Managers are often required to respond in adaptive ways to the threats and opportunities presented by rare, extreme outcomes. Given these, management scholars frequently face a stark choice: say something useful to practitioners using narratives in which dramatic effects are often achieved at the expense of academic rigor or maintain the latter by sacrificing practitioner relevance. Recent developments in complexity science offer a new perspective. The article distinguishes between the simplicities achieved by reductionism (equilibrium, law-like equations, linearity, and predictability) and the complexity triggered by initiating "butterfly events"-nonlinearity, scale-free causes, and power laws (PLs). Schema formation and adaptation within Gaussian and PL ontologies are framed in terms of Ashby's law of requisite variety. Variety perceived to be requisite is sensitive to the type of ontological assumptions that are made. PL approaches to management inquiry focusing on rank/frequency distributions, fractal structures, and scale-free dynamics are outlined.

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Boisot, Max; McKelvey, Bill

Connectivity, extremes, and adaptation: A power-law perspective of organizational effectiveness

06/2011
Managers are often required to respond in adaptive ways to the threats and opportunities presented by rare, extreme outcomes. Given these, management scholars frequently face a stark choice: say something useful to practitioners using narratives in which dramatic effects are often achieved at the expense of academic rigor or maintain the latter by sacrificing practitioner relevance. Recent developments in complexity science offer a new perspective. The article distinguishes between the simplicities achieved by reductionism (equilibrium, law-like equations, linearity, and predictability) and the complexity triggered by initiating "butterfly events"-nonlinearity, scale-free causes, and power laws (PLs). Schema formation and adaptation within Gaussian and PL ontologies are framed in terms of Ashby's law of requisite variety. Variety perceived to be requisite is sensitive to the type of ontological assumptions that are made. PL approaches to management inquiry focusing on rank/frequency distributions, fractal structures, and scale-free dynamics are outlined.
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Connectivity, extremes, and adaptation: A power-law perspective of organizational effectiveness
Boisot, Max; McKelvey, Bill
Journal of Management Inquiry
Vol. 20, n 2, 06/2011, p. 119 - 133

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