Organisations, Innovation and Complexity: New Perspectives on the Knowledge Economy

University of Manchester
9-10th September 2004

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Phase Transitions in Digital Enterprise

Michael Gell

Effien Systems,
Ipswich, UK

Abstract

In some of the early developments of the internet, phenomena such as power laws and universal behaviours were observed [1-3]. These gave the impression that underlying the complex dynamics of the internet revolution, powerful principles of organisation were operating. Now an extensive network of webs has been left on which new dynamics are expected to develop as enterprises adopt more internet-mediated processes. In this paper, examples of potential future developments are presented, with a focus on the emergence of combinatorial and other forms of internet exchanges. These exchanges, identified as activated complexes [4], are shown to play a pivotal role in the development of digital enterprise through the next decade and provide a wealth of novel conditions under which complex systems can evolve.

To illustrate these dynamics, the architectures of combinatorial exchanges are described and it is shown how these relate to value-adding ladders of data, information, knowledge and complexity management. Self-similarities inherent in such architectures and in combinatorial enterprise processes play an important role in providing conditions for self-organised criticality and more general patterns of self-organisation. Various examples of self-organisation are illustrated and it is shown how these may necessitate advances in digital complexity management.

Examples are also shown of phase transitions, not only on a macroscopic (whole market) scale [5,6] but also on mesoscopic (enterprise) and microscopic (architectural and process) scales. Some of these transitions are illustrated in terms of polarisation waves emerging spontaneously across enterprise constellations. Novel forms of organisation [7] may emerge not only in response to the polarisation waves and other excitations but also the more general conditions of non-equilibrium [8,9] in the knowledge economy [10].

References

[1] Ko D & Gell M, 1995, Cable Franchise Growth in the UK, pp 397-406, European Transactions on Telecommunications, Volume 6, Number 4.

[2] Huberman B A, 2001, The Laws of the Web, Patterns in the Ecology of Information, MIT Press, Mass.

[3] Gell M & Adjali I, 1993, “Markets in open telecommunication systems”, pp 131-147, Telematics and Informatics, Volume 10, No 2.

[4] Kauffman S A, 1993, The Origins of Order – Self-Organization and Selection in Evolution, Oxford University Press, New York.

[5] Thom R, 1970, Structural Stability and Morphogenesis, Benjamin, Reading, Mass.

[6] Zhang W-B, 1991, Synergetic Economics, Time and Change in Nonlinear Economics, Springer-Verlag, Berlin.

[7] Gell, M, 2002, Organised eMarkets, Proceedings UKAIS Conference, Leeds, April.

[8] Prigogine I & Stengers I, 1985, Order out of Chaos, Fontana, London.

[9] Haken H, 1988, Information and Self-Organization, Springer-Verlag, Berlin.

[10] See also http://website.lineone.net/~michael.gell

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