Page 55 - The Complexity Perspective 20 02 18

In all these cases, a tipping point arises, when the economics of the old
system are undermined and it moves from a system in stable
equilibrium to a state of near chaos, actual chaos, or disorder. The

normal response of a system under such stress is to attempt to survive.
The required leadership response is to impose order and then attack
the problem through stabilizing the resources of the business (people,

funds, productive capacity), reshaping the system goal and translating
that into a revised business model, and then pushing the process of
detailed implementation out to the edges of the organization.

Disruption is the term used today to describe the turbulence created
by the current flowering of digital technology. It is, however, worth

remembering that Disruption is an inevitable and inherent
characteristic of an emergent context. It occurs at all levels of
integration (e.g., the French Revolution) and will happen forever.

Academic Manifestation of Ashby's Law

The above discussion is rooted in complexity thinking. But, Ashby's

Law is also the (unstated) underpinning of the work of academics in
sociology and has been explored for decades under the name
Institutional Theory. (Scott (1995)

In Institutional Theory, the ideas, norms of behavior, laws &
regulations, patterns of organization that are widely accepted are

termed Institutions. They are seen as providing a stabilizing
framework for social and business life. They are 'the way things are
done'. Often, this bundle of behaviors and accepted norms is termed
'culture'. (DiMaggio and Powell, 1983; Meyer and Rowan, 1977).

Institutional Isomorphism

Every firm sits inside a context. Every firm must share characteristics

with its context and adapt to changes if it is to survive. The process of

55
©Business Games Works 2018 (Version 1)