Complex Systems - Business Through a New Looking Glass Editor: Advitech

Largely unseen by business and by the public generally is a remarkable evolution of the social sciences and hard sciences that has been gathering momentum for over twenty years. Seemingly disconnected topics such as war fighting, the stock market and chemical reactions have much in common. The basic principles tying these and other topics together are described by complex systems science, sometimes called "chaos theory".

It was in the development of computers and the attempt to solve non-linear mathematics where discoveries in complex science began. Initial research concentrated around the extraordinary and beautiful outputs from repetitive application of very simple non linear equations within "computer space" . Some popular science television programmes have featured the original computer outputs, known as Mandelbrot Sets, which have infinite depth, beauty and repetitive features (see images on right).

More recent work is in an area known as multi-agent systems science, or network theory. Though much work is mathematical in nature and can only be modelled by computer, these sciences are evidenced by remarkable parallels in evolutionary biology and human systems such as those found within business organisations.

Applications within Business

Of particular interest to those in business or the management of large organisations is research targeted around interactions between staff and processes within an organisation, and how outcomes from complexity science can guide management decision making in a time of constant change.

Similarly, businesses exist as agents within an ecology of staff, customers, suppliers, government and other bodies which have an effect on their success.

Network theory provides insights into these large complex sets and helps business decision making and risk management processes.

Examples

A simple example is the famous "six degrees of separation" as applied to business. By understanding the connections between organisations, and the strength and nature of those connections, opportunities for advantage become possible. The common concept of ' networking' at business functions is an application of complex systems theory.

Another example is found in businesses that have had terrific success in the growth of their activities. It is often a seemingly serendipitous event which initiated the growth. Some would call this event luck, but complex systems science provides a completely different explanation. Avalanches, power laws and evolutionary pressures all have something to say about these events.

Advitech & Complex Systems

Advitech Pty Limited has been using complex systems science as an aid to management decision making and the design of its company structure from the early years, with much success. For further information on complex systems and management theory, contact Larry Platt on 02 4961 6544.

'Mandelbrot Set' images from complex science theory

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