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The author discusses the ways in which complexity thinking can have a positive impact on the management of organizations.
This article is an attempt to explore the implications of the emerging science of complex- ity for the management of orga- nizations. The general message is that there is no one way to manage and that management is as much an art as it is a science (which in itself is not a par- ticularly original statement). In a sense, complexity thinking is about the limits to what we can know about our organi- zations. And if there are limits to what we can know, then there are of course limits to what we can achieve in a pre- determined, planned way. Complexity thinking offers us a rigorous and scien- tific explanation as to why we are to some degree helpless, and also provides some tools for thought that help us manage our inevitable shortcomings and limita- tions. In a way, accepting that we have lim- itations and can never have complete control is rather emancipating. Com- plexity thinking is about the middle ground between extremes, and so although managers are to a degree helpless and at the mercy of the "system," it certainly does not follow that there are not opportunities to affect organizational behavior in desirable, semiplanned ways.
This article is intended for financial managers but of course its views and conclusions can be applied across a broad spectrum of management functions. The problems of complexity and complication are particularly felt by financial managers in the current environment.
Complicated vs. complex
If human organizations were merely complicated as opposed to complex, the possibility of an all-embracing theory of management would almost certainly exist. There would be a book of theory, called, say, The Management Bible, that would tell the practicing manager what to do in any given context. The means of achieving effective and efficient organizational management would no longer be a mystery. But the fact that organizations are complex rather than complicated denies us of this possibility.
A very common (but incomplete) description of a complex system is that such systems are made up of a large number of nonlinearly1 interacting parts. A computer is full of transistors that respond nonlinearly...