Chaos Management and the Dynamics of Information

A New Way to Manage People in Action

(especially during paradigm shifts)

A Management System by Dr. David E. Wojick, PE, based on a formal model of the general dynamics of information. This model was originally developed at the Naval Research Laboratory, Washington DC.


Introduction: Meet the Issue Storm and the Cognitive Enterprise

Chaos management is about "issue storms"....swirling, turbulent flows of information that blow up when people try to deal with complex issues. Our world is increasingly dominated by issue storms. Our lives are issue driven and chaotic. Our interaction with others is complex and unpredictable.

Here's why. It's the downside of information technology. Because of today's powerful technology, issues tend to mushroom out of control. They spread rapidly, consuming precious cognitive resources in an uncoordinated, confused way. When this happens management quickly loses its ability to manage. When ten or twenty issue storms are raging out of control in an organization the result is chaos. Slowly but surely the copier, the fax, and of course the computer, have made the pace of information transfer over 10,000 times faster than it was just a few decades ago. No wonder things get out of control so easily. The power if this technology is the source of the problem, bringing with it the issue storm and the need for new methods of management.

The basic, traditional concepts of management are still valid....planning, budgeting, scheduling, reporting and control. But how we implement these concepts needs to be changed to deal with issue storms and chaos. The traditional ways were developed to manage physical activities like manufacturing and construction. But cognitive activities are very different, that is why the traditional methods have broken down.

The popular management theorist Meg Wheatley is correct to say that we have to rethink fundamental management concepts like control and autonomy. This is because they presently embody too much of the management science of physical production systems. Concepts are theories. As such they embody many unstated assumptions about the world, assumptions that may have been true when the concepts were first formulated, but which may subsequently become false. Such is the case with many of our most basic management concepts, because of the rise of something I call the "cognitive enterprise".

Modern management science began early in the 20th century with people like Ford, Taylor and Gantt, and the rise of the assembly line. The science in question was the science of manual labor. The goal was to control human action as precisely as possible, so as to maximize its productivity. The epitome of this science was time and motion studies.

But as the century has progressed there has been a fundamental shift in the nature of work itself, a shift from manual labor to the cognitive processing of information. Today most people think for a living. Even in manufacturing the rise of computer controlled machinery has opened the door to ongoing creative thinking throughout the work force. Thought, however, cannot be measured, planned or controlled like manual labor. Thus the fundamental assumption of complete controllability, that underlies all of traditional management thinking, is simply false.

How then do we manage the cognitive enterprise? First of all we must make a fundamental distinction between attention and thought. Attention, or what people think about, can be managed. Thought, the mysterious and creative product of that attention, cannot be managed. So attention is the most precious manageable resource the cognitive enterprise has. The challenge to management is to make the best possible use of this scarce cognitive resource. We already try to do this, of course. Directing someone to explore an issue, or even simply to answer a question, is managing their attention. The question is to what degree can we do this `scientifically'. That is, to what degree can we apply the traditional tools of data collection and analysis, planning, scheduling, budgeting, etc., to the attention resource?

We can do a great deal, but the form these tools will take is very new and very different from the traditional approaches. This in itself will be a major paradigm shift, but it is not the one alluded to in the title. The latter has to do with the chaos that is increasingly prevalent in our global marketplace, as explained in the next section.

Chaos in the Global Marketplace

An increasing number of global markets are presently undergoing major paradigm shifts. That is, whole new ways of thinking are rapidly evolving. The electric power industry is a good example, where a massive wave of privatization and deregulation is sweeping the world. Whole new commercial forms and practices are being articulated, many as yet poorly defined. Undoubtedly some have yet even to be thought of.

A paradigm shift is a special kind of chaotic transient, because it involves the reformulation of fundamental concepts. All information based chaotic transients involve information demand and confusion due to information delay. A natural disaster is a good example. But a paradigm shift by its nature entails conceptual confusion, which is far deeper.

What commercial opportunities do these paradigm shifts present? How does one manage a cognitive enterprise so as to best seize these opportunities? Good questions these, but first we must finish our history lesson.

The Second Wave of Scientific Management

Around midcentury scientific management moved from the factory floor into the boardroom. Data collection and mathematical analysis became the basis for strategic planning and decision making. The mainframe computer was the driver, supporting exciting new techniques like linear programming and statistical analysis. Back in the factory this same revolution led to the rise of modeling techniques like operations research and critical path scheduling.

As the century progressed the computers, and the models, got bigger. Massive data collection systems evolved. New analytical techniques emerged, that were unthinkable without the computer. However, while complex, these techniques were still mostly linear in nature.

All along a fundamental assumption was made that is becoming increasingly invalid. This is the assumption of predictability, especially predictability based on linearity. Predictability is the external counterpart to internal control. But with the rise of the cognitive enterprise, and driven by new information technologies, has come chaos. The future is often unpredictable, driven by powerful nonlinear forces. Detailed planning or modeling is useful, but only the starting point. Ongoing monitoring and management of information transactions is required. Unlike a manufacturing facility, there is no business as usual in an issue driven environment. Every day is different.

Chaos Management

The growing challenge is to manage the cognitive enterprise in the face of intrinsic unpredictability. This challenge is especially acute in the context of a paradigm shift in the marketplace. Here the very concept of how one will do business is unpredictable because it is evolving rapidly.

A whole new body of techniques is arising to help meet this challenge. Techniques that will fundamentally change the way that firms operate. These techniques stress early identification of issue storms, rapid response with an evolving mix of strategies, and a realistic appreciation for uncertainty. They also stress forecasting in lieu of prediction, and individual autonomy.

Issue Storm Patterns

Regarding issue storms, it is time to talk about patterns and meta-level thinking. The latter means thinking about what you are doing, and what others are doing, as opposed to doing it. You do this by asking questions like "what business am I in?" and "what is going on here?".

Every issue storm has a unique pattern, which may change over time, or die out. Understanding the underlying pattern is important for several reasons. It helps you see why things are happening as they are, what is likely to happen next, and it helps avoid blaming others for the situation. The point is that whoever takes the time to understand confusion will find the heart of the battle, and might just win.

Issue Storm Dynamics

Given the pattern, you then ask what are the dynamics? Here the key concept is delay of information due to processing time, transaction time, allocation of attention, etc. For example, you have said things that have caused others in the system to think and say things, which in turn causes others to say things, and so on. Things you said some time ago may only now be affecting distant parts of the system. Likewise, things that happened in distant parts some time ago may only now be coming to you. This is why issue storms have a life of their own. Like the internet, no one is in charge.

Patterns again

I know the above sounds vague, but in a specific case it can be very precise. For example, patterns can exhibit all the common topological forms....lines, trees, networks and loops, in great combination. Which of these forms occurs where profoundly affects the dynamics of the system. You tell your secretary when we can meet and she tells me; that's a line. You tell her to set up a meeting and she tells lots of people, that's a tree. Trees allow for divergence and convergence of information, lines don't. Your relation to the board of directors probably is a tree, but their relation to each other is likely to be a network. And so on.

This difference matters. In networks information can get from place to place via different paths, not so in trees. For example, in most organizations the chain of command is a tree, but in the Navy it is a network. One person can have two different bosses (they call it being double hatted....probably has something to do with running a ship), so it is easy to receive contradictory orders. In loops paths may be endless. Bureaucracies have a way of creating looping situations, either to avoid making tough decisions or because of vagueness in their rules. Is there a lot of looping in your world?

Dynamics again

When you look at an issue storm ask where is this issue going? Not going conceptually, but physically. Who's thinking about it now, who will think about it next, and so on. Of course if it is chaotic this gets unpredictable pretty soon, but the drill is still useful. This is not classic workflow analysis. It is forecasting, with all that concept entails. And in many cases it is not that unpredictable in the short run. Once you get clear about the dynamics of an issue storm you can start thinking about the actions and consequences that flow from that dynamics. The mistake is to try to guess the actions, without understanding the dynamics, a mistake classical economics makes with its assumption of equilibrium based on perfect knowledge among the players.

Now to make it really complicated, keep in mind that the dynamics of an issue storm are driven by the articulation of the information structures that underlie the issue. This is not a hairy as it sounds, or not always. For example, if a general question arises consider who is going to work out the details, and when? This is especially important in places where what is going on fundamentally is the articulation of a new paradigm. Remember too that the demand on attention increases exponentially with level of detail. Or conversely, that given a constant supply of attention, the level of detail that can be fleshed out is highly constrained.

If all of the above seems pretty demanding, it can be but doesn't have to be. Scaling applies, so you can do a little or a lot. Like in chemical engineering where you can start with a simple mass balance for a process, or go all the way to detailed piping and instrumentation drawings. One of the most simple chaos management systems is a list of the ten biggest issue storms you are involved in. But patterns are very useful, so I recommend that you at least have them for these ten. At the other extreme you would have fairly detailed patterns, plus the key information structures that drive the dynamics, especially the issue trees. Then too you need ways to collect meta-level data about what is going on.

But above all the secret is to be aware of your place in a never ending swirl of issues and information. Our lives have indeed become chaotic.

Dr. David E. Wojick, PE


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