Friday, November 18, 2011

Social Complexity Theory as a framework for new economic models


I have just learned from my brilliant friend Ron Schultz that he's the co-author of another book on complexity in the context of business. It is called "Coherence in the Midst of Complexity"
In my conversation with him, I learned that the ideas outlined in his book would most definitely apply in my field. I gathered that anyone who shares my passion for advancing the new frameworks in the fields of Sustainable and Responsible Investing would benefit from seeing the world through the lens of "coherence in the midst of complexity."
Here's an overview of Social Complexity Theory from the book's website.
"Complexity and emergence (the appearance and impact of the new) can be the bane of managers and their organizations. Both complexity and emergence threaten to upset adherence to predefined categories, which supposedly allows for efficiency. Indeed, traditional management thinking focuses on a retrospective coherence where ideas and events are assigned to categories, the categories are labeled, and outliers are treated as statistical deviants.  
"The study of how such attributed (retrospective) sense-making breaks down in and around organizations is the focus of social complexity theory. Coherence in the Midst of Complexity discusses the social complexity approach, where dialogue and stories allow for the degrees of freedom needed for the opportunities of emergence to take root. The book focuses on the experience of coherence and how such experiential lessons differ from the establishment and maintenance of categories and labels."
"Social Complexity Theory examines the role of coherence and emergence in organizations. Coherence is regarded by many psychologists as critical to day to the day productivity and effectiveness of individuals. Both scholars and managers have adapted this belief to the world of management and organizations. Coherence is regarded as a sign of a well-run organization. But, the concept of a coherent thought defined as how well an idea holds together as a single entity gradually breaks down as the scale shifts to individuals, groups, and ultimately larger organizations. 
"Adapting to and dealing with emergence is perhaps the most important task facing managers and organizations. Coherence as traditionally defined interferes with that task. By restricting the concept of coherence to measurement against definition (what we call ascribed coherence) managers and organizations implicitly are restricting their ability to deal with the unknown, the uncertain and the emergent." 
"Social Complexity Theory provides another perspective on coherence -- rooted in the felt experience of coherence and in the importance of emergence. Richard Rorty tells us: Knowledge is not a matter of getting reality right, but rather a matter of acquiring habits of action for coping with reality. In common parlance such coping mechanisms are called models. The aim of Social Complexity Theory is to teach managers and members of organizations to make use of some very different models as part of their coping mechanisms."

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