The theory of practice

The actual forms that the purposes of companies, organizations and institutions and their planning, organization, implementation and control take are many and varied. Yet the nature of their functioning is always the same! Stafford Beer has represented it in the Viable System Model (VSM). This is the model that shows what organizations that are viable and capable of evolving, and the parts of their physical, natural and social environment that they interact with, do in practice.

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"I hadn't the slightest idea I was managing cybernetically!"
Moliére has Monsieur Jourdain, the bourgeois who wants to become a gentleman, go into raptures of delight when his professor of philosophy reveals to him the difference between prose and poetry. Jourdain, who wants to make a good impression on a lady in the higher levels of society by the quality of his education, reacts with totally immoderate enthusiasm to the fact that he has always been able to speak prose without ever knowing it. In the same way, in connection with the application of cybernetic principles, there are a large number of managers who have "always done that", without knowing that their way of thinking and behaving was in accordance with the findings of cybernetics. This science has actually studied under what conditions complex systems function most satisfactorily. It has, so to speak, looked for and found the right theory for practice. It will therefore come as no surprise that practitioners, in particular, reach the same conclusions as the cyberneticists, even though they may perhaps not have formulated them in such precisely scientific and abstract terms.

Everything at the same time everywhere
To manage structures, processes, results, experiences, and the past, present and future, in real time. That is what is actually being demanded of managers today. There have always been small companies, but also very big companies or even single units within them, that have managed to do that, and there will always be ones that do! The VSM shows why.

Boosting intelligence rather than strength
Conventional models of organizations, such as organizational charts for example, are typically of a mechanistic and linear nature. What are organized are activities, on the principle of building greater strength. This typical way of thinking becomes apparent all along the hierarchical line in the form of ideas of "more staff", "more resources", "more power" and of making it impossible for the individual to take any personal responsibility. Customers, partners, society and other aspects of the world outside the organization, on which is it dependent and with which it interacts, are ignored, as if they had no effect on what happens to the organization and what opportunities it has.

What marks out the Viable System Model is its organismic or biological nature. The goal that is pursued is the organization of flows of information and knowledge - the boosting of intelligence. The contribution the individual makes is of major importance. Between the "base" and the "apex" there are systematic recursions or feedbacks to give a balance between the levels of the hierarchy. Instead of a "command and censure" hierarchy, what is formed is an ordered pattern to the supply of the information that is needed for effectiveness at all levels of an organization. Customers, partners and society, or in other words all the aspects of the world outside the organization on which is it dependent and with which it interacts, are integrated, because they do indeed have an effect, often an enormous one, on what happens to the organization and what opportunities it has. It is hardly possible to pretend this is not the case. It is something that has to be taken account of because otherwise a person is not in control but is being controlled.

What I would like best would be to do everything myself ...
How many good managers are there in big organizations who are simply not permitted to despair at the fact that they cannot do everything themselves? The despair arises from the fact that they would be capable of doing it themselves, but are dependent on human beings who have to be trusted to be equally capable of doing it. What they can do is to provide these people, as quickly as possible, with the requisite information that they, the managers, have acquired by seeing things from their own point of view. In other words, everyone in the organization has to be able to see the point of view taken by his manager at all times. The ideal state is for everyone to know the points of view of everyone else sufficiently well to be able to orient their own behavior to the larger whole. The ideal model for this is the human being himself. He knows everything that he knows. He perceives everything that he perceives. He decides everything that he decides. What is possible for him is precisely what for him is possible, and so on.

Effective organizations operate like effective human beings
Research into the way in which living systems, and particularly nervous systems - the biological communication systems - function, formed part of the basic work done by the pioneers of cybernetics. To Beer, it was therefore perfectly obvious to take the human organism as a model in his search for the most effective organization. He was to find ample confirmation of the wisdom of this step. No question that might be asked about the most effective organization now remained unanswered. The Viable System Model gives an exact description of the functioning of systems that are viable, i.e. capable of living, it is a law of nature.

The law of viability
To be considered viable, a system has to be capable of adapting to its constantly changing environment. It has to be capable of preserving its identity and assimilating and making use of its experiences; it has to be capable of learning and of continuing to develop.

Hence, the criteria that Beer formulates are absolutely contrary to those normally laid down by most other people: the goal should be not the maximizing of profit but survival. What is crucial is not the management of people but the direction or control and regulation of entire organizations in their environment. It is not that a few people should manage but that all the people need to perform certain management functions.

With his Viable System Model, Beer organizes people, the tasks they are given and the tools they use in such a way that they can each draw support at any time from the orientation, information and points of view they need. Instead of the fondest desire being to do everything oneself, what comes into being is the configuration for an information network which makes self-organization possible and thus ensures that everyone can do for himself everything that is necessary in his own area!

Everything and everybody are (at) one
If someone looks at the drawing of the VSM without knowing what it represents, it perhaps brings to mind more the electrical circuits or switchboxes in a machine or in a building than an organizational model patterned on the human organism. If, however, the flow in the "circuits" is looked upon as a flow of information and knowledge and the effect they have as the effect of the five functions that are crucial for effectiveness, then it will soon become clear what it is that Beer depicts in an abstract form in his Viable System Model: he reveals the "circuits and switchboxes" in the information network of the organism. To be more exact, however, what is revealed is a power-station on an information network, because it connects together in organizational terms all the resources, actions, pieces of information, handling processes and results together with all the transformations that these things involve.

These "circuits" ensure that the individual "cells" or smallest units, the individual "organs" or performers of functions, and the individual "organ systems" or functional areas are supplied and co-operate as a whole. Effective co-operation within the organism then comes into being simply and straightforwardly through EVERYTHING together in simultaneity or, to use the technical term, in real time.

The organization then operates like a single effective human being. The VSM can therefore be applied just as well to any kind of company, organization or institution as to individual people. As a person, a successful individual entrepreneur, say, embodies a VSM, but so too does his entire firm if he has set up effective organizational structures.

However, the same configuration can also be found in the largest organization that is capable of existing as an independent entity. And, many other systems in organizations which need to be capable of evolving can be configured in accordance with the VSM - what comes to mind is the architecture of computers or software, for example. What is more, all the other effective resources serve to organize one or more of the five crucial functions.

Holism and what it really means
The VSM is the organizational model that is genuinely holistic. Metaphorically speaking, its application might be compared with holistic medicine - but medicine for organizations rather than for organisms. Prophylactic health care is the primary concern; rather than treating individual symptoms, trust is placed in regulation of and effect on the whole.

Matter, mind and psyche operate as a unit. If they are separated in the human being, for example, the person before one is either unconscious or a corpse, is either able to speak or has no sensations. There are good reasons why, in transplant surgery, everything hinges on speed, accurate connections and absolute compatibility - an organ detached from its parent organism remains viable for only a few minutes. However, in organizations it quite often happens that individual organs act as if they were solitary and self-sufficient and there is an analogy that can be drawn when this is the case. If, in an organism, one organ were detached from all the others but were not removed from the organism itself, the latter would treat it as a foreign body and it would act as a foreign body: the detached organ would degenerate and the products of its degeneration would hamper, obstruct and, in the end, poison the organism. Analogies like this occur almost as a matter of course in the everyday language of many people in gainful employment. However, orienting oneself to the VSM in setting up effective organizations is not, as yet, as much a matter of course as it might be.

The architecture and configuration of the VSM
Aspirin in medicine has some amazing systemic and, above all, stabilizing effects, not all of which have yet been fully researched, starting with the relief of pain and ranging on through lowering of fever, checking of inflammation, prevention of heart attacks, strengthening of immune reactions and so on. The five crucial functions of the VSM act in a similar, holistic, way in each "cell". They are connected together in the same way as the various organ systems in the human being and, putting it in simplified terms, are responsible for performing the following tasks:

  1. Doing things
  2. Coordinating
  3. Optimizing
  4. Observing and drawing conclusions
  5. Deciding on and keeping track of values and ensuring identity.

Stafford Beer calls these five functions Systems 1-5. System 1 stands for what is done in the organization and System 2 for how it is coordinated. System 3 stands for operative corporate management, System 4 for strategic corporate management, and System 5 for normative corporate management. The simplified colored graphic of the VSM that is shown here will make this clear:

System 1: Operations

System 2: Coordination

System 3: Optimization

System 4: Development

System 5: Valuation

The blue boxes and lines stand for everything that is done in the organization, i.e. for its operations.

The yellow boxes and lines stand for all the activities and resources involved in the coordination between the operative units.

The red boxes and lines stand for all the activities and resources that bring about the optimizing of the operations of the individual systems.

The green boxes represent the environment of the organization, the parts of it that are worked on by the individual operative units of the organization, and all the activities and resources that serve to observe the environment and to gain experience from it and to allow strategies to be developed for the future.

The violet boxes and lines stand for all the normative rules and regulations that apply in the organization, such for example as the entrepreneurial ones relating to the creation and safeguarding of both identity and quality, the ones relating to ethical attitudes and to statutory and contractual provisions, and the ones relating to mandatory instructions.

What is responsible for linking together the five functions named above is a precisely defined configuration of interconnected, information loops that convey the following kinds of information generated from and by management activities:

Information on what the operating systems are doing.
Information that passes between the operating systems and what is directing them.
Information that all the operating systems generate from those parts of their environment with which they interact.
Information that is used to ensure coordination between all the operating systems.
Information that is used to optimize the operating systems.
Information from the environment and from the organization that is important to development in the organization and of it.
Information of a normative nature.

To link these types of information together, a network, as in the organism, is needed, which in its components are a duplicate of the architecture of the VSM:

In the same way as an individual cell carries within it all the information on the entire organism, so too in viable organizations is the architecture of the VSM repeated in the same pattern on every level and in every unit, though there may be very wide differences between the actual forms the parts of the architecture take. At a recursion level, for example, a coordinating element may be a duty roster, while at a higher level it may be someone who draws up a duty roster for the staff and at a lower level it may be a report on a duty performed.

The VSM defines the set of rules for effective organizations
The architecture and functioning of the VSM form a set of rules that are present at every level of the hierarchy and at every level at which matters have to be considered and actions have to be taken. In other words, every optimum VSM contains as subsystems other VSM's that in turn contain other VSM's as their subsystems and so on. It forms as it were a fractal architecture in the same way as a cauliflower, a fern or a snowflake. This sounds fearfully complicated at first. However, if the five crucial functions are thought of by their altered but still basically correct names: do, coordinate, optimize, observe and draw conclusions, and decide and follow up values and ensure identity, then it will seem obvious, because it is what any effective human being does anyway. Also, it is what human beings have to do outside their individual spheres in the organizations that together they form, design and use.

Why individual units can be effective even in an ineffective organization
The VSM also explains why it is that some individual units, be they entire teams or individual persons, can be highly effective in organizations, whereas others and the organization as a whole are not. If the VSM is used to look for the things that are crucial, it will be found that all of them are present in the effective units but not in the others. If just one of the crucial functions is missing, this in itself is enough for effectiveness to suffer as a result.

Diagnosis, regulation, design and development of complex systems
Structures are processes that change slowly and processes are structures that change fast. The structures and processes that are crucial to the ability of organizations to exist and thus the necessary prerequisites for viable and effective organizations of every kind are represented in the VSM in such a way that the difference between human, technical, and cognitive functions and tools dissolves. The Viable System Model can therefore be enlisted in the service of the analysis - Stafford Beer prefers to call it the "diagnosis" - regulation, design AND (!) development of complex systems.

Getting ahead of time
There is much that happens simultaneously in and in relation to every organization. What manager has never said that he can't be everywhere at once? In the VSM, Stafford Beer maps out structures, processes, results, experience, and the past, present and future as a unit. The information loop shows how they have to be managed in real time. There is no need at all for the manager to be everywhere at once! All that has to be ensured is that the relevant information reaches everybody at the same time and that everybody is able to reach the relevant information.

This being the case, the five crucial functions control, regulate and communicate in the temporal dimension from three different viewpoints:

Systems 1-3 concern themselves with what is happening here and now.
System 4 concerns itself with what might happen in the future.
System 5 concerns itself with what is always to happen.

None of the systems concern themselves with the past because there is no need for them to. The things that are relevant from the past are operating in the present anyway, and in the same way all the decisions that are applicable from the past are operating in the present and will continue to operate in the future. Because of the effective, fast and short paths that information follows, there is no timeframe from the past that has to be dealt with.

The Viable System Model is not an organizational chart!
What the VSM shows is that the effectiveness of and in organizations comes from a very specific structure made up of very specific functions and pieces of information. Many people who are confronted with the VSM for the first time think that they are being faced with an organizational chart. The opposite is in fact the case: effective organizations come into being as a result of deep structures that are located not in the organizational charts but "behind" them. Organizational charts are therefore not a good way of understanding how systems work.

A model for the smallest cell to the biggest company
On an abstract level, a single living biological cell has the same functional mechanisms for regulation, control and communication as are described in the VSM. The bird's-eye view of the VSM shown below reveals how amazingly similar it is to a cell.

The Viable System Model describes the crucial capabilities that constitute the viability of cells, organs, organisms, human beings, teams, companies, organizations, associations, institutions, corporate groups, international bodies and so on. The difference lies simply in the actual forms these capabilities take. In organizations, the Viable System Model can be used as a means of analyzing or diagnosing, designing, regulating and developing all the systems and subsystems that are present.

You can learn more about the subject in an article entitled The law of nature of effective organization, which is available to download as a PDF file.


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