Management information systems and organizational worldviews

Management information systems reflect and control an organizations outlook on its 'world'. They control and steers information, incentives, the interpretation and filtering of information, affecting strongly its reaction on environmental and internal developments. 

They are causally related to the success or failure of innovative approaches and products as the filters used in determining 'key performance indicators' influence perception and interpretation of new markets and revenues.

These are usually handicapped relative to established markets and products. Nevertheless, again and again established players are superseded by new entrants as they discount information and chances that new players used to build franchises based on their 'attackers advantage'.

How to deal with business complexity?

Business and state organizations face today a multitude of historically grown complex structures on which they depend for execution of processes. Examples range from technical infrastructure for communication to regulatory rules operating in bureaucracies. At the same time technological and associated social changes demand increasing speed, flexibility and adaptability of organisational structures and processes. How to cope with this situation that puts increasing stress on economic, social and political members of advanced and less advanced societies?

In the past numerous re-engineering projects have been executed to cut down on the jungle of organisational processes with limited success improving short-term figures, often creating images of short-term or even fake successes (e.g. through rules put into accounting systems) and increasing stress and susceptibility to failures. What if the jungle is a complex eco-system of organisational processes whose relations have been insufficiently understood and messed with?

The 'obvious' solution is to rationalize historically grown large scale organizational systems in meaningful ways by streamlining their structures based on an organic understanding of the important interlinkages among their 'modules' and their historic development. This view subsumes and at the same time limits a rational, analytic view of the world (as will become clear in the section on the decomposability of systems).

However, what that obvious solution entails is less clear. The above description entails a number of value judgements, whose resolution can only be based on very generally principles to be most widely acceptable. One of these values should be the long-term survival of the enterprise. Depending on the regulatory environment that entails a certain level of risk acceptable for an organization, which is related with specific degrees and processes of change.

The answer to the issue depends on our model of the world and its development. Fusing economic and evolutionary views, economic survival and even more economic success is about the realization of new chances and optimization of existing structures, i.e. two forms of adaptation. Competitive advantage as ex-post measure of 'realised' economic fitness is a relative measure of how an ensemble of organizational modules (e.g. departments, business units, legal entities) with certain characteristics that work better than other such ensembles (together).

The development of a complex systems, such as organizations, is a path-dependent build up of complex forms of organization glued together by information flows. The organizational build up takes places through learning about what does not work in markets captured in hierarchical structures and controlled by regulation of information blocks in modular components. It is based on an evolutionary process of learning about what survives in 'the environment' and reflection in organization characteristics, which is followed by a subsequent optimization process that leads to a more or less heterarchical entanglement of structures and processes.

Organizations can thus formally be seen as hierarchical systems with departmental modules that allow execution of functions through specific capabilities concentrated in particular departments. This confers economies through separation of work but also leads to interpretation and filtering problems in non-standard or changing situations as interpretative blindness and inertia are fostered. Therefore, (informal) organization structures need to be heterarchical in order to cut across departmental and disciplinary boundaries to successfully deal with the increased complexity and speed of change. This requirement is reflected in informal structures, which change the seemingly simple, modular hierarchy to a heterarchical form interlinked across hierarchical levels. Heterarchical structures allow faster and broader interpretation of information, but also demand higher interpretative capabilities by management. Given process and product related capabilities, these interpretative capabilities ('dynamic capabilities') determine to a large extent the success of an organization.

Scientific method: fundamental truth vs. fluid knowledge

In the discussion of Planck and Mach, it should be considered that Mach was an empiricist, who had partly auto-didactically trained himself before his formal education and furthermore trained in a handicraft as a woodworker, while Planck was of a theoretical bend, declining for himself the 'need' to do empirical research. This seems important as Mach brings the experience of trial and error, tinkering or 'bricolage' to his theoretical and metaphysical views of (the development of) science.

Planck disagrees with his interpretation of Mach's historio-critical view of science at the beginning of his (Planck's) "Survey of Physics" because Mach tries to build his concepts of (physical) science on the notion of fluidity of human knowledge and the limits of models made up by (wo)man, which Mach sees as a currently 'valid' thought economic conceptualization of the known facts (and supporting assumptions resp. theories). Planck understands these as 'more or less arbitrary' constructions (which, I think, they are not as they are historically developed and take account of the currently known facts 'arranged' under the needs of specific world-views of scientists).



Furthermore, Planck disagrees with Mach's basing science in sense-perceptions (which are nevertheless deemed a useful starting point and correction to former exaggerations based on physical research results), but favors a view based on the 'constancy' of the properties of reality, a constancy which persists through all individual and historical interpretative variation. If I am not mistaken (pls. correct if I am wrong) Planck favors a statistical approach to (re-)searching these constant properties of reality, e.g. endorsing Boltzmann's thermodynamics in this context.



(N.B.: To me it seems Planck reduces the notion of Mach's perception complexes, which link properties of reality and their representation in the mind through mutually dependent functional complexes. Even if we use 'modern', extended sense-organs such as microscopes and Large Hadron Colliders, these measurement instruments can, just like our senses, only react to and register what they are 'designed' and constrained to capture - which leads us to issues with particle-wave dualistic appearances of entities.)



In contrast, Mach uses the 'historic-critical method' developed by religious scholars at the University of Tübingen, who put statements from the bible in their historical context, see e.g. his "Science of Mechanics. A Critical and Historical Account of its Development."

 As indicated above, Planck sees the world differently, where the standard of scientific research should be to strive for 'a fixed world-picture independent of the variation of time and people'. He argues that (physical) theory can be built on more 'fundamental' and unchanging concepts such as his Planck constant. Science should (can?) derive fundamental, stable statements or truths in his view.



I do see how Planck's approach works for abstract constructs as theoretical *pictures of the world* - one can build axiomatic, theoretical systems that capture (or seem to coincide with in a more critical reading) observed facts. However, I do not see how this works on a larger scale of several generations of practical researchers and theorists building their theoretical systems based on what they deem fundamental facts - which usually tended to change over the human history of science (which leaves us with the question: are Planck's constants and constancies subject to change?).