Inspired post by Dave Pollard today on the challenge of scale and the confusion of control. Complicated systems require few connections in order to be manageable:
It is because business and government systems are wedded to the orthodoxy of hierarchy that as they become larger and larger (which such systems tend to do) they become more and more dysfunctional. Simply put, complicated hierarchical systems don’t scale. That is why we have runaway bureaucracy, governments that everyone hates, and the massive, bloated and inept Department of Homeland Security.
But, you say, what about “economies of scale”? Why are we constantly merging municipalities and countries and corporations together into larger and ever-more-efficient megaliths? Why is the mantra of business “bigger is better”?
The simple answer is that there are no economies of scale. In fact, there are inherent diseconomies of scale in complicated systems. When you double the number of nodes (people, departments, companies, locations or whatever) in a complicated system you quadruple the number of connections between them that have to be managed. And each “connection” between people in an organization has a number of ‘costly’ attributes: information exchange (“know-what”), training (“know-how”), relationships (“know-who”), collaboration/coordination, and decision-making. That is why large corporations have to establish command-and-control structures that discourage or prohibit connection between people working at the same level of the hierarchy, and between people working in different departments.
Why do we continue to believe such economies of scale exist? The illustration above shows what appears to happen when an organization becomes a hierarchy. In the top drawing, two 5-person organizations with 10 people between them have a total of 20 connections between them. But if they go hierarchical, the total number of connections to be ‘managed’ drops from 20 to 8. Similarly, a 10-person co-op has a total of 45 connections to ‘manage’, but if it goes hierarchical, this number drops to just 9.
This is clearly ‘efficient’, but it is highly ineffective. The drop in connections means less exchange of useful information peer-to-peer and cross-department, less peer and cross-functional learning, less knowledge of who does what well, less trust, less collaboration, less informed decision-making, less creative improvisation, and, as the number of layers in the hierarchy increases, more chance of communication errors and gaps.
But, what about complex systems?
So back to the purpose of this post, to answer these questions: 1. What is it about the ‘organization’ of the Internet that has allowed it to thrive despite its massive size and lack of hierarchy? And: 2. What if we allowed everything to be run as a ‘wirearchy’?
To answer the first question, the Internet is a “world of ends“, where the important things happen at the edges – and everything is an edge. “The Internet isn’t a thing, it’s an agreement”. And that agreement is constantly being renegotiated peer-to-peer along the edges. If you look at the diagram above of the co-op with the 45 connections, you’ll notice that the nodes are all at the circumference – around the edges. There is no ‘centre’, no ‘top’. And the reason the organization isn’t weighed down by all those connections is that they’re self-managed, not hierarchically managed. The work of identifying which relationships and connections to build and grow and maintain is dispersed to the nodes themselves – and they’re the ones who know which ones to focus on. That’s why the Internet can be so massive, and get infinitely larger, without falling apart. No one is in control; no one needs to hold it together. It’s a model of complexity. And, like nature, like an ecosystem, it is much more resilient than a complicated system, more effective, and boundary-less. And, like nature, that resilience and effectiveness comes at a price – it is less ‘efficient’ than a complicated system, full of redundancy and evolution and failure and learning. But that’s exactly why it works.
via What If Everything Ran Like the Internet? « how to save the world.
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Richard Straub writes in the Harvard Business Review, on a great piece about what stops managers from adopting complexity views:
Complexity wasnt a convenient reality given managers desire for control. The promise of applying complexity science to business has undoubtedly been held up by managers reluctance to see the world as it is. Where complexity exists, managers have always created models and mechanisms that wish it away. It is much easier to make decisions with fewer variables and a straightforward understanding of cause-and-effect. Here, the shareholder value philosophy, which determines so much of how our corporations operate these days, is the perfect example. Placing a rigid priority on maximizing shareholder returns makes things clear for decision-makers and relieves them of considering difficult tradeoffs. Of course we know that constantly dialing down expenses and investments to boost short-term margins inevitably damages the long-term health of the company. It takes a complexity approach to keep competing values and priorities and the effects of decisions on all of them in view – and not just for management, but equally for investors, analysts, and regulators.
In the short term, a reductionist mindset is most useful for winnowing away externalities so that you can show that what YOU did had real results in the real world, thus justifying your value to the accountability chain and the shareholders.
via Why Managers Havent Embraced Complexity – Richard Straub – Harvard Business Review.
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Here on Bowen Island, we are still small enough and friendly enough that stuff like Bowen LIFT can get started relatively easily. Bowen LIFT is trying to help people self-organize transportation options to complement our limited but excellent public bus service. This morning on CBC Radio, our LIFTers got a lift of their own. Listen to the podcast here.
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It’s an old saw with me, but Dave Snowdon puts it very nicely and succinctly:
Numbers are good, but they are never the whole picture. Its easy to focus on them, they give the comfort of apparent objectivity and used to support human judgement they have high utility. The problem is when they replace judgement rather than supporting it. Of course in the ordered aspects of any enterprise statistics and numbers can do a lot of the work for you, but in a complex situation they can be dangerous. Applied to ordered aspects (boundary conditions, probes and the like) they have utility, but for the system as a whole they are more problematic.
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Very few of us have our hands on the real levers of power. We lack the money and influence to write policy, create tax codes, move resources around or start and stop wars. Most of us spend almost all of our time going along with the macro trends of the world. We might hate the implications of a fossil fuel economy, but everything we do is firmly embedded within it. We might despise colonization, but we know that we are alos guilty of it in many small ways,
The reason challenges like that are difficult to resolve is that we are embedded within them. We are a part of them and the problem is not like something outside of ourselves that we apply force to. Instead it is like a virus or a mycellium, extending it’s tendrils deep into our lives. We are far more the product of the problems we wish to solve than we are the solutions we long to develop.
Social change is littered with ideas like “taking things to scale” which implies that if you just work hard enough, the things you will do will become popular and viral and will take over the world. We can have a sustainable future if “we just practice simple things and then take them to scale.” The problem with this reasoning is that the field in which we are embedded, that which enables us to practice small changes is heavily immune to change. Our economy, our energy systems, our governments are designed to be incredibly stable. They can withstand all kinds of threats and massive changes, This is a GOOD THING. I would hate to have the energy system that powers my life to be fickle enough to be transformed by every good idea that comes along about sustainable power generation. So that is the irony. In the western world, the stability that we rely on to be able to “make change” is exactly that which we desire to change.
We are embedded in the system. We ARE the system. That which we desire to change is US. You want a peaceful world, because you are not a fully peaceful person – violence has seeped into your life, and you understand the implications of it. This is also a GOOD THING. Because, as my friend Adam Kahane keeps quoting from time to time “if you are not a part of the problem, you cannot be part of the solution.” Real change in stable societies like Canada comes only from catastrophic failure. That may be on our horizon, but I call you a liar if it’s something you desire. It will not be pretty. Living on the west coast of Canada, I sometimes think about it because a massive earthquake will strike here – possibly in my lifetime – and it will change everything instantly and massively and forever. So, while climate change and economic collapse are probabilities, earthquakes are certainties.
So let’s forget about prototyping new things and “taking them to scale.” But let’s not forget about prototyping new things. Because one of the big lessons from the living systems world view is that change happens in an evolutionary way. It happens deep within the system and it requires two resources we all have – creativity and time. It does not require hope. Living systems do not hope. They just change.
Years ago I was inspired by Michael Dowd’s ideas captured in “Thank God for Evolution” in which he talks about mutations as the vehicle of change in evolving systems. Of course this is a widespread thought, but it was quite liberating to me when I first discovered it because it compels us to use our own creativity to make change. Practicing something different, as some small level, is not a useless endeavour. There is no way to know what will happen when you mutate the system. And so that is a reason for practicing. That is why I love Occupy and #IdleNoMore and other social gathering practices. They are creative mutations of the status quo. And they are undertaken without any expectation of massive change. Instead they seed little openings, the vast majority of which don’t go anywhere. In an evolutionary system, mutations may introduce new levels of adaptability, but they might alos kill off the organism. But to survive and evolve, an organism needs to mutate. Remaining the same is also suicidal, because everything else is mutating and changing, and you will lose your fitness if you don’t also change.
So the second resource we all have is time. if you are beholden to making change along a strategic critical pathway, especially in a complex living system, you will suffer terrible delusions. Very few of us have that kind of time. The kind of time we do have is the time to let whatever we do work or fail. To orient yourself to this kind of time, you need to practice something with no expectation of it’s success. The moment you cling to a desired result is the moment suffering creeps into your work, and the moment you begin to lose resilience. Adaptability is reliant on creative imaginations working resourcefully.
So changing from within has something to do with all of this. Watching #IdleNoMore is to witness a celebratory mutation in the system of colonization. It is impossible to say if it will have the desired results that people project upon it. But of course it will “work.” We need to sit and watch it work as a mutation in a living system. And the bonus is that we get to round dance while we do it!