Characterizing the Next Generation Knowledge Organization

This paper investigates the major characteristics needed by the next generation knowledge organization. The paper then proposes five organizational characteristics that support sustainable competitive advantage within an environment of rapid change, high complexity and large uncertainty. Next, eight major system characteristics are proposed that will allow the organization of the future to survive and compete. These characteristics are emergent phenomena arising out of the structure and relationships of the proposed organization, an example of an Intelligent Complex Adaptive System (ICAS). They are: Organizational Intelligence; Unity and Shared Purpose; Optimum Complexity; Selectivity; Knowledge Centric; Flow; Permeable Boundaries; and MultiDimensionality. After describing these characteristics, the four processes through which the organization transforms its capabilities into actions are addressed. These processes are: Creativity; Problem Solving; Decision-making; and Implementation. A model is proposed that shows the top-level interactions among the characteristics. This paper is intended to be more suggestive than definitive. A number of these areas are uncharted territory with many streams and rivulets that have not been explored. Research is currently underway to further develop each of these characteristics in more detail and to investigate their mutual interactions and support of the major processes. The next step planned is to identify actions, processes and tools for implementation by ICAS agents and subsystem groups. The Future Environment While it is impossible to predict the future, there are major trends driven by fundamental underlying forces that give some confidence in extrapolating into it. For example, while progress in science and technology is not linear, overall advances in science and technology have consistently led to an increase in knowledge, and advances in their application have created the present world economy and standard of living. The technology to access data, information and knowledge is growing rapidly with time and may well overwhelm our limited human ability to find, identify and retrieve data, information, and knowledge objects in time to interpret and apply them to fast changing crises and opportunities. KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 9 Recognizing that a great many factors and forces impact organizations, and accepting that their number will likely increase in the future, we have attempted to identify the drivers that are behind the phenomena of change, complexity and uncertainty that currently cast a shadow over our institutions. Five drivers of the current and future environment are identified that represent fundamental forces that will challenge future organizational survival. They are: connectivity; data, information and knowledge; speed; access and digitization (see Figure One). In addition to impacting how firms must structure themselves and what strategies and form they take on, these drivers will also impact employees, customers, legislative policies and international relationships, all of which carry over to influence every organization’s ability to meet its objectives. Figure One -Characteristics of the ICAS The first major force of the future environment is connectivity: the number and ease of connecting different parts of the world. Technology has provided totally new ways of moving and transferring data, information, and knowledge among individuals, organizations and governments. Anyone in the world can talk at any time to almost anyone else in the world in real-time through the Internet, satellite KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 10 or fiber optic cables. Virtual conferences and video cameras will be commonplace. The result will be much more communication potentially reducing costs and speeding up the flow of ideas, the making of decisions and, hopefully, the sharing of understanding. Collaboration will involve experts from all over the world, brought together rapidly and efficiently to solve problems or brainstorm ideas. The ability to enter into a formal dialogue with strangers will become a factor in success, as the need for synergistic thinking and rapid action becomes a survival competency. The resulting pressures on organizations will mandate their ability to scan, select and quickly respond to the consequences of this environmental network and web of exchanges and actions. As the number of nodes in a network increases, the number of links increases exponentially. As the links and their consequent relationships increase, so does the complexity. The second driver impacting organization is data, information and knowledge. In addition to possible overload from saturation, organizations will have technology and human systems that search and seek the data, information and knowledge needed to meet their objectives. These systems must validate the information, categorize it, identify the context and develop the best interpretation, thereby laying the groundwork for knowledge application. Each of these activities is difficult enough by itself, but when existing in an environment where information is a bombardment, changing quickly, noisy and possibly random, or with little meaning, the organization will be forced to develop new capabilities that can respond to such terrain. Speed is the next force behind the accelerating world: Speed in the movement of goods and services, in the creation of new ideas through virtual collaboration, in the spread of information through increased bandwidth, in smart search engines and learning software and in the sharing and diffusing of knowledge. Speed shortens time and creates a demand for faster decision-making. It also increases uncertainty by limiting the time available to comprehend what is going on. As discussed below, it exacerbates the problems of validation and assurance of information and knowledge. In general, the pace of everything will continue to accelerate-while simultaneously demanding that the human brain keep up. One challenge for the new organization is the resolution of conflict between the limitations of human processing and the increasing speed of change and exponential growth of data, information and knowledge. Access is a recent problem emerging from the confluence of the three previous phenomena. It has several aspects. The first is how to identify the context of the information so that understanding can be extracted and relevant knowledge created by the user. The combination of large amounts of information coming from multiple networks using high-speed transfer systems that need rapid, quality decisions makes this “context” extraction a difficult problem. When one KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 11 considers the global sources of information and the language and cultural differences that come with international participants in communication networks the challenges become staggering. A second element of access is competition. In the organization of the future competitors will have the ability to quickly and reliably find information on each other, thereby improving their own competitive status and driving other competitors to match or exceed their own. The world of competitive intelligence is already turning in this direction for those with the human capital necessary to understand the whats and hows of Internet superiority. In addition, every organization’s customers will have access to more information and their standards and expectations of products and services will be high. A third effect of increasing access to information is the changed perspective and expectations of employees relative to their place of employment. For example, employees with a broader understanding of their world may constantly assess their own situation relative to employment. To respond to such assessments may necessitate a carefully structured approach to management and leadership, one that ensures long-term employment of the best employees. A final impact of increased access to information is the opportunity of the organization to make use of information as a major internal process and competency. Any of the above characteristics of the environment may have one or all of these impacts on the organization. As the amount and availability of data, information and knowledge continues to increase, of necessity so will the complexity of the organization. Connectivity, speed and large amounts of information from everywhere on earth will seed the culture of the future. How the above characteristics can be turned into shared understanding and knowledge application for the good of the organization is unanswered at this time. A vital question is: “Can organizations adapt and learn fast enough to keep up with the environmental changes driven by these forces?” The digital economy, as it is popularly known, describes the overall movement to make maximum use of digital technology to create new products and increase efficiency. The scope of impact is almost unbelievable, ranging from computers to telephones to publishing to banking to education to medicine to cyberspace. Donald Tapscott considers the digital economy’s driver to be an alliance of converging technologies. In his latest book, Blueprint to the Digital Economy, Tapscott [1, P. 1] offers the following forecast: “Clearly the first 40 years of the computing revolution have been a preamble. Much greater changes lie just ahead. The marriage of computers and communication networks is transforming most aspects of business and consumer activities. Organizations face enormous changes, many occurring simultaneously.” KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 12 It seems clear to most students of the economy that the current and future world will be driven by technology as the number of networks and relationships increase and encourage consumers, businesses, the media and government to expand their range of activities and options through collaboration. As nanotechnology, biotechnology, the communications highway and smart machines embed themselves into the world of homo sapiens, their very invisibility will quietly create an entirely different milieu. This new world will be as different and challenging as the shift from horse transportation to space travel. The changes are more than simply increasing speed, complexity and connectivity. The digital world brings its own set of rules, limitations and constraints that demand a reorientation, restructuring and, in many areas, a redesign from the bottom up for those organizations that will lead the economy. This paper offers a glimpse of what those firms in the knowledge industry may look like. Each of the five major environmental forces discussed above influences the other four. For example Connectivity has made data, information and knowledge more widespread and available, while digitization has provided the technology for wide bandwidth connectivity. These five characteristics of the environment represent major drivers that create an overall landscape upon which the organization of the future must live and adapt. This landscape can be described at the highest level by three characteristics that emerge from the interaction of these five forces. They are familiar to all readers as: Change, Complexity and Uncertainty. The major characteristics of the model proposed in this paper arise from the lower level interactions and relationships found within and external to the organization of the future. Because these results are not directly caused by individual actions, the approach to designing, building, and maintaining the organization must be one of a gardener or orchestra conductor who creates and orchestrates an environment within which the right things are encouraged to happen. This sharply contrasts with the classic design approach where determinism and clear lines of control are assumed. One must be careful not to presume that an open structure, or the free will of individuals, will result in the desired organizational performance. As usual, balance -even in the crazy, fast paced and confusing world of the future -will provide the fundamental form and functions needed. Introduction to ICAS: The Intelligent Complex Adaptive System In our research it quickly became clear that neither the classic bureaucratic nor the currently popular flat organization could provide both the unity and selectivity necessary. A different approach to design was needed to create an organizational system that could enter into a symbiotic relationship with its cooperative enterprise, virtual alliances and external environment while KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 13 simultaneously retaining unity of purpose and selectivity of incoming threats and opportunities. Thus the living system metaphor has to be turned into a reality. The organization that will follow the currently anticipated knowledge organization must be a living system composed of other living systems that combine and interact to provide the capabilities of an advanced, intelligent techno-sociological adaptive enterprise. This system is an ICAS. By complex we mean an organization that can take on a very large number of states. A complex system is made of a large number of individual, intelligent agents, each with their own ability to make decisions and strive for certain goals. These agents (workers) have multiple relationships within the system, and externally through its boundaries, and these relationships can become highly complex and dynamic. Groups of these agents may work together to form components of the system, and these components together may form the whole system or organization under consideration. The word adaptive implies that the entire system is capable of studying and analyzing its environment and taking actions that adapt itself to forces in the environment in fulfilling its overall (organization) goals. This paper addresses the distinctive characteristics of the ICAS as differentiated from current world-class organizations. Most world-class organizations are a combination of hierarchical and team-based structures. The differences between these organizations and the ICAS rest in the domain of the eight emergent characteristics to be discussed and other individual and dynamic group characteristics. We therefore ignore the necessary collateral functions and infrastructure that all successful firms possess. Where current world-class organizations use rules and policies to ensure results, our focus is on creating an environment out of which organizational intelligence emerges and leads to desired results. A basic assumption is that nature, with her millions of years of experience through Darwinian evolution, represents a metaphor that offers good guidelines and insights to lead us in the right direction. We believe that some properties of the human mind are transferable to organizations in more than superficial ways. Another assumption is that the key to success in living systems is how they handle information both within their boundaries and in interaction with their environment. So it is with organizations. One of our main resources in this regard is the recent work done by the Nobel Laureate, Gerald Edelman, in his search to understand consciousness through neuro-scientific research. We also make use of Karl Wiig’s work on knowledge management and intelligent behavior. Csikszentmihalyi’s extensive work on flow theory provides insight into the desirable internal movement of relationships and data, information and knowledge. Finally, complexity theory in general, and the theory of complex adaptive systems in particular, provide a framework for understanding how organizations will be able to pull it all together to compete effectively in the future. KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 14 Intelligent complex adaptive systems (ICAS) may be highly unpredictable or superbly self-organized, depending on their precise internal structure and relation to their environment. They will exhibit a unity of purpose and a coherence of action while being highly selective and sensitive to external threats and opportunities. They will be able to bring diverse knowledge located anywhere in the organization (or beyond) to solve problems and take advantage of opportunities. There will be much more emphasis on individual worker competency and freedom in terms of learning, making decisions, and taking actions in given areas of responsibility coupled with multiple and effective networks that provide sources of knowledge, experience and insights from others. These dynamic networks will represent the main infrastructure of the next generation knowledge-based organization. Made available by increased bandwidth and processing power of both silicon and biotechnology, They offer the opportunity for virtual information and knowledge support systems that connect data, information, knowledge and people through virtual communities, knowledge repositories and knowledge portals. The foundation and grounding of these future firms will be strengthened through a common set of strong stable values held by all employees. Such values not only provide guidance that enhances empowerment but also motivate and strengthen the self-confidence of the workforce, thereby magnifying the effectiveness of the self-organized teams within the ICAS. These organizations will possess a number of emergent characteristics that permit them to survive and successfully compete in the future world. Emergent Characteristics of ICAS As organizations change and take on new forms, they often do so through the creation and development of what systems theorists call emergent characteristics. Auyang, [2] in citing Mills suggests three criteria for emergence: “First, an emergent character of a whole is not the sum of the characters of its parts; second, an emergent character is of a type totally different from the character types of the constituents; third, emergent characters are not deducible or predictable from the behaviors of the constituents investigated separately”. [P. 174] The sources of emergent properties include both structural and relational. Auyang [2, P. 176] notes that “Emergent characters mostly belong to the structural aspect of systems and stem mainly from the organization of their constituents.” Whereas Holland [3] writes that “Emergence is above all a product of coupled, context-dependent interaction. Technically these interactions, and the resulting system, are KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 15 nonlinear: The behavior of the overall system cannot be obtained by summing the behaviors of its constituent parts. ... However, we can reduce the behavior of the whole to the lawful behavior of its parts, if we take the nonlinear interactions into account.” [Pp. 121-2] Ingber [4], in investigating biological design principles that guide self-organization and emergence, extends the normal complexity-based approaches that focus on nodes, connections, and resultant pattern formation to include the importance of architecture, mechanics and structure in the evolution of biological forms. [4, Pp. 269-280] Some examples of emergent properties from Coveney and Highfield [5] are: life is an emergent property arising from physicochemical systems organizing and interacting in certain ways; a human being is an emergent property of huge numbers of cells; a city is an emergent property of thousands or millions of humans; and a company is more than the sum of its technology, real estate and people [5, P. 330]. The connection between processes and relationships within the organization and its emergent properties is complex and difficult, if not impossible, to follow via cause and effect chains. It is also difficult to predict the precise nature of emergent characteristics. This is one reason why planned change is so difficult and the change process so hard to control. For instance, it is easy to create a vision of a team-based organization with high employee empowerment. But, the exact details of the best team structure or the specific way that employees should be empowered are very hard to predetermine. People are not machines and their variability and self-determination are essential for their efficacy. Thus, while a desirable emergent characteristic can be nurtured, it cannot be decreed. Every one of the eight characteristics of what we call ICAS must emerge from the nature of the organization, and cannot be pre-designed and implemented by managerial fiat. These top-level properties best describe the necessary conditions for the optimum operation of four major processes to deal effectively with the external environment and with competitors. These processes represent the primary ways that organizations internally prepare themselves to take actions that affect their environment and thereby ensure survival. The processes are: Creativity, Problem Solving, Decision Making and Implementation. The eight emergent characteristics are shown in Figure One to highlight their relationships. The ICAS is in many ways a living system, as it must be to survive in a rapidly changing, nonlinear, complex, dynamic and uncertain world. These characteristics provide the internal capability to deal with the future environment. We will briefly address each of them in turn: Organizational Intelligence, Shared Purpose, Selectivity, Optimum Complexity, Permeable Boundaries, Knowledge Centric, Flow and Multi-Dimensionality. (See Figure Two.) These brief discussions do not describe those lower-level elements whose interaction produces these emergent characteristics. KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 16 Organizational Intelligence Intelligence, according to Webster [6, P. 739], is the capacity for reasoning and understanding or an aptitude for grasping truths. When applied to organizations, Wiig [7, P. 84] broadens this view of intelligence and considers is as the ability of a person to think, reason, understand and act. He further considers intelligence as applying to organizations and includes the capabilities to innovate and acquire knowledge and apply it to relevant situations. From an organizational viewpoint, both employees and their organization can exhibit intelligent behavior. Pinchot and Pinchot [8, Pp. 19-20] describe the intelligent organization as one which can face many competitors simultaneously and deal effectively with all of them and attend to all the details and supporting competencies that add up to cost-effective, superior performance. They further note that “the quality of relationships between members of the organization is a strategic issue that determines the very fabric of the organization.” [P. 70] Figure Two -Levels of Organizational Emergence KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 17 McMaster [9, P. 3] refers to organizational intelligence as “the capacity of a corporation as a whole to gather information, to innovate, to generate knowledge, and to act effectively based on the knowledge it has generated. This capacity is the basis of success in a rapidly changing or highly competitive environment. ... Organizational intelligence refers to a capacity which is inherent in a system of organization. It is greater than the sum of the intelligence, information, and knowledge of each individual in that organization.” We agree with the above authors. As a working concept, we take organizational intelligence to be the ability of an organization to perceive, interpret and respond to its environment in a manner that simultaneously meets its organizational goals while satisfying its stakeholders, that is, its employees, customers, investors, community and environment. Organizational intelligence is a descriptive term that indicates the measure of the organization’s (and its workforce’s) capability to exhibit intelligent behavior. Intelligent behavior of individuals, groups and organizations [7, P. 38] can be understood in terms of (1) demonstrating behavior traits that are effective and acceptable; (2) being well prepared; (3) choosing the right posture in each situation; (4) being able to solve problems well; and (5) being able to make high quality decisions and take effective actions for their implementation. Each of these can be studied to find the specific competencies needed for success in each area. For example, intelligent behavior traits range from listening to others, remaining objective and flexible to learning, and thinking before acting. Independent thought, the ability to collaborate well in pressure situations, and having strong principles all help create credibility and trust, and support good long-term relationships. Such relationships greatly enhance the speed and quality of decision-making and situational assessment. Intelligent behavior from an organizational perspective means that external firms, customers and partners will look with favor on the idea of interacting with the organization. Intelligent behavior leads to good working relationships at every level. According to McMaster [9, P. 166], relationships are the foundation of human intelligence. While good relationships have always been important, in the future they will be critical due to the advance of technology and the increasing role of knowledge in handling time compression and complexity. Being well prepared means maintaining continuous context knowledge of surroundings, thinking ahead (anticipating possible events and evaluating worstcase scenarios), and rapidly developing opportunities that will be advantageous at all levels of the organization. Tomorrow’s world will require a good knowledge of systems thinking and the ability to integrate large numbers of divergent data and information into a cohesive unity of understanding. We discuss this challenge in the section on Unity and Shared Purpose. KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 18 For an organization to behave intelligently as a complex adaptive system, it must achieve continuous, interdependent collaboration and interplay among all levels of its system. This means balancing the knowledge and actions of its agents to achieve both the lowest-level tasks and highest-level vision of the organization, creating a distributed intelligence throughout the organization. This can be done by using teams and communities to amplify local intelligence levels, accelerate quality decision-making, and foster innovation and creativity. Being well prepared enables the firm to choose the right tactics. This is not easy in a world supersaturated with information, access problems and complex nonlinear changes and threats impacting the organization. Quick reaction capabilities must be assembled using the knowledge and expertise needed to act effectively. Locating the right knowledge, experience and tools to effect right action and tactics is a major strength of an ICAS. While problem solving and decision-making are well known competencies, their implementation is made more difficult in the future world of change, complexity and uncertainty. To perform these processes will require more data, information and knowledge than any single person, and perhaps any one group, can possess. Just as no one part of the brain is responsible for a given thought or process [10, Pp. 31-2], no one part of ICAS will necessarily be sufficient to develop tactics, solve problems or make decisions. Undoubtedly, this approach will be widely resisted by many managers and leaders. It has disturbing consequences for the historical balance among authority, responsibility and accountability. These problems are already being faced with the extended use of teams (See Bennet, [11]). In discussing intelligent behavior Wiig [7, P. 39] notes that knowledge plays a central role and suggests the following six knowledge areas that need to be developed: § Knowledge of knowledge § Thinking about thinking § “World knowledge” of society, sciences, people, etc. § Knowledge of primary work-related domains § Knowledge of private life, hobbies, etc. § Basic knowledge of “walking,” “talking,” 3 Rs, social skills, etc. A study of knowledge workers in Bell Labs by Kelly and Caplan [12, Pp. 128-39] identified nine capabilities that lead to high performance . Their capabilities are laid out in some detail and, in general, agree with Wiig’s [7, Pp. 50-51] description. What has not been done to our knowledge is an investigation of each capability to see how it can be expanded to teams and larger components of an organization to create the desired level of organizational intelligence. KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 19 Although data and information are necessary for acting intelligently, it is the knowledge that is created and acted upon that is the critical factor for the ICAS. There is currently much discussion and many interpretations of the terms data, information and knowledge. Since we are concerned with making organizations work better, we will take a somewhat pragmatic stance. We take these terms to have the following meaning. Data are facts, numbers or individual entities without context or purpose. Information is data that has relevance and may have some context and meaning associated with it. Knowledge, while made up of data and information, can be thought of as much greater understanding of a situation, relationships, causal phenomena, and the theories and rules (both explicit and implicit) that underlie a given domain or problem. According to Wiig [7, P. 82], P. “Knowledge can be thought of as the body of understandings, generalizations, and abstractions that we carry with us on a permanent or semi-permanent basis and apply to interpret and manage the world around us. ... we will consider knowledge to be the collection of mental units of all kinds that provides us with understanding and insights.” Thus knowledge is what each of us uses to determine what something means. In addition, it should not to be separated from action or from pragmatic concerns. McMaster [9, P. 83] says “Knowledge is information that is integrated with the entire system in such a way that it is available for action at potentially appropriate times.” Data, information and knowledge support organizational intelligence through the competency and demonstrated actions of both individuals and groups within the organization. In summary, an organization needs to exhibit intelligent behavior to provide the best response to its environment and to influence that environment in an effective way. Such intelligence must be coordinated throughout the organization at every level so there is a unity of purpose and a consistency of history as the firm evolves and grows within its outside surroundings. At the ICAS level, the characteristic of intelligence must emerge from a large number of individual agents and their relationships, supported by technology and other artifacts. Since intelligence is not a specific location within the ICAS organization, it must come from lower level actions, processes and characteristics. That is, intelligence is an emergent property of ICAS. We now turn to the other characteristics that, taken together, support intelligent behavior. Unity and Shared Purpose Unity and shared purpose represents the ability of the ICAS organization to integrate and mobilize its resources to (1) provide a continuous line of focus and attention and (2) pull together the relevant parts of the organizations when and where they are needed. Senge [13, P. 9] addresses a partial solution to this problem in his management book, The Fifth Discipline. He emphasizes the importance of a shared vision where employees participate in the development of a corporate vision, and can then make decisions and take actions consistent with KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 20 the directions set by senior leadership . One can hardly disagree with this so long as the environment is reasonably stable and the vision does not change frequently. In the future world however, one can expect more changes within every organization that operates close to the field where knowledge and information are the prime movers as Senge envisions. Under such conditions, structures and relationships must be established that support and ensure continuous, rapid two-way feedback between key components throughout the organization and the central nexus where top-level decisions are made or orchestrated. In the fifth of a series of books describing his research on consciousness, Edelman and his co-author, Tononi [14, P. 36], identify the mechanism that provides unity to consciousness, thereby creating a continuous history of thought and a consistency of identity and action. “Our analysis leads to several conclusions. First, conscious experience appears to be associated with neural activity that is distributed simultaneously across neuronal groups in many different regions of the brain. Consciousness is therefore not the prerogative of any one brain area; instead, its neural substrates are widely dispersed throughout the so-called thalamocortical system and associated regions. Second, to support conscious experience, a large number of groups of neurons must interact rapidly and reciprocally through the process called reentry. If these reentrant interactions are blocked, entire sectors of consciousness disappear, and consciousness itself may shrink or split. Finally, we show that the activity patterns of the groups of neurons that support conscious experience must be constantly changing and sufficiently differentiated from one other. If a large number of neurons in the brain start firing in the same way, reducing the diversity of the brain’s neuronal repertoires, as is the case in deep sleep and epilepsy, consciousness disappears.” Recognize that the brain has roughly 100 billion neurons, each with an average of 1000 connections to other neurons. Information is stored in the connections between neurons and in patterns of connecting neurons, which change continuously, dependent on external sensory inputs and other internal pattern inputs. It is also known that different regions of the brain process different parts of a visual image, for example, and that all of the outputs of these processes are combined to make the image a unitary whole so that the perceiver “sees” a self consistent, integrated picture [14, Pp. 113-24]. This ability to maintain different parts of the brain in harmony and to pull them together is exactly the challenge of the future organization, where the external environmental complexity continually impinges on many parts of the firm and may not in itself have any coherence or consistency. Evolution’s solution to the brain’s so called ”binding problem” [14, KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 21 Pp. 114-15] is to create certain neuron paths that provide continuous two-way communication between key operating networks. “Finally, if we consider neural dynamics (the way patterns of activity in the brain change with time), the most striking special feature of the brains of higher vertebrates is the occurrence of a process we have called reentry. Reentry. . . depends on the possibility of cycles of signaling in the thalamocortical meshwork and other networks mentioned earlier. It is the ongoing, recursive interchange of parallel signals between reciprocally connected areas of the brain, an interchange that continually coordinates the activities of these areas’ maps to each other in space and time. This interchange, unlike feedback, involves many parallel paths and has no specific instructive error function associated with it. Instead, it alters selective events and correlations of signals among areas and is essential for the synchronization and coordination of the areas’ mutual functions.” [14, P. 48] What are we to make of these findings? Clearly an individual is not a neuron and consciousness is not a good description of our future organization. But, if we think about the patterns of interaction and the way that information is shared and unified there are some telling lessons here. For our new organization to work intelligently, it must be able to simultaneously unify its relevant parts to gain maximum situational understanding, knowledge and concentration of its power to act and to react. Because of the large number of threats and opportunities and the urgent need for fast response, the ICAS will put in place systems to reach into, and maintain, continuous two-way communication with a large number of relatively independent subsystems. According to complexity research [15, Pp. 72-106], these subsystems of agents should be self-organizing to maximize their learning and innovation. In addition, self-organizing groups are capable of creating emergent properties and are better at dealing with surprises and unknowable futures than the normal organizational structure. Stacy addresses this topic head on when he says [15, Pp. 268-9]: “...The immediate conclusion drawn is that ignorance can be overcome by greater investment in gathering information, funneling it to some central point where it can be analyzed, and then feeding it back to the actors. The dominant schema therefore leads people to believe that ignorance can be overcome by research into organizational excellence, incompetence can be overcome by training and developing managers, and systems can be used to prevent bad behavior ... From the complexity perspective, however, we reach the opposite conclusion, namely, that the future is truly KNOWLEDGE AND INNOVATION: JOURNAL OF THE KMCI VOLUME ONE, NO. ONE, OCTOBER 15, 2000 © 2000 KNOWLEDGE MANAGEMENT CONSORTIUM INTERNATIONAL, INC. 22 unknowable. Creative futures emerge unpredictably from selforganizing interactions between members; therefore, they clearly cannot use some forecast of long-term outcomes to decide between one action and another.” The need for unity and shared purpose and also for local freedom, empowerment and self-organization presents an apparent paradox. The solution lies in accepting both as necessary for intelligent behavior and in structuring relations among subsystems and organizational levels such that there is enough flexibility and two-way communication for both to coexist, each rising to meet local and organizational needs as appropriate. Note that self-organization need not imply the lack of rules. A shared vision, common values and widespread communication of context information all support empowerment and self-organization. In any case, both rules and the freedom to self-organize are needed. The specific balance between rules for alignment and coherence of operations and empowerment for local work flow optimization and innovation is both situationally dependent and dynamic. There is no pat formula for a desired balance. When achieved, unity and shared purpose create an integration of internal activities that make the whole organization greater than the sum of its parts. The synergy, differentiation, and variety of its subsystems provide the internal complexity needed to deal with the complexity of the outside world. To be effective, this complexity must be able to provide not only a large variety of responses but any particular response must be coherent with the rest of the ICAS organization. The unity of the organization’s experiences is closely associated with its perception of external events. This is where the flow of information, knowledge and optimal experience (feelings) becomes so important. Although an organization can be aware of several mutually incoherent events at the same time, if these are not integrated at some level, the responses may be inconsistent and deleterious. This emphasizes the need for continuous and widespread common context sharing throughout the organization. A final word of caution, too strong a unity and shared purpose can become stifling if it prohibits divergent thinking or remains focused on one strategy for too long. The unity needed is the momentary unity of coherent action and its context knowledge. Specific directions and tactics will change frequently due to the nonlinearity and dynamics of the external world.