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APPENDIX

IMPLICATIONS OF COMPLEXITY THEORY FOR ORGANISATIONS AND CHANGE

In the latter half of the nineties Ralph Stacey established at the University of Hertfordshire, the Centre for Complexity Management out of which have come a number of books exploring the implications of complexity for organisational change.

Stacey argues that  organisations are inherently ‘adaptive and non-linear’ but  they tend to be run as if they were ‘linear’  and predictable - this he calls the ‘legitimate’ system which ‘consists of links that are either (1) formally and intentionally established by the most powerful members of an organisation or (2) established by well understood, implicit principles that are widely accepted by members of the organisation - that is a shared culture or accepted ideology’ (Stacey 1996 :24)

But, as anyone who has ever worked in an organisation knows, these conditions are not always satisfied;  surprises occur out of what Stacey describes as ‘idiosyncratic behaviour of  the agents’ which, potentially, ‘would endanger the predictability that the legitimate system exists to occur’. Stacey gives the name of ‘shadow’ system to those links in an organisation which are

‘spontaneously  and informally established by individual agents among themselves during the course of interacting in the legitimate system. The result  is another network,  a kind of shadow of the legitimate  system consisting of informal social and political links, in which agents develop their own rules for interacting with each other in the course of their interaction’ (Stacey 1996 :26)

I  have developed a model (  Critten  2006) which  seeks to reflect  how the ‘shadow’ side of organisations can impact on the ‘legitimate’ side through the intersection of two dimensions:

Top-Down (Directions cascading down   v     Bottom-up (Views from all staff

from senior management)  influencing policy)

Outside –In (Influences from market      v     Inside-Out (Capacity of an

and  environment external to  organisation to ‘create’

organisation)   and enact its own

  environment

The intersection of these dimensions creates four quadrants each reflecting very different dynamics. as described on  the next page

STRATEGIC  This is defined by ‘Top-Down’ and ‘Outside-In’ dynamics. This is how business is usually perceived and embraces the kind of disciplines offered at most Business Schools – Marketing, Performance Management etc. Within Stacey’s definition of ‘Legitimate’ this falls wholly within a legitimate domain ‘formally and intentionally established by the most powerful members of an organisation ‘

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