Systemic Choices: Nonlinear Dynamics and Practical Management - Review

Administrative Science Quarterly,  June, 2001  by Leonard H. Friedman

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Gregory A. Daneke. Ann Arbor, Ml: University of Michigan Press, 1999. 277 pp. $42.50.

Like the field of medicine, management is often thought of as at least equal parts art and science. Both disciplines attempt to understand the interactions among the various parts, structures, and units, further complicated by interactions with the external environment. This idea of the organization as a system is central to this book. These systems operate in a manner that is often hard to predict. In the introduction, Daneke states, "In an era of increasing turbulence and surprises, nonlinearity--which is the science of surprise, should be a vital element of any social inquiry, particularly those which purport to improve practical policy and management." It is this concept of nonlinearity that is the unifying theme of the book. Daneke works to make the case that conventional (albeit widely accepted) notions of economics, decision making, and organizational theory fail to adequately explain how complex organizational and social systems operate. To use his words, "the theme of the book is that nonlinear metho ds and metaphors as applied to social phenomenon represent a restoration of the ideals of systems theory" (p. 18).

The book's nine chapters build on one another such that the underlying theory and assumptions are used to support the conclusions and recommendations found at the end of the work. Chapter 1 describes the rationale and sequence of ideas covered in the book. Concepts of chaos and complexity theory are the basis for the case Daneke makes for a new way to think about management and social systems. The second chapter expands on these ideas of chaos and complexity, providing a thorough examination of how these concepts complement one another. Chapter 3 examines nonlinear systems through a variety of different lenses, including cellular automata, fuzzy sets, artificial intelligence (Al), evolution, and game theory. Next, Daneke critically revisits systems thinking and takes the reader through the development of general systems theory, systems dynamics, and cybernetics, carefully chronicling the systems thinkers originating in Europe. Central to this chapter is the notion of self-organizing systems and how bounded ra tionality fails to be of much help in explaining these types of systems. Chapter 5 takes these nonlinear streams and works to create something Daneke calls an institutional ecology. Borrowing from the concept of ecology in the life sciences, he envisions organizations and social systems as moving from a pure resource dependence perspective to a more holistic state in which everyone is dependent on everyone else for survival and growth.

Chapter 6 begins to develop a new praxis, or blend of theory and practice. Daneke uses the example of the practices of Japanese management (brought to popular attention in the 1980s) as the starting point for a discussion of an evolution from an old to a new systems perspective. That new perspective involves the processes of self-organization, learning organizations, and continuous quality improvement as the nonlinear backbone for organizational and social systems. In chapter 7, Daneke attempts to demonstrate how nonlinear principles can be applied to actual management situations, using financial management as the realm in which these practices can have the most dramatic impact. Coupled with this application is a discussion of the importance of mental models as a means of coming to grips with nonlinearity. Chapter 8 uses the ideas of complex nonlinear systems to help explain how a myriad of microinteractions (usually at the individual level) helps govern the activities of macrostructures. Daneke uses the exam ples of business cycles, technoeconomics (beyond just e-business), and the movement into an information-based economy as evidence of how these interactions play out in real time. In the final chapter, he builds toward an institutional ecology of ecological institutions. The various currents of nonlinear thought, particularly that of ecology and holism, are used to think in global terms as organizations look to global adaptiveness, sustainable development, and the emergence of the "green' marketplace.

Overall, the book has great value for scholars of organizations from several perspectives. The book is exhaustively researched and referenced. Daneke does a good job of integrating a number of divergent yet interrelated theories to build the case for the importance of understanding nonlinear systems. Finally, rather than being just a recapitulation of the work of others, Daneke demonstrates a good understanding of how these ideas can be applied in organizations and social systems. All of this said, I found myself having to read and reread the same sections repeatedly to fully understand the point that was being made. While the theme expressed early on consistently ran through the text, it was not until the second half of the book that the ideas began to make good sense. The first half is a thorough but not terribly inspiring literature review in which I found I was forcing myself to plod onward. Only in chapter 5 do readers truly begin to understand the power of nonlinear dynamics, systems thinking, and ecolo gical perspectives of organizations so that by the time they arrive at the ninth chapter, all of the previous material makes perfect sense. I only wish that I were as enthusiastic at the beginning as I was at the end of the book. But, overall, this book is an important addition to the scholarship of systems thinking and learning. My hope is that the lessons contained in it will filter down to those who engage in the actual practice of management. That is where the greatest value for these ideas will be obtained.

COPYRIGHT 2001 Cornell University, Johnson Graduate School
COPYRIGHT 2001 Gale Group