Friday, February 1, 2013

Design for the 21st Century Management & Education Institution

Back in 1989, "The Wall" had not yet come down yet, and first tectonic shifts of the social fabric in Europe were already under way, Jay W. Forrester gave a Banquet Talk at the international meeting of the System Dynamics Society. It was July 13, 1989, in Stuttgart.

http://sloanreview.mit.edu/feature/jay-forrester-shock-to-the-system/
As Jay W. Forrester pointed out on how he had become to create the field of system dynamics over the course of his life, on how he and his team managed the development of the first automate air-defense system, and how his work on Urban Dynamics led to the contact with Aurelio Peccei, founder of the Club of Rome  from which Limits to Growth later came up.

At the end of his talk he points out "A rather small number of relatively simple structures will be found repeatedly in different businesses, professions, and real-life settings. One of Draper's junior high school students, working with bacteria in a culture and in computer simulation, looked up and observed, "This is the world population problem, isn't it?" Such transfer of insights from one setting to another will help to break down the barriers between disciplines. It means that learning in one field becomes applicable to to other fields. There is now a promise of reversing the trend of the last century that has been moving away from the "Renaissance man" toward fragmented specialization. We can now work toward an integrated, systemic, educational process that is more efficient, more appropriate to a world increasing complexity, and more compatible with a unity in life."

Almost 24 years later, what is the evidence that this is true? Personally I very well remember a job interview in Stuttgart for a position as a lean consultant (which when filled out properly goes very much in tune with the words above) back in early 2008. I still recall the drop of my heart beat when the CEO of the company told me, "You are the right person we are looking for at the moment. Your knowledge and expertise in the field is exactly what we need. - Yet, we can't hire you: you would be the first non-engineer (note: economist) in the team of 14!"

If such behavior of business leader is still the prevalent mode of action, where shall we establish the spaces, and institutions that build on Jay W. Forrester's vision of 1989?

3 comments:

Ralf Lippold said...

2003 Jay Forrester wrote an article about a new era of economic theory, as many of the old theories tend not to fully explain the deep recessions/depressions of the past, including the 2008/2009 financial crisis.

http://onlinelibrary.wiley.com/store/10.1002/sdr.1490/asset/sdr1490.pdf?v=1&t=ht4edjvv&s=48a78813060232bbd95a64be452b4d8ffb3a7f86

His observation is as follows (quote):

"Observation
Great opportunities lie ahead in establishing a new kind of systems economics and a very different kind of economics education. However, we must be aware that such a change is a major paradigm shift from that of the current economics profession. Paradigm shifts come very slowly. Holders of the existing theories and methods will probably not be converted. The future path must be through building up an alternative and more effective approach. Among present economists are many who are disappointed in the ineffectiveness of the field but only the most daring will be willing to break with their past and attempt to learn system dynamics modeling. The strategy must to be to persist, even over several decades, in surrounding and replacing the existing mainstream economic paradigm."

... more than 10 years later this still holds to be true. Perhaps we should just start to bring economic thinking into our kindergarden and schools (including university paths) as a more general field for everyone.

Where everyone can read, the printed book really makes sense.

Ralf Lippold said...

These two gems of system dynamics haven't lost any actuality these days:

https://www.youtube.com/watch?v=rFyXrFKt5Gw - "The Business Cycle" by PBS Newshour

http://dspace.mit.edu/bitstream/handle/1721.1/46906/businesscycleslo00ster.pdf?sequence=1 Business Cycles and Long Waves: A Behavioral Disequilibrium Perspective, D-4308

Ralf Lippold said...

The correct and publicly available link to Jay W. Forrester's 2003 talk can be found on the System Dynamics Society website

http://www.systemdynamics.org/conferences/2003/proceed/PAPERS/S02.pdf

In today's world even more so relevant, despite the age of 13 years!