Digest -- SABI Roundtable, July 8, 2003, at Hersonissos, Crete
Special Integration Group on Systems Applications in Business and Industry
International Society for the Systems Sciences

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

First half, discussion on three papers:


[Pavel Luksha arrived]


[Annaleena Parhankangas]

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

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

Found out:

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

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

Benefits to organizations, in finding new products areas



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

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



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

Firm as survival:

3 types of processes:

Interaction with environment:

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

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

Firm as a formal self-reproductive structure.

Social cybernetics:


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


Three different views:

[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.

Closer to Maturana's autopoesis?

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

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.


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

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

Follow-up study to the previous?

Same data.

Also compared to another university.

Similar results, similar approach.


Luck.  Do you make your own luck?

It depends on your religion.

These managers were not careless or unsystematic.

All successes were based on something else.

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

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

Stories to keep them off the street?

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

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

How you describe luck is tough.

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.

It's distinctly not a hierarchical system.

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

Every firm does have these properties in its inner structure.

In consulting, products versus relationships.

Luck:  happenstance of when you look.

Four years later, no longer excellent.

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


Luck from what time horizon?

This depends on your religion!

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

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.

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?

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

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

Life satisfaction

Why were women happier in life than in jobs?

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

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

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

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

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.

Hershey, Pennsylvania.

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

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.

But the shareholders were interested in selling their shares.

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

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

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

Openness in model.

Defining the firm, purely economically, is very mechanistic.

Punctutated equilbrium, or disequilbrium all of the time?

Two kinds of people?

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.

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.

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

[Format gives us more time for discussion]

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

Away from the mechanistic, this is a huge step.

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

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

Authors didn't like the word "luck".

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

That's what the evolutionary people tell us.


[David Ing, in the role of moderator]

Second theme of two for today:  Inquiry and Practice

Prior discussion in October on the Webboard on inquiring systems.

The fast, philosophical summary of how we know.


[David Ing]

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

Applied to business, Minna has the job developing ignorance.

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

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


[Professor Gu]

Three cycles in systems:

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

Metasynthesis in three parts:

Applied this metasynthesis approach:

Proposed DMTMC system:

With idea, test if right or not.


[Apostolos Lydakis]

More practical view.

Workflow management systems support collaborative management of business processes.

Virtual process

Have used four methods:

(Final drawing, of PSM methodology):

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

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


[Handed over chair to Gary Metcalf]

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

No, just a coincidence.

Christakis methodology is like playing an orchestra.


Cogniscope or Webscope in the preparation of this conference.


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.

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.


Is knowing also a good thing in business?

Knowing is a dangerous word

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

Strategic level, procedural level.

Restrict the kind of knowing?


Distinction between ignorance and cognitive blindness?

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

Ignorance management presents an oxymoron with the word "management"


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.

How do you know you don't know?


Several types of unknowing:

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

Ignorance is good for global managers:

Ignorance as manipulation?

Saying someone is ignorance is a manipulation.

Return to a discussion of organizations.

Different types of ignorance:

Link to job satisfaction and happiness.

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.

CEO of Intel Israel cancelled all secretaries' jobs.

In a position of the COO:

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.

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

Board members are sure.

Not our experience.

Managers don't know.

Coming back to governance discussion from last night.

Business view on the difference between entrepreneurs and academics:

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

Specific in the education business.

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:

Two cases:

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

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.


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:

Next year, Asilomar, Pacific Grove (Monterey) California

Pouring wine for presenters encourages presentations.

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

Challenge in the systems community:

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.

x x


Some content on this website may be subject to prior copyrights.
Please contact the author(s) prior to reproduction or further distribution of the materials.