Management
&
Entrepreneurial
Cybernetics
By Alex Stuart , Ronny Bull,
Chaitanya Pinnamaneni
In order of presentation
What is Management
Cybernetics?
 Stafford
Beer described Cybernetics as
“the science of effective organization”
 Tony Gill suggests that Management
Cybernetics implies both effective
organization and steersmanhip
 This in turn implies that Management
Cybernetics is the cybernetics of control
and organization
Wikipedia’s definition
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Management cybernetics involves the study of what things do and
how they interact with one another, not just what they are.
It is a field of knowledge which can help us to gain further
knowledge in situations where we cannot obtain any concrete
knowledge
It helps us achieve the right approach to complexity
It is the realization of one’s own responsibility, with which one can
make others aware of their own responsibilities
It is an approach that does not completely eradicate complexity,
but shows the ways in which it can be best handled
It provides the chance to maintain long-term acceptance
It is an approach that everyone understands when they apply it to
their own situation
It is an approach that everyone has already practiced, whether
they realize it or not
The Father of Management
Cybernetics
 In
1959, Stafford Beer published
Cybernetics and management
which introduced this field of
study
 Management Cybernetics
relies on the Viable System
Model which he created in the
1960’s
Management Cybernetics
 Ashby
in Introduction to Cybernetics
remarks that cybernetics should exhibit
parallels between society, the brain, and
the machine
 Beer focused on this idea and attracted
the attention of managers and
management scientists
 Beer attempted to replicate what he
observed in nature
Management Cybernetics
 Beer
also incorporated ideas from
Forrester’s systems dynamics, especially
the concept of dynamical feedback
loops
 The Viable System model relies heavily on
this and is able to describe entire systems
 The Viable System model also relies on
Ashby’s Law of Requisite Variety
First and Second Order
Cybernetics
Ashby’s Law of Requisite
Variety
 Only
variety absorbs variety
 Three properties: Complexity,
Variety, Adaptation
 Goal: management of
complexity
Black Box
 One
or more inputs and one or more
outputs
 Gill explains “Process managers set
performance targets, monitor the output
against these targets and take corrective
action (feedback) to alter the inputs so
the output better meet the set
requirements”
Black Box
Disturbances
Inputs
Process
Managers
Black Box
Corrective
Action
Performance
Targets
Outputs
Performance
Monitoring
Beer explains Feedback
Ouroboros
 Greek
symbol that
represented
feedback
 Defined as
“Returning
information to the
origin to correct a
system’s behavior”
Reductionism
 Wikipedia
defines
Reductionism as “an
approach to understanding
the nature of complex
things by reducing them to
the interactions of their
parts, or to simpler or more
fundamental things”
 Examples: Physics,
Chemistry, and Biology
Descartes’ Duck
Organizational Chart
Orders
Boss
Obedience
Peons
Peons
Peons
Organizational Chart
 Organization
is based upon a hierarchical
design where the man with the money is
the man on top
 Authoritarian design
 Horizontal communication is difficult
 Orders travel vertically downwards and
obedience travels upwards
 Blame is easily placed, and employees
are only familiar with their local work area
Traditional Business
Organization Method
 Decide
objective
 Make plan
 Organize
 Execute
 Supervise
Viable Systems Model
Viable Systems Model
Viable Systems Model
Viable Systems Model
Based on observations of nature
 Identity
 Planning
 Management
 Audit
 Coordination
 Operation
Complexity
Viable Systems Model
Viable Systems Model
 Recursive
by nature
 e.g. human body, cells->tissues->organs
etc.
 Management is separate from operations
due to the difference between
processing energy & materials and
information
 Information is the key to having control
and thus the key to management
Advantages over the
Organizational Chart
 All
communication lines are accessible
 Maximum desirable autonomy of the
operations
 Standardized model – everyone knows
their part
 Holistic and systematic approach
 Works for any type of organization
including government and businesses
Examples of Viable Systems
The U.S. Government
 The
government
exhibits many traits of
Management
Cybernetics
 The government was
originally modeled from
the bottom up; ‘for the
people by the people’
The State
Politics
Economics
Law
Traffic Light Example
Climate example
US government
References
 Stafford
Beers’ Lectures Presented by
Javier Livas at
http://wn.com/Stafford_Beer
 Management Cybernetics by Tony Gill
http://www.phrontis.com/syncho/MC1.pd
f
 http://www.worldlingo.com/ma/enwiki/e
n/Management_cybernetics
References
 http://en.wikipedia.org/wiki/Managemen
t_cybernetics
 http://en.wikipedia.org/wiki/Reductionism
 CSC 551 Lecture Notes – Prof. Sengupta
 http://www.pollsb.com/photos/60/27842beating_dead_horse_what.jpg