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Decision Theory in Complex Systems

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Lessons from Complexity Theory

Leaders of an organization cannot know, anymore than anyone else can, where the organization is going. The future is uncertain and probabilities and risk factors cannot be measured. As local and global environments become more complex, landscapes will dance to a faster tune. The pace of evolution and change in organizations that learn to adapt more quickly will prosper and survive.
Large breakthroughs and emerging phenomena will arise in the organization that recognizes itself as a complex system and manages itself accordingly.
The role of management in the organization is both complex and paradoxical. On the one hand management has the responsibility to maintain stability and organization, while at the same time, allowing and fostering the presence of disorganization wherein learning, change, and creativity may flourish.

Ralph Stacey summarizes the role of management. “A complexity theory of organizational development therefore ascribes very important and very difficult roles to management in addition to the currently dominant notions that also continue to be important from an ordinary management perspective. Complexity theories of management lead to a very rich, paradoxical theory of leadership in which leaders have to be both the conventional directors of others in the far more subtle containers of their anxiety and provokers of their double-loop learning capacity. These different attributes of leadership do not blend harmoniously with each other. Instead, they conflict with each other; directing and intentionally not directing are diametrically opposed ways of behaving and both are required of an effective leader in a complex adaptive system.”

Complexity theory does not give us a new, theory du jour of managing and decision making. Rather, it sheds light and allows us to see more deeply into the not-so-neat world of organizational leadership and action.

Bibliography

Arrow, Holly, McGrath, Joseph, and Berdahl, Jennifer (2000) Small Groups As Complex Systems. Thousand Oaks, CA: Sage Publications.

Page, Scott (2009) Understanding Complexity. Chantilly, VA: The Teaching Company.

Stacey, Ralph (1996) Complexity and Creativity in Organizations. San Francisco, CA: Berrett-Koehler Publishers.

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