Complexity Science Meets Business

This company is going some very cool stuff. Here is some relevant info pulled from their site.

The classical approach to business analysis is reductionism, which examines a system by taking it apart and understanding its constituent elements. This approach works well for many phenomena both in the business and natural worlds.

Traditional business analysis is being revolutionized through complexity science. Complexity science is the study of systems composed of many and varied parts that interact in complex and non-linear ways. Complexity science recognizes that such systems cannot be understood simply by understanding the parts – the interactions among the parts and the consequences of these interactions are equally significant. Icosystem looks at business environments in their entirety, recognizing that they are more than the sum of their parts. This fundamentally new approach often yields deep new insights into the ecology of business sectors and the opportunities that can emerge.

Then there is the discussion about buttons that makes an excellent point.

Imagine a pile of buttons is placed on a table. Select two buttons at random and join them up with a thread and continue this selection and joining process. Now imagine that after each operation we examine the clusters of buttons that are joined together (i.e. if we lift a button up, how many come with it?) and note the size of the largest cluster. If we do this many times and plot the results, what we see is the following relationship between cluster size and the number of threads.


We can see that the "pay-off" for investing in one more connection is highly dependent on how many connections have already been made. If instead of thinking about buttons we now think in terms of people or companies, we can see how an understanding of the network effects of our actions can help us choose which connections are most appropriate for our objectives and hence stay on the most productive part of the S-Curve.

This is what I mean when I say that business decisions and analyses aren't black and white. It all ties together. If people ever begin to embrace the concepts preached by Icosystem, it will change the way business is done.

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