Systems theory

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If you had a population that were miserable and restless because they had nowhere bearable to live, the preferred solution seemed not to be spending money on improving their conditions, but on hiring more police in case things turned ugly.

Alan Moore, Jerusalem

Systems theory eschews the reductionist, deterministic, “scientific” disposition and views the world in terms of inter-operating systems. That is to say, it treats the ordinary interactions of life as complex and not merely complicated problems to solve; as interactions of and between systems. System interactions are necessarily complex in that they are not finite, they are non-linear, and the rules of engagement nor information about the system are neither complete, coherent nor static.

Systems are comprised of stocks, flows, and feedback loops. Good primer is Donella H. MeadowsThinking in Systems.

Complexity Theory

Organisational systems can be simple, complicated or complex. Best you know which one yours is. Differentiate between the type of system and how to manage that system. So:

System System characteristics How to manage Example
Simple system Static process. Requires a series of steps. No interaction. Little if/then logic. Fixable (and best handled) by algorithm. Unskilled application of algorithm. Suitable for machine production. Bake a cake.
Complicated system Bounded interactive process: Involves interaction with an autonomous/uncontrollable agent but boundaries are fixed, and rules of engagement are static fully specified, known to all participants. All relevant information is available to all participants. Skilled application of algorithm. Suitable for autonomous operation by subject matter expert. Chess or Go.
Complex system Unbounded, interactive process. Involves interaction with automonous agents without boundaries, without pre-agreed rules, and where information is limited and asymmetric. Rules, boundaries and each participant’s objectives are dynamic and change interactively. Impossible to predict. Requires expertise, experience, autonomy, imaginative adaptability, heuristics, and the ability to make, adjust and reject provisional conclusions as information changes. Financial market. Manufacturing process. Air traffic control system.

Simple systems

Simple systems: simple systems are situations where essentially inanimate objects interact with each other in ways that are fully understood. Lego is a simple system. So is a cake recipe, or a bungee jump. The components of a simple system don’t fight back. Simple systems are therefore predictable. They can only go wrong if components fail or you don’t follow instructions. In either case they fail in predictable ways. As such, simple systems are suitable for checklists,[1] recipes etc, where algorithms can overcome the hubris that will surely rain down on the heads of those who treat simple processes as trivial. Disinfecting your instruments before performing heart surgery, for example, is a simple step to take, but not a trivial one.

Examples

Common simple systems and what happens when they go wrong:

  • A cake recipe: cake doesn’t rise.
  • (theoretically) A negotiation playbook, with comprehensive escalation procedures (it’s really a disguised complicated system)

Complicated systems

Complicated systems: Unlike simple systems, complicated systems require interaction with autonomous agents whose specific behaviour is beyond the user's control, and might be intended to defeat the user’s objective, but whose range of behaviour is entirely deterministic. Each autonomous agent’s range of possible actions and reactions can be predicted in advance. At least, in theory.

For example chess — or, for that matter, any boardgame or sport.

Complicated systems therefore benefit from skilled management and some expertise to operate: a good chess player will do better than a poor one — a school-leaver from Bucharest with plenty of coffee and a playbook on her lap probably isn’t the droid you’re looking for — but in the right hands can usually be managed without catastrophe, though the degree of success will be a function of user’s skill and expertise.

You know you have a complicated system when it cleaves to a comprehensive set of axioms and rules, and thus it is a matter of making sure that the proper models are being used for the situation at hand. Chess and Alpha Go are complicated, but not complex, systems. You can “force-solve” them, at least in theory.[2] They are entirely predictable, determinative and calculable, given enough processing power. They’re tame, not wicked problems.

Examples

Common complicated systems and what happens when they go wrong:

  • Music performance: flying rotten cabbages; no encore.
  • Chess, Go, Poker, Bridge: other guy wins.

Complex systems

Complex systems: Complex systems — also known as “wicked problems” — are dynamic, constantly changing, unbounded, incomplete, contradictory, and conflicting systems consisting of an indefinite set of subcomponents that interact with each other and the environment in unexpected ways. They are thus unpredictable, chaotic and “insoluble” — no algorithm, heuristic or solution can predict how complex systems will behave in detail. You may apply probabilistic models to them and these will work passably well most of the time, but the times where it won’t — the extreme cases — will be exactly the times you really wish it would, as the founders of Long Term Capital Management would tell you. Complex systems may comprise many other simple, complicated and indeed complex systems, but their interaction with each other will be a whole other thing. So even while you may manage the simple and complicated sub-systems effectively — deploy checklists, simplify, homogenise — and this may limit the total damage a tail event may cause, but you cannot eliminate it. Accidents in complex systems are inevitable — hence “normal”, in the Charles Perrow’s argot. However well you manage a complex system it remains innately unpredictable. It will do unexpected things. Like blowing up. So have your plans for dealing with those normal accidents.

Examples

Common complex systems and what happens when they go wrong:

  • Nuclear power plant: Chernobyl, Three Mile Island and Fukushima
  • The environment (and any naturally selecting ecosystem, really): Covid-19; global warming
  • Air traffic control system: Name your air crash but two classics are Air New Zealand’s Mount Erebus disaster and ValuJet 592 This is a fantastic article about the latter.
  • Financial markets: Take your pick: LTCM, Enron, Global Financial Crisis
  • The world wide web:

See also

References

  1. See: The Checklist Manifesto.
  2. Do you hear that, Daniel Susskind?