9. Systems Thinking and ‘Ashby’s Law of Requisite Variety’

Systems thinking has been used in many fields, from medical, environmental, political, economic, to educational. There is an increasing appetite for it in a world facing complex issues which exhibit uncertainly, ambiguity, emergence, and non-linearity. There is a zeitgeist to reject the linear model approaches which have dominated since the beginning of the third industrial revolution. There is increasing acceptance that everything is connected ecologically and interdependently; that actions in one area frequently lead to problems in another.

This is supported by other system thinking concepts such as ‘Ashby’s Law of Requisite Variety’ (1968) which governs the capacity of a system to respond to changes in its environment, and implies that only variety can absorb variety. Simply, ‘it is not possible to address any problem by addressing just one facet” (Kirby & El-Kaffass, 2021).

In a nutshell, Ashby studied organic systems. He became aware that the organisms that had the most flexible responses to problems that confronted it were more likely to survive.

This seems at odds with the management principles of the 20th century that essentially seeks to reduce variation in all its forms. Production lines are built to create a duplicate of machines; Agriculture creates enormous fields with single crops; Management builds hierarchies where only the individuals at the top have access to all the information.

The problem with this 20th-century approach to management is that a single problem in the manufacturing process makes the entire output of a factory valueless; a single disease can wipe out entire crops and hopeless management can steer the organisation onto the rocks.

As has been demonstrated in the research on the impact small ventures had on job creation: 50% of employment was created by a mere 4% of new ventures (Bolton,1971; Storey 1994).  It is likely that a multitude of smaller agile innovations is the wisest strategy in resolving the issues illuminated by SDGs. No one solution is likely to work.

Harmonious Entrepreneurs/value creators work in collaboration to form a coopetition a process where entrepreneurs cooperate for the benefit of the system while competing for custom (Park et al, 2014).

Ashby’s Law: “when the variety or complexity of the environment exceeds the capacity of a system (natural or artificial) the environment will dominate and ultimately destroy that system”. Consequently, in order to deal properly with the diversity of problems the world throws at you, you need to have a repertoire of responses which are (at least) as nuanced as the problems you face.

The SDGs that Harmonious Entrepreneurs/value creators seek to resolve therefore require more complex thinking than simple analysis. This is because often quick hacks cause knock-on effects on the broader system. And these cures can end up being worse than the disease. Harmonious entrepreneurship is based on systems thinking, and as such, recognizes the interconnectivity of the ecosystem, working to integrates or harmonises the eco, the social, the humane, and economic, creating a 21st century model for successful business and value creation that is intended to help save our planet.

Not taking a ‘systems thinking’ approach is often the reason why good endeavours fail or fail to be sustainable in the longer-term – the solution of one problem may create another. In accordance with Ashby’s Law of Requisite Variety, this interconnectivity requires that if entrepreneurship is to help ameliorate the ‘Sustainability’ problem it must address each of the connected elements together, rather than separately.

Next, listen into the summary video of ‘Requisite Variety’ below.

References

Ashby, W.R. (1968). ‘Variety, constraint and the law of requisite variety’. In W. Buckley (Ed), Modern systems research for the behavioural scientist. Chicago: Aldine Publishing Co.

Kirby, D.A. and El-Kaffass, I. (2021), “Harmonious entrepreneurship – a new approach to the challenge of global sustainability”, World Journal of Entrepreneurship, Management and Sustainable Development, Article publication date: 12 July 202. https://doi.org/10.1108/WJEMSD-09-2020-0126

Park, B.-J., Srivastava, M. K., & Gnyawali, D. R. (2014). Impact of coopetition in the alliance portfolio and coopetition experience on firm innovation. Technology Analysis & Strategic Management, 26(8), 893-907.


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© Harmonious-Entrepreneurship.org (2021)

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