For systems innovators, it is important to note that all human systems are artificial. By “artificial,” we mean that human systems would not exist naturally in the world without humans. No natural rules govern the systems humans create – whether the systems are governments, businesses, educational institutions, or information systems. This is not to say that the systems humans create do not have rules; rather, they often do! For systems innovators, you can influence and change the rules. Part of innovating is identifying when the rules of a system, be it an organization or information system, could be modified to provide a better benefit.
So what are rules? Rules are defined ways of interacting with elements in a system, often proscribing an action. One rule might be “do not steal.” This rule means that individuals should not take an element that does not belong to them. Another rule might be “if an electronic message is received from Company ABC, route it to our Accounts Payable.” With rules, it is important to note that they link elements with actions. Rules can form the policy of a system. By system policy, we mean rules that link actions to elements in a system.
Information systems include data and processes. Data can be logical values (true vs. false), numbers, words, or strung-together sentences. Actions, known as processes, are required to actively exchange, transform, and move data. For a computer to “compute,” processes actively manipulate data. Components of an information system detail the rules for what processes can do to data, under what circumstances. A systems innovator seeking to improve an information system might look to modify the data an information system contain or collect. Equally, a systems innovator might improve an information system by modifying what processes manipulate data – or an innovator might modify the policies of a system to reuse existing processes in new ways on data.
Recognizing that all human systems are artificial leads to another equally important perspective for our modern age: organizations are becoming like markets. By markets, we mean places where no one person is commanding everyone else. With marketplaces, you are free to wander to different vendors, try their wares, and are under no obligation to purchase their goods or services. No one is commanding you to buy from Company ABC vs. XYZ – you get to decide.
For organizations, this means that traditional “management” of individuals by command and control is increasingly becoming difficult in our complex, global world. Reasons for this reduced ability to command are partially dependent on globalization. Businesses may be partnered with other businesses where they do not have the ability to directly tell these other companies what to do. The same may be true for world governments. There also may be instances where organizations are competing with one another, perhaps to sell similar goods or services to you as a consumer – or perhaps to discover a new idea or innovation.
Cumulatively, these factors mean that organizations will be less able to command individuals or other organizations what they would like them to do, and instead have to rely on other mechanisms. These other mechanisms include using diplomacy to influence individuals or organizations, being smarter or stronger than other competing organizations, or giving rewards to elicit desired behaviors from individuals.
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