47th Annual Meeting of the International Society for the Systems Sciences (ISSS), Hersonissos, Crete, July 8, 2002.

July 8, 2003, 5:30 p.m.

This digest was created quickly, based on an audio recording of the meeting. This should not be viewed as official transcripts of the meeting, but only as an interpretation by a single individual. Lapses, grammatical errors, and typing mistakes may not have been corrected. Questions about content should be directed to individuals who were present at the meeting, or by referring to the audio record. These notes have been contributed by David Ing (daviding@systemicbusiness.org) at the IBM Advanced Business Institute ( http://www.ibm.com/abi ).

[David Ing as moderator]

Welcome to the second session of Special Integration Group on Systems Applications in Business and Industry

• Trying to enforce the idea of integration.
• Need to discuss something that each of us contributes a part, but is different from what each of us does individually.
• No formal presentations, no Powerpoint slides.
• Can use flip chart.
• Encourage dialogue, gain some knowledge from individual knowledge.
• Recording, and creating a digest.

First half, discussion on three papers:

• Organizational Forms and Evolutionary Paths
• Theme: Businesses, as social systems, undergo change both in deliberate and emergent modes. How much influence do we really have in collective social groups such as businesses? These three papers will lead us on a dialogue of whether human beings in social groups can really influence their directions in organizations.
• Annaleena Parhankangas and David Hawk, Mutual Development of Techologies and Governance: Reliance on Systemic Coincidence, Natural Luck or Strategic Planning?
  • Luck isn't something usually discussed in business.
  • Business executives uncomfortable with a message that the future is dependent on luck.
• Kazuyo Sekiguchi and Kyoko Kato, Job Satisfaction and Life Satisfaction of Female Graduates of a Japanese University
  • Can you plan out life satisfaction or job satisfaction, or is it just something that happens?
• Pavel Luksha, The Firm as a Self-Reproducing System
• Presentation for 2 to 5 minutes.

[05:00]

[Pavel Luksha arrived]

[05:50]

[Annaleena Parhankangas]

Followed the evolution of three technology-based ventures, initiated by Finnish corporations, followed them over almost three decades.

• New-to-the-world technologies, leading edge scientific discoveries.
• No market or product applications in the beginning.
• A special situation, but quite common for technology-based firms.
• Were paying attention to three questions:
  • 1. How do managers choose from various novel technologies?
  • 2. Why do these choose to develop these technologies, and product applications?
  • 3. How do managers choose how to govern these technologies?  In alliances, in-house, or joint ventures?

These questions are also addressed by the diversification literature, and theory of the firm (optimal boundaries of the firm).

• Not satisfied by these theories, as they don't take into account the special characteristics of technology and science-based industry.
• The studies usually take a short-term view, and don't observe over longer periods of time.
  • They have an over-emphasis on rationality and intentionality.
  • Seem to assume that managers know what they're doing.
  • They ignore luck, social environment, and systemic connections where technology development takes place.

Found out:

• When interviewing managers, reminded of Alice in Wonderland.
  • Alice asks the Cheshire cat, which way should I go?
    • Depends a great deal on where you want to go or where you want to get to?
    • Alice says doesn't much care.
    • Cat then says that it doesn't matter so much which way you go.
  • Basic message:  these corporations didn't have clear goals in the beginning of where they wanted to go.
  • The only knew that they wanted to develop new businesses, e.g. opportunities in biotechnologies.
• Some managers knew exactly what they wanted to do.
  • Ironically, they never achieved those goals, and achieved something else.

What triggered advancement in technology, e.g. finding new customers or potential applications, was triggered primarily by social contacts.

• e.g. knew someone in university or college working on a similar kind of project, and just decided to work together.
• Or was at the right place at the right time, e.g. meeting someone at a conference with similar interests, then creating a joint venture.

Seemed whenever there was an advancement in technology, there was a change in governance form.

• When decided on a product application, then joined with a complementary company.
  • Or figured out application, but decided not to be in that business.
• Seems necessary to break loose from the current organizational environment, to explore new things.
  • Crucial to cut loose from old networks to commercialize.
  • Avoiding the problems of organizational embeddedness.

Benefits to organizations, in finding new products areas

• Only got revenues from licensing activities or spin-offs.
• The other firms got benefits.
• All technologies were bases from new firms.
  • Was this a failure or a success, and whose perspective should we take?

[13:40]

[Kyoko]

Job satisfaction and life satisfaction of female graduates from a Japanese university.

• Same data set as yesterday's study on mentoring.
• First study was a narrower set.
• Second study compared men and women -- the same degree from the same university.
• Work status, but special because of life satisfaction and work satisfaction.

Found that life satisfaction for women was generally high, but job satisfaction for women was lower than for men.

• Japanese women were generally satisfied with their careers, but their commitments to jobs and organizations was not so strong, as compared to men.
• Women had strong connections to family, but their social networks in work were weaker.
• Women were more likely to be worried about selves and family.

[16:45]

[Pavel]

More theoretical work on the firm as a self-reproducing system.

• Summarized three major concepts in the contemporary theory of the firm.
  • 1. Technological black box, insert inputs and get outputs.
    • Fordistic view:  economies of scale, huge enterprises.
  • 2. Coasian paradigm, organizational:  boundaries of the firm, as an alternative to the distribution of resources to the market.
    • Go into the black box, and analyse how it operates.
  • 3. A systems thinking paradigm: 
    • A firm is a system that operates in a larger environment of interaction with a society, specifically a organized group of people that reproduce specific production activities.
    • Collective sustenance in a capitalist world.

Firm as survival:

• External survival:  you act better than your competitors do.
  • Given market rules, best operation -- classification.
• Evolutionary approach:  a new emerging theory
  • Also consider self-reproducing routines inside the firm.
  • Self-maintenance.
  • Can this be considered in a broader context?

3 types of processes:

• 1. Main production, or commercial activity.
  • Supposed to be beneficial to owner.
• 2. Throughout processes: finance, legal, IT.
  • Go into all other processes.
• 3. Coasian:  To firm owner, support self-reproducing activities.
  • Firm goes into cycles of reproduction, and can't achieve 100% efficiency.

Interaction with environment:

• Employees
• Network of suppliers
• Consumers
• Become dependent.

Many firms aren't achieving 100% profit or effectiveness.

• They can't live without maintaining themselves.
• Say first that firms are self-reproducers.

Self-reproducer, based on a conference on artificial life.

• Entrepreneurial ideal:  no formal structures.
• Semi-self-reproducers, depends on external environment.
• Self-reproducing corporation that insources many social functions.
  • e.g. Japanese business model, not only takes in usual functions, but also recreational and educational.

Firm as a formal self-reproductive structure.

• Similarly to work by John von Neumann
• Exactly correspondence to function in von Neumann automata.
  • Instructions, set of specific knowledge.
  • Production units as implementers:  labourers, machines
  • Copying unit:  to new machine, like educators or tutors.
    • Can be specific people, or middle managers that take over the structure.
  • Controllers:  coordinate blocks, as higher manager

Social cybernetics:

• Self-reference to activities of the firm.

Implications:

• Changing employee-employer relations, as employees are valuable.
  • Can't just kick out an unsatisfactory employee, need to deal with him.
• External:  firm becomes a social partner, in outsourcing certain social functions when applicable, or increasing social spending in the community.
• Organization design:  role of technology, knowledge databases, corporate training, tutors
  • Without tutors, won't get change, because they will maintain old structures.

In reference to organizational forms and evolutionary paths, analogy to biological evolution and firm evolution.

• Start with a predecessor to the firm, with shop craftsmen, who have full cycles of operations.
  • Transfers knowledge to co-workers, and transfer of instruments.
  • Like a cell, or bacteria, full information that transfers through self-division of material to its copies.
• Manufacturers:  workers with specific activities
  • Transfer of all knowledge through one agent.
  • Like a multi-cellular organization.
• Giant organizations:  blind alley
  • Giantism at the end of 19th century and beginning of the 20th century.
  • Much like biological organisms, have to change, because pre-social organizations.
    • Herds, flocks, prides
• In the 1970s, informational metaphors:
  • Interacting, yet independent firms operating in a network, that can reproduced only as unity.
  • Dependence on suppliers, and consumers.
• What's next?
  • In evolution, have society after pre-social.
  • A superpopulation with new laws.
  • Hypothesis:  Some innovation economy, on a society level.

[27:25]

Three different views:

• Evolutionary paths:
  • Base in technology, generalizable?
  • Career paths:  job satisfaction, as something for society and/or the role of women.
  • Don't know where we're evolving, now having speculative research on the network form organization.

[Open discussion]

Terminology:  self-reproduction.  Reproduction versus renewal.  Reproduction is a company creating a copy of itself, as a franchise, or a new entity in a different country.  Renewal of a company deciding it's too big, and needs to change.

Referring to more specific discussions in theory.

• Self-reproduction and renewal (as self-maintenance) are very similar processes, that may occur within the boundaries of the same system, or outside the system, but they occur in the same way.
• May apply to copies outside.
• Applies to copies inside, but replacing old things with new, within the boundaries.
• In time, they're different, although in space, they're the same.

Closer to Maturana's autopoesis?

Applying John von Neumann, which is not mentioned by Maturana.

• Asking:  what are the mechanics?
• Should have following elements of each firm.

Self-reproduction of what?  French sociologist / anthropologist Pierre Bourdieu, on social reproduction of practice.  Not so much organizational form, but practices.  Fields that reproduce.  Homo academicus, study of French systems of universities.  They way to get tenure is to publish papers, and the people who are reproducing and writing.

Consider a broader sense, in sociologies as institutions.

• Agents, an image of institutions in their heads, network of relations, practices and resources.
• All reproduced.

[32:50]

Study in life satisfaction, alternative methods in multi-criteria decision-making.

• e.g. satisfaction studied as customer satisfaction.
• Weights on criteria.
• Math programming model.
• Try to solve a utility function.
• Thoughts on these methods for your paper?

More general model, because building model would give a larger explanation.

• A study, versus a model?
• How transferable are these results?

Follow-up study to the previous?

Same data.

Also compared to another university.

Similar results, similar approach.

[36:45]

Luck.  Do you make your own luck?

It depends on your religion.

• There's a traditional approach, rationalist:  use reason, planning, multi-criteria decision making (as an advanced approach) and strategic thinking (reason-based), in order to make a new firm (replicated, duplicated, born).
  • Study to see the rational constructs.
  • In the Finnish context, it didn't help us explain much.
  • What does this allow us to do?
    • The traditional explanations couldn't explain much of anything.
  • One major government-owned firm with a very clear strategy.
    • It hung on to strategy for life.
    • It was the only failure.
    • It stuck to the original strategy of what is was going to do, and what it did and accomplished.
    • A total disaster.
• Alternatively, a more nebulous, ambiguous approach, using relationships, issues of trust, luck, happenstance, things that you can't find correlation between what appeared, and what was at the basis.

These managers were not careless or unsystematic.

• They tried to be rational, and to analyze situations.
• Everything that actually worked, and produced some end results were based on luck or personal relationships.

All successes were based on something else.

• Nice failures, based on strong rational conditions.

No profit maximizing, as predicted by theory?  No vision.

They only use these stories when someone comes to write a case about them.

• They don't both, e.g. defining long-term and short-term.

Stories to keep them off the street?

Need these structures to obtain money from others who believe in these structures.

• Ventures capitalists don't believe in these rationales, either.
• Better to go in with a description of relationships, which is better than some stupid model that the venture capitalist knows doesn't work, maybe better than you.

Venture capitalist reviews, they're not listening to content.

• They're listening for people who would do it for free, because eventually, they may be doing it for free.
• People that are doing it for the money don't last in the industry for long.
• Need a different motivation than the rational.

How you describe luck is tough.

• Outside of the study.
• A few years ago, a major international study, with the person who designed and owned Canary Wharf.
  • $15 billion project over 5 years with none of his own money.
  • Banks were lining up to give him money, at almost no interest.
  • Argued, in the interview, 95% of what I do is luck, and 5% is work.
  • If I could buy out the last 5%, I would.
• Did go bankrupt.
  • Business Week wrote an article that his luck had run out.
• 2 years later, at an auction, he bought back the whole project, completed by the British, 10 cents on the dollar.
  • Became the greatest real estate development in the western world.
  • Much richer than before.
  • Business Week asked, are we being conned by this person, or is he really lucky?
• The idea of luck is intriguing, and we haven't it captured it well.

With the power of computers, could we capture the order in the chaos?

This would be a positivistic approach, with which I'm not comfortable.

If paper were taken seriously, it would kill the approach of looking backward on how to do management.

• If it's not strategy, and not intelligent, and a random biological evolutionary thing that happens, is there a human element that plays, like intuition.
• Do some people sense the right direction, more than other?

It's distinctly not a hierarchical system.

• Is the system hierarchical, as Ashby would describe, or is something different?
  • A different sense of biology than Ashby or Herbert Simon would have argued for.
• Not a hierarchical phenomenon that you could structure in a deterministic model, then manage.
• It isn't open to this, unless we're a bit stupid.

Some empiricism or an example of such a firm?  One example?

Every firm does have these properties in its inner structure.

• There are firms that have more.
• Not just taking in prepared personnel, they upgrade them.
• They hold corporate databases, which hold knowlege available to the firm.

In consulting, products versus relationships.

• The partner will bring appropriate resources at appropriate times.
• How stable are these relationships?
  • Programs of up or out.
  • When outplaced, it adds to the network.
• Self-reproduction in a conscious way, as well as an emergent way.
  • Not everyone who goes into consulting is well-suited for consulting.
  • They're very capable and smart people, and can provide valuable functions for a new employer.
  • Their relationships are also very valuable.

Luck:  happenstance of when you look.

• Study when the stock market is booming, than later.
• Return to Peters and Waterman "excellent" firms.

Four years later, no longer excellent.

Bush administration declaring victory in Iraq, and some commentators think that they may be premature in that judgement.

[48:35]

Luck from what time horizon?

• Fate at work; or something beyond what you can see.

This depends on your religion!

Viagra:  was a quest for cardio-vascular medication, with a side-effect.

• Could say that it's luck that they found it.
• On the other hand, they used classical structures, and the side-effect emerged.
• The side-effect could be so large, so as become the main business.

Luck favours the prepared mind.

Intuition:  we have a brain that is so superior to any computational device, we still don't recognize how the brain operates.

• It might be inside the structures of a prepared brain, that it's luck.
• It's not luck; by intuition, people know what to do and when to do it.
• There's just a few people like this.

The opportunity recognition was facilitated by social connections, or "luck".

People who network (or who married rich).

Creating conditions for luck:  network, opportunities.

This sounds strategic?

Lying on the beach as strategic:  if you come up with one good idea.

Over how long a period do you need to observe, before you see that something is there?

• Most studies are not longitudinal.

Entrepreneurism:  how many times does someone have to fail before they become an "overnight success".

• Gambling in casinos:  craps is a long-term / short-term issue, where the house always wins in the long-term.
  • Strategies are exit strategies.
  • If you loose all of your money in the first five minutes, you're done for the day.

The way we think about systems may not be the way they really operate.

• They're just our mental models of the way things work.
• In the evolutionary path of business, we may or may have an influence on success.

Life satisfaction

• "Success in business".
• Life satisfaction is subjective and hard to qualify, but there are people who are happy with their lives.
• The role of women in Japanese society, towards careers.
• In the west, movement of women towards careers, for greater job satisfaction.
• But job satisfaction may or may not be related to life satisfaction.
• Lucky in job, or using a network to get a better job?

Why were women happier in life than in jobs?

Four years ago, Norwegian had a study showing that happy workers are bad workers.

• Unhappy people do a better job.

In Japan, is it good to be happy in the workplace?

Findings were that Japanese women were more satisfied with lives than jobs.

• Life satisfaction includes family.
• Japanese women find more satisfaction in their family than their jobs.

Separation between family life and work life as an artifact of modern life?

• 8 hours at work, then family life afterwards -- very 20th century, and doesn't go back far in history.

In the Japanese business model, take over some family functions, then encouraging people to increase their safety at the workplace.

In China, the corporation still takes care of housing and education.

• This was prevalent in the U.S. in the early 1900s.
• Corporate towns.

Hershey, Pennsylvania.

• Chocolate manufacturer built the down in the middle of nowhere.
• Milton Hershey built the schools, hospitals for free, for the employees.
• Then put these institutions into a public trust.
• Over the past 5 years, a movement to create more profits out of it.
• Employees have returned to a non-profit status, because without the benefits from the employer, Hershey wouldn't be a nice place to live.

Hershey was going to sell out, and the buyer was going to clean out the non-business parts from the corporation.

• The employees prevented this from happening.

Evolutionary efficiency:  if you are inefficient, you're taking in the wrong function.

How would you know that Hershey in inefficient?

The amount of resources taken in to reproduce these functions.

• If they don't generate enough profit, or substantial revenues to maintain their infrastructure, then they're inefficient.

But the shareholders were interested in selling their shares.

• The company was viable and profitable.
• A larger firm wanted to simply buy them, and buy their shares.
• As part of this, they would clean out the non-business parts, because they believed that they were not part of the 21st century corporation's role.

Workers claimed that they were going back to an older model.

What is the "firm"?  As opposed to a societal unit.

• Coase is an economic-only  view, not a societal function.

Broader context:  if we consider only economics, it's a profit-maker.

• A center of technology.

Openness in model.

• We may be thinking of firms as closed systems, whereas, in particularly the technology industry, it's more a network.
  • Sometimes they succeed, they come together, or fall apart.
• Thus, maybe form not just of firm, but the form of the society and the form of social structures of relationships.

Defining the firm, purely economically, is very mechanistic.

• What's in, what's out, what properties or characteristics apply.
• Equilibrium is a nice age-old property of systems.
• It applies in ways that are important to people: we like to create equilibrium and harmony.
• It's hard to maintain over time, requiring a lot of other things to maintain equilibrium.
• Not so much a natural process, but luck and randomness that occur in life.
• Equilibrium is at a moment of time, or over a short time period.

Punctutated equilbrium, or disequilbrium all of the time?

Two kinds of people?

• One needs form, and the other kind doesn't.
• Some need form and an entity to discuss that with, whereas there are others who can discuss without a form omnipresent.
• Some of favorite companies aren't well known; not because they're secretive, but because they don't need to be known.
  • Don't know their form, and they're concerned about it.
  • Form is a non-issue.
  • More of a process that is organic, that is hard to categorize in a Platonic world or system.
• Distinction is fascinating.

In the Syntegrity discussion this morning, most people were the formalists, and needed at least a dodecahedron to discuss anything.

If we talk about system, it has a form, but it's involving.

• Can't have a firm without a form, or a set of relations.
• But a strict form or a changing form?

What is a form?  Can't put a firm into a bottle.

Academics need to put firms into bottles.

A form is usually determined by an academic or consultant looking from the outside.

• Entrepreneurs, who just on the fly, get going, they may have some idea of what they want to achieve, but probably aren't focused on form.

In evolution, have information metaphors which are not firms, but entities that are so closely related that they are like firms.

• e.g. automotive industry, with developers of components, developers of tools, all working as one firm, but independent.

[Format gives us more time for discussion]

Firms have hierarchy, and can be viewed strategically or procedurally.

• Can see headquarters, divisions, departments, but can, for sure, see individuals.
• Don't like the word "luck".
  • Human beings guide business.
  • There's been a lot of work on the truth of the problem.
  • A lot has to be done on the development of human beings:  two types:
    • Development of business actions.
    • Spiritual development.
• If you have people being honest and sincere, this is towards the philsophical action of love.
• If love is created, then truth will come.
  • This will help human beings to find luck.
• Thus, spiritual development will help find a good technology for a group of people.
  • Maybe not the best technology, but something that suits that group of people.

Away from the mechanistic, this is a huge step.

Multimethodology called Stimulus:  designing different methodologies, including Total Systems Integration.

• How to be successful.

[Time check:  will move onto the second topic in 5 to 10 minutes]

Authors didn't like the word "luck".

• It's more an irritant than something of beauty.
• This term emerged in several areas of science to categorize things that are not explainable.
• American Association for the Advancement of Science recently reviewed a new book by Daniel Dennett:  Elbow Room, The Varieties of Free Will Worth Wanting.
  • Review about what does this mean for science.
  • The word "luck" was used in their review, as well as throughout the book.
  • Dennett was noted for writing Brainstorms in 1978.
  • This is a followup some years later.
• Is it worse to live in a deterministic world, or an indeterministic world?
  • Both a pretty awful.
  • A discourse on the bad of both worlds.
  • Perhaps we don't have a choice.
• Thus a return to what religion we believe in, because humans are quite limited, and can't answer this question very well.
• Dennett thus does a good treatise on whether we grapple whether we're dealing with deterministic (positivistic) stuff, or indeterministic (pure luck).
• We don't want the indeterministic world any more than the determistic world.
• Dennett thinks that there has to be something more.
• This is where the luck concept comes from, not because we like it.

If it weren't for luck, we might be a bunch of dinosaurs, here!

That's what the evolutionary people tell us.

[1:13:30]

[David Ing, in the role of moderator]

Second theme of two for today:  Inquiry and Practice

• Theme: One of the heritage foundations within the systems science community is inquiring systems. How should a social group collectively "know" which paths it should take? These three papers will lead to a discussion of how business organizations know, and the validity of that knowing.
• David Ing, Anticipating Organizational Competences for Development through the Disclosing of Ignorance
  • Got tired of working around knowledge management professionals, so started working on ignorance.
• Professor Gu, A Test on Metasynthesis System Approach for Running the Forecasting of the Growth Rate of GDP in China
  • If we try to guide direction, there are tools that we use to guide ourselves.
• Apostolos Lydakis, The Use of Systemic Methodologies in Workflow Management Systems
  • Practice, what we do, and how we do things.

Prior discussion in October on the Webboard on inquiring systems.

• Best textbook:  West Churchman, The Design of Inquiring Systems.
• Easier read:  Mitroff & Linstone, The Unbounded Mind.
  • How do we really know, as a social group.

The fast, philosophical summary of how we know.

• 1. Inductive-consensual:  If everyone in this room agrees the world is flat, the world is flat.
  • Locke
• 2. Analytic-deductive:  Mathematically-based, start from axioms and build up.
  • Practically, scorecards, or a check list ranking.
  • Leibniz
• 3. Multiple realities:
  • Kant
  • No separation of model from the data.
  • Everyone has a brain, and each knows things, but knows differently.
  • In business, instead of using a scorecard, we refer to experts.
    • e.g. world's expert on growing mushrooms -- which represents truth.
• 4. Conflict:
  • Hegel.
  • Two people debate from polar opposite positions.
    • Not because they believe these positions.
    • Truth as somewhere in between.
    • In the debate, neither of the debaters learns anything, but observers get to learn.
• 5. Unbounded systems thinking or systemic reasoning:
  • Edgar Singer, via Churchman (who was a former president of the ISSS)
  • Incorporate all of the prior four inquiring systems.
  • Vince Barabba at General Motors uses techniques this way.
  • This SABI session is also an attempt to try to do this.
  • Debate, but we rotate who speaks.
  • Ideas get swept in, knowledge creation rather than knowledge replication (in the knowledge management system)

[1:21:10]

[David Ing]

Ignorance paper co-authored with Minna Takala and Ian Simmonds.

• Program at the U. of Arizona College on Medicine, the Program on Medical Ignorance.
• When training doctors, a dilemma:
  • A practicing doctor who diagnoses a patient with a bad disease, asks "doctor, are you sure".
    • Want certainty, so patients can move onto their lives.
  • While training, medical doctors should understand that science doesn't know everything.
    • Various instruments and tools to chart things.
    • What's important is not what you know about the patient, but what you don't know about the patient will kill them.
• Makes the medical community focused on ignorance.

Applied to business, Minna has the job developing ignorance.

• Thus, had to provide definitions of competency (and capability).

Related to epistemology, am trying to move away from the traditional ideas about "knowing".

• e.g. the book, The Knowing-Doing Gap .
• Moving towards practice-orientation, embodied knowledge.
  • People do things not because they're optimizing, but because that's how things are done in society, or how they're trained as they're brought up.
• Have book looking at the phenomenological
  • Disclosing New Worlds, based of the community around Heidegger.
  • A new world is not just an idea, it's an observation about practices.
  • People are naturally world disclosers.
  • They will find new ways to do things, and reproduce ways.

Relative to inquiry and practice, like the inquiring system approach which tackles "how we know".

• Does it go as far as embodied knowledge, so that we don't have to explicitly know, but just do things because they're the right things to do.
• Links to social practice, as what people do.

[1:25:10]

[Professor Gu]

Three cycles in systems:

• 1. Soft systems thinking
• Discuss inquiry, without mathematical formulas.
• 2. Mathematical models
• e.g. multiple criteria decision-making.
• 3. Engineering:
• Decision support systems, etc.

In China, Professor Qian suggested a meta-synthesis approach.

• Help to to analyze complex giant open systems, e.g. social systems and economic systems.

Metasynthesis in three parts:

• 1. Qualitative metasynthesis, e.g. soft systems thinking.
• 2. Qualitative to quantitative metasynthesis:  hard systems approaches
• 3. Quantitative to quantitative metasynthesis:  propose some hypothesis, and then verify with mathematical model.

Applied this metasynthesis approach:

• #1:  synchronous meeting:  ask experts, what we wish to do.
• Create some scenarios or hypotheses
• Create mathematical model.
• #2:  mathematical model, with hypotheses.
• Then conclusion, with invited experts, users, leaders.

Proposed DMTMC system:

• Meeting to gather data.
• Data, information, knowledge.
• Used a network communication technology.
• Provides some methods, mathematical models.
• Finally, reached a consensus.
• Consensus doesn't mean everyone agrees with the idea.

With idea, test if right or not.

• Tested in Japan.
• Problem in forecasting GDP in China
• Invited 8 people.

[1:30:20]

[Apostolos Lydakis]

More practical view.

• With professor Nikitas Assimakopoulous, University of Piraeus.

Workflow management systems support collaborative management of business processes.

• Individuals have different needs for information and authority.

Virtual process

• Methods to improve the modelling procedure.
• Constructing a virtual process means grouping activities for a level of abstraction for a manager.
• Managers and marketers have different needs.

Have used four methods:

• Problem Structuring Methodology (PSM) to design the problem.
• Meta-systems methodology (of John von Gigch) to control the situation.
• Combination of SAST and Interactive Planning (Churchman) to facilitate the information between the parts.
• PSM gives structure to the problem, focusing mainly on the human factors.

(Final drawing, of PSM methodology):

• All of the problem situations.
• Can be developed at different hierarchical levels.
• Systems and subsystems; humans.
• Subsystems, sub-subsystems, communications.

Have a view of the information flow with the organization, thus can monitor communications and provide control to malfunctions.

• e.g. conflicts between people that slows the systems.
• Metacontroller can deal with the problem situation.

To make this design, building a knowledge base of interviews with participants.

• Gather information about how the individuals within the organization interact.
• The organization may take advantage of this, to improve human factors.
• Focus on humans.

[1:36:20]

[Handed over chair to Gary Metcalf]

Gu's presentation, with comparision to Christakis methodology today:

• Christakis said needed at least 8 people.
• Also 8 people for metasynthesis approach?

No, just a coincidence.

Christakis methodology is like playing an orchestra.

• Similarities?

Yes.

Cogniscope or Webscope in the preparation of this conference.

• Inquiring systems idea of sweeping in, to bring in new knowledge.
• Problem in Cogniscope was that it was highly reductive, first two ways of knowing.

Agreed.

• Also it takes too much time for decisions that shouldn't take much time.
• Could take 2 to 3 minutes for decision that is simple.
• At a democratic level, have to vote for knowledge.

Ignorance, as a shift from knowledge management.  Is ignorance is always a negative?

Paper ends with a discussion of ignornance as bliss, and we don't want to know.

• In Disclosing New Worlds, description of entrepreneurism.
• Someone will bring a new product to market.
• Sometimes it resonates and takes off.
• In other cases, it's another product failure.
• What is it about this new world, that they've found a better mousetrap?
• Some people can't make that bridge, and are totally ignorant.
• Some people "know" and live in the new world
• e.g. spending 10 hours per day on the Internet, as compared to people who spend zero time on the Internet.
• Thus, part of a world of technology, where others are ignorant.
• Ignorant is not a bad thing.

Ignorant as meaning that you're not living in democracy, and we'll teach you.

No, not trying to use ignorance as a bad word.

• Ignorance as a world that they don't see or don't recognize.
• Pierre Bourdieu, Algeria 1961, observed French experts sent to help Algerians.
• French saw it was obvious that the Algerians should terrace the land, because it was poor and inclined.
• Algerian farmers would say "why should we do that?  We've been farming this way for 1000 years"
• This could be termed as ignorance.
• A few farmers were more progressive, and tried it, and discovered it worked.
• Then observed by other farmers.
• No longer a French-to-Algerian transfer, but an Algerian-to-Algerian transfer of knowledge or practice.
• Ignorance had a bad connotation in the way people often use the word.
• We shouldn't take it that way.
• We should embrace ignorance.
• Requires some humility to accept ignorances.
• Weak in biological systems, but know things about other systems.
• Interest is not so much ignorance at an individual level as ignorance at a social level.
• There are people that live in one world, and people that live in another world, and whether they meet / exchange / adapt to each other is interesting.

[1:43:40]

Is knowing also a good thing in business?

• Spending too much time in discussion often wastes the opportunity.
• The president of Oracle to Wharton students:  "you'll never be rich because you're studying management; I never thought about studying management, and just did things.  Without knowing, just believing".
• Should a social group know its path?

Knowing is a dangerous word

• In the Parhankangas / Hawk paper, knowing what the strategy or business direction.
• In Apostolos' paper, in workflow, there are people who "know" the workflow.

The manager who stays in his office, drawing designs, when there are thousands of workers who work with each other.

• This manager doesn't know.
• Thus, need multiple controlling views.

Strategic level, procedural level.

• Better than a flowchart.
• Not sequenced.
• Helps to take know-how from users.

Restrict the kind of knowing?

• At the procedural level, follow specific steps.
• The user writes down in words, the procedure.
• Design the procedure in a flowchart, something simple.
• Then review with users.
• Not reductive, a richer picture, as Checkland says in SSM.
• Structure, not clouds.

[1:48:30]

Distinction between ignorance and cognitive blindness?

• Ignorance management versus knowledge management.

At a social level, ignorance is similar to cognitive blindness.

• Certain groups are blind to certain things, so similar.

Ignorance management presents an oxymoron with the word "management"

• Hope of something more open.
• e.g. the idea of luck.
• If people aren't open to luck, that's an ignorance or a blind spot.
• If they think the world is deterministic, or strategy will work out, or can chart the work as workflow, then it's a blindness or ignorance.
• Risk:  it's not what you know that will kill you, it's what you don't know that will kill you.
• This is really lacking in the current knowledge management.
• Churchman inquiring system, fifth way of knowing, has an emphasis on sweeping in new knowledge.
• If you're not creating new knowledge, then you're not operating the system properly.
• In traditional knowledge management, there's a lot about capturing knowledge, and then replicating.
• Nonaka tacit knowledge / explicit knowledge is a sink hole.
• If trying to to codify certain things, what happened to the ignorance, the sweeping in and the rest of the world.
• Much of this type of knowledge management is turning the world into a closed system.

[1:51:45]

If in a state of ignorance, wouldn't know about luck.

College of Medical Ignorance categorizes types of ignorance:  known unknowns, unknowns knowns, unknown unknowns.

• Luck may fit in the category of unknown unknowns.
• Known unknowns are a good thing:  you can do research.
• Unknown knowns within a group:
• I don't know how to scuba dive, but someone in the group must know, and could tell us how.
• Hidden knowledge.
• Unknown unknowns [mispoken ad unknown knowns!]:
• Can't handle them.
• Take your team to an art gallery.
• These are connections that the human mind doesn't make linearly.

How do you know you don't know?

• Humans born as knowing?
• Methods from ancestors?
• Eastern civilizations:  born with knowing.

Bateson?

Several types of unknowing:

• Information about a sphere, but don't know anything about it.
• Feel a lack of knowledge, but can't formalize it in some way.
• Scientists knows something, but can't grasp it.
• We are moved by not knowing, and can learn or study.

In the world of Bateson, he defines the problem differently.

• Distinction of unaided rationality -- which is pejorative.
• What we know.
• If we act only on what we know, then we're in trouble, because it's a rationality that desperately needs to be aided.
• If we don't bother to bring in aids, and act, then the world of unaided rationality looks different.
• What is the rest of the stuff that Bateson and others grapple with?
• David Hawk calls it the world of the non-rational.
• Thesis: about 10% of what we deal with is rationality.
• Most people like to stay with the 10%.
• 90% is the world of the non-rational.
• Thesis:  If you insist on the world of the rational, then by definition, you will generate the world of the irrational.
• If insist on the world of the rational, can't accommodate the non-rational.
• Question implies that can accomodate the non-rational.
• This is an non-question.
• Another way of framing the question would be:  managing ignorance, or managing being ignorant.
• Managing ignorance is strategic, need to know.
• You'll die before long, you don't need to know.
• Managing being ignorant means that you do know it, but you know that you can grapple with it, and deal with it.
• This is more Bateson's world, of going beyond unaided rationality, and grappling with this other stuff.
• A number of philosophers argue that the best way to deal with this is to do something else.
• Do not deal with it head on.  You will lose.  You will point out that you're a loser, and everyone else will notice.
• So you do something else.  You learn a lot about it by doing something else.
• Managing being ignorant is a cut above.
• A Finnish student, based on a lecture of ignorance, decided to do a thesis on it, and never came back again.

Ignorance is good for global managers:

• Want 90% of the people to not know, so cultivate ignorance.
• This is negative for most, positive for those who govern the world.

Ignorance as manipulation?

Saying someone is ignorance is a manipulation.

Return to a discussion of organizations.

• People are asked to focus on things that are rational and appropriate.
• This does close what people think is appropriate or useful or productive to know.
• The rest of the world, don't know about.

Different types of ignorance:

• One type is just not knowing.
• Another type has to do with perspective.
• Some connection with luck.
• If you leave the door open, perhaps luck will strike.

Link to job satisfaction and happiness.

• Secretaries are miserable, CEOs are not.
• Secretaries know more about what happens in the firm, whereas CEOs seldom does.

To know without control can be a precarious place.

Secretaries regulate information flow.

Some secretaries have more of a conscience.

Job satisfaction of women managers in Japan:  they know, but don't have the power to do anything about it.

Corporate visit in China at Bristol-Myers Squibb, U.S. firm with all Chinese people working.

• Four young men who were vice presidents.
• Six ladies who were not vice-presidents.
• Four men kept making presentations, and the ladies kept correcting them, all the way through.
• Men didn't have any idea of what was happening, and the women controlled all the information.
• In disgust, one woman got up and told the man to sit down, presenting what was going on.
• Remarkable:  American MBA students thought that this was unusual, and didn't see that this was the way back home, too.
• Women in the group saw that this was the same as back home.

CEO of Intel Israel cancelled all secretaries' jobs.

In a position of the COO:

• The devil is in the details.
• The angels are in the details.
• This is learning, coming from an academic background, the building of business from a detailed level.
• There's no place for luck.
• The board members won't agree with our discussion here, as the money comes from their own pockets.

In American firms, the board members don't know and don't care (as demonstrated by the last 2 years of history).

Education company on Wall Street was examined by analysts.

• Won't accept untested assumptions.
• Reliance on luck as laziness.

On Wall Street, most stockholders don't understand the business, and rely on analyst.

Board members are sure.

Not our experience.

• Executives versus workers.

Managers don't know.

Coming back to governance discussion from last night.

• Levels of knowing, spheres, realms:  expectations about knowing, finality, being definite and concrete.
• When a company projects what the economy is going to be, people don't want to hear "roll the dice".
• Craps may have a strategy, but don't want to base a national economy on it.
• Knowing as a choosing of awareness beyond what is expected.
• It doesn't change the expectations of the role.

Business view on the difference between entrepreneurs and academics:

• Would say academics have misplaced concerns.
• What really matters, in a consulting experience, is first to respect the client's ignorance, instead of putting yourself into the position, and teaching people.
• New definition of consultant:  to confuse and insult.
• Don't want to put self into this.
• Need to understand that their ignorance is reasonable.
• In practice with Professor Gu, have to put in a multiplier for the opinions of leaders.
• In western countries, this is unaccessable.
• In their political reality, this makes sense.

No problem with detail emphasis:  this is related to people that don't need form.

• Life can interesting in the details.
• The board as all-seeing:  the Worldcom board of directors say that they were ignorant.
• Did they see the details of Worldcom, and really understand it, or were they blind?

Specific in the education business.

• In most cases, you can't make money in education.
• Either there's an external source of funding, that allows quality, or a poor level of funding with lousy quality.
• Developed a method for mid-level quality, with reasonable profit.
• Have to attend to details:  marketing, hiring of faculty.
• Board members were very knowledgeable.

Worldcom board members:  when they say they're ignorant, are they lying to us?

If they're blind, there's hope that they could be helped, but if they're lying, it's completely different.

Colleagues in business suggest that Worldcom board members are quite representative of most boards:

• They haven't taken the time, nor do they have the understanding that the governance systems says that they should have.
• By definition, the governance system can't work that way.
• A more optimistic view about governance systems?

Two cases:

• Situations where boards don't care, and delegate to managers, especially when they're successful.
• This was the case of Worldcom:  good indicators, and no one looked deeply at how success was achieved.
• Satisfied.
• Another case:  they don't believe that the company is a success, and then will look at details.
• When worried about money, will look at details.
• This isn't about efficiency of the governance system, it's about the perception of investors about the success of the business.
• It's also not about luck, only about representation.

Enron wasn't unlucky.

Enron was doing things that couldn't be shown in reports.

Ignorance as denial.

Cognitive blindness:  can still be blind, e.g. Bay of Pigs, Cuban Missile Crisis

• CIA had lots of information, but still blind.

Weapons of mass destruction.

Growing mushrooms:  handling boards of directors, keep then in the dark, and feed them lots of manure.

With mushrooms, need machines in the back to wash them.

• Governance issue:  approach to reduce the reliance on luck.

[2:17:30]

Allow people to make some summary statements, or make some suggestions as to areas to be explored for next year.

Invitation to work on curriculum design on conversations, group dynamics, planning, team building, quality improvement.

Importance, value?

Meta-comment on organizing this SIG:

• Traditionally, chaired by Enrique Herrscher.
• Took over this role.
• Special Integration means something.
• Motivation to structure this way to get rid of paper presentations and draw on the broader knowledge that people have.
• By the time you've finished working on the paper, may be sick of the paper, and looking elsewhere.
• Offer of CD-ROM and digests to spur on next year's discussion.
• Dialogue on framing issues, on the WebBoard, as dichotomies or polar positions.
• When the papers came in, they were resorted into these categories, which were made up.
• In some respect, they're arbitrary categories.
• For next year's talk, hope that discuss this session with other attendees at this conference.
• If you want to have a paper in this session, you have to designate that you want to be here, and won't be presenting a paper.
• There may be reasons to have to present papers, e.g. if you're a university academic, and require it for funding.
• Also, there are others who aren't comfortable with this free-flowing discussion.
• You can always read the CD-ROM at home.
• The conversation may have given a better understanding of the person, and where the paper is coming from, than from presentation of the paper directly.
• Papers are bounded about the way we understand the authors.

Next year, Asilomar, Pacific Grove (Monterey) California

Pouring wine for presenters encourages presentations.

First time attending a systems conference, was scared of academic work.

• Format of this session helped to learn.

Challenge in the systems community:

• Problem with people learning systems.
• Maybe the way to learn systems is not to take them head-on.

Understanding of the business world helped in this presentation.

Could topics be structured in advance, by announcing the topics first?  Then brainstorming, and posting of papers?

We did that, but it didn't work.

• This is a pre-categorization / post-categorization problem.
• Creating topics in advance is pre-categorization.
• Other sessions decide in advance how they'll discuss.
• Have discovered that all of the structure emerges after the content is in.
• Will do the same thing again next year:  post topics, and get submissions that are close.
• Luck and chance, in emergence:
• There's a resistance towards emergence and luck, because we think we can control systems.
• Not here to control systems, but to facilitate discussion.
• For the rational people, have set topics.
• Papers were clustered by the contributions of the authors.

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