role


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If these theories were to be applied to an organization,then decision making processes that involved;

Forecasting

Envisioning future states

Making key assumptions about future states

.. would be problematic in terms of realizing a chosenfuture. Those applying such processes in conditions ofstable instability would be engaging in fantasyactivities

No one can establish how the system would movebefore a policy change and how it would move afterthe policy change. There would be no option, but tomake the change and see what happens


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Complex Adaptive Systems

CAS is characterized by a large number ofagents, each of which behaving to some set of rules.

These rules requires each agent to adjust its action tothat of other agents and hence forming a systemwhich also could be thought of as a population-wide

pattern Examples of Complex Adaptive Systems;

Bird flocking, where individual agents who might befollowing simple rules to do with adaption to themovement of neighbours so as to fly in formation without

colliding The human body, consisting of 30.000 individual genes

interacting with each other to produce human physiology

An ecology with a number of species relating to eachother to produce patterns of evolving life forms


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Complexity sciences seeks to identify commonfeatures of the dynamics of the example systems ingeneral

How do such complex non-linear systems function toproduce orderly patterns across a population?

The expectation, when using traditionally sciences, forstudying such phenomena's would be to identify lawsgoverning evolution or blue-prints for the system

Scientists working with CAS take a fundamentallydifferent approach:

they model individual agent interaction with each agentbehaving to its own local principles of interaction


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This leads to the principle of self-organization, agentsinteracts locally according to their own principles inthe absence of an overall blueprint for the system theyform

Self-organization and emergence can lead tofundamental structural development (novelty), notjust superficial change

This is Spontaneous orAutonomous events, arisingfrom the intrinsic iterative nonlinear nature of thesystem

The inherent order in a CAS which evolves as theexperience of the system, but no one can know whatthat evolutionary experience will be until it occurs


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Fitness Landscapes gives insight in evolutionaryprocess, just as animals develops strategies tofeed and survive

To reach a peak means survival and to gettrapped in a valley means extinction

The peaks cannot beseen from lower levels

Moving upwardsthrough logicallyincremental strategymay fail due to missingcross-replication


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Summary and perspective

Introduction to;

Chaos theory

Dissipative structures

Complex Adaptive Systems A number of writers has been using these

theories applied on organizations, however;

System views of interaction retained

Cognitivist approach to human psychology

Prescription of the manager as the objective observer

Overall a re-representation of SCT


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Backup slides

Stacey Chapter 5


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Systems Dynamics

Nonlinearity and Positive feedback

Peter Senge is the father of Learning Organization

Learning requires people to think in systems terms, inorder to understand surroundings and leverage points

Based on nonlinearity and positive feedback

Nonlinearity occurs when some condition or actionhas varying effect on an outcome, depending on levels

System dynamics may display the possibility to display

non-equilibrium when flipping between +/- FB Cyclic behavior may occur and may be very irregular, if

dependant on environmental fluctuations

Important in understanding economic cycles and

certain applications to organizations


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Systems Dynamics

Principles of systems dynamics

Principles about Complex Human Systems: Complex systems often produces unexpected and

counterintuitive results

with nonlinear relationships, or with positive and negative

feedback, the links between cause and effect are distant intime and space

High sensitivity to some changes but remarkably insensitiveto many other changes and these systems contain someinfluential pressure, or leverage points

Managers can influence the system at these points, howeverthey are difficult to identify

Positive feedback (or regenerative feedback) occurs in a feedback loop when the mathematical sign of the net gain aroundthe feedback loop is positive. That is, positive feedback is in phase with the input, in the sense that it adds to make theinput larger. Positive feedback is a process in which the effects of a small disturbance on a system can include an increasein the magnitude of the perturbation


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Animation of complex systems dynamics

http://en.wikiped

ia.org/wiki/System_dynamics
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Systems Dynamics

Cognitivist Psychology

People who have personal mastery obtains the resultsthey want and it commits to lifelong learning and maybe linked to spiritual foundations

Mental models are internal pictures of the external

world. They are ingrained assumptions orgeneralisations often taking the form of pictures orimages in individual minds, which often are hidden orunconscious mental constructions

Management teams can change mental models and is

cognitivist psychology as in SCT, which claims thathumans are compelled to simplify everythingobserved

Managers are humans as well and inevitably invent, sosome extent, what they observe


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Systems Dynamics

Constructivist Psychology

In Constructivist Psychology, people do not simplyrespond to stimuli about what is already there

Rather, they select aspects of their environmentaccording to their own identities and therefore

enacting the environment relevant to them

This is active cognition (recognising and responding)rather than passive (what is already there)

Constructivist viewpoint because the world people act

into is the world they have created by acting into it

The shift in psychological model challenges SCT,however still focus on systems and individuals


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Systems Dynamics

Enactment and sensemaking

Stimuli are placed in a framework so that they cancomprehend, explain, extrapolate and predict

Individuals form conscious and unconsciousanticipations of what they expect to encounter.

Sense- making is triggered encounters are different. The need for explanation is triggered by surprises and

meaning is ascribed retrospectively

Sense making is the process people employ to copewith interruptions of ongoing activity

A distinction between collective and inter-subjective(individual-relating) forms of sense makig.

Storytelling places cues for making sensne

Novelty arises in dissonance, surprises, gaps etc.


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Systems Dynamics

Single and double loop learning

Single loop learning reuses previously acquired mentalmodels for automating actions as unconsciousprocesses

Risk of skilled incompetence because unconscious

models become taken for granted and requires stableenvironments

Double loop learning occurs when actions are adjustedin the light of their consequences and questioning and

adjusting the unconscious mental models used Possible difference between espoused and used

models

Managers often espouse rational models and at the

same time other models as games for deception


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Systems Dynamics

Single and double loop learning

When mental models are questioned in double looplearning, fears arise because of the possibility to failproducing functioning alternatives to old models

Defence routines or covert politics are activated,

may end out in bland mission and vision statements The organization loses out on the creativity of people

because of the management model it uses

Managers must reflect jointly on the process they are

engaged in, as a challenge, in order to be able toengage in double loop learning

Double loop learning is then changing a mental modelwhich again enables innovation

lecture 6 complexity

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