Topics: Feedback, Viable System Model, Cybernetics Pages: 25 (9353 words) Published: December 4, 2012
Explaining Modern Management Approaches by Cybernetic Principles and Some Implications by Dan Trietsch MSIS Department University of Auckland Private Bag 92019 Auckland, New Zealand

Abstract Managerial cybernetics, using Stafford Beer’s cybernetic model (which dates back to the early seventies), more recently known as the viable system model (VSM), calls for designing nested hierarchical organizations where every viable unit in the hierarchy is autonomous as much as possible, but is also subject to some controls from its upper management metasystem. Said metasystem represents a more general level of the hierarchy. The functions of this control include damping of oscillations between the subunits (operational control), coordinating activities of subunits to achieve synergy for the whole (management control), strategic planning (i.e., deciding how the organization should evolve and address changes in the outside environment), and overall coordination and balancing of management control decisions with strategic ones. Beer argues that such a structure is necessary for survival. Indeed, it turns out that some modern management techniques and philosophies can be interpreted as partial applications of the VSM. For example, small JIT (i.e., kanban), CONWIP and Supply Chain Management can be viewed as damping oscillations and providing some management control functions. Management by Constraints (MBC) and PERT/CPM -- MBC’s older isomorph -- can be viewed as variety attenuators and amplifiers -- concepts that are key to the VSM -- and their function, again, is to support operational decisions. The function of strategic planning is closely associated with the modern concept of learning organizations. Similarly, participative management supports both functions and provides proper amplification of upper hierarchy decisions. Since Beer’s assertion that these functions are vital is supported by modern practice, it may behoove us to study in some detail parts of his model which have not yet been implemented satisfactorily: they may provide significant opportunities. Emphatically, this includes the correct role of information systems.

Cybernetics, Greek for "steersmanship," was defined by Norbert Wiener as "the science of control and communications in the animal and the machine." On the one hand, as Wiener argued, for our purpose we can think about animals (including humans) as machines (created by god or by nature), albeit more advanced than the artificial machines we fabricated to date (Wiener, 1954). This implies that it’s conceivable for (some) artificial machines to behave in what appears to an observer to be a purposeful manner. For example, Ashby’s Homeostat may be said to do so (Ashby, 1960). It also implies that (some) artificial machines can be designed to build other artificial machines, including models more advanced than themselves; this claim, Wiener reports, was proved mathematically by Von Neumann. On the other hand, systems of machines, e.g., populations and organizations, are also [compound] machines, and it was with this insight that Stafford Beer pioneered the application of cybernetics -- which already had wide application in engineering -- to management. Hence, managerial cybernetics is the science of control and communications in human organizations (Beer simply called it the science of organization). "Control" does not imply coercion: rather it includes any method by which the system maintains its viability. "Communications" includes any transfer of data, information, directives, etc. Thus, managerial cybernetics spans management (control), communications, and information systems. Particularly, it provides important connections between operations management and information systems (IS). It also has major implications for accounting and for human behavior issues, but those are outside our focus. That Wiener chose to include both control and communications in his framework...
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