INFORMAL SYSTEMS THINKING OR SYSTEMS THEORY

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INFORMAL SYSTEMS THINKINGOR SYSTEMS THEORYMATJAZ MULEJ a , MAJDA BASTIC a , JANKO BELAKa , JOZICA KNEZ-RIEDL a , MARJAN PIVKA a , VOJKOPOTOCAN a , MIROSLAV REBERNIK a , DUSKO URŝIĉ a ,ZDENKA ZENKO a & Nastja Mulej ba Faculty of Economics and Business (EPF),University of Maribor, Maribor, Sloveniab New Moment d.o.o Bezigrad, SloveniaPublished online: 30 Nov 2010.

To cite this article: MATJAZ MULEJ , MAJDA BASTIC , JANKO BELAK , JOZICA KNEZ-RIEDL , MARJAN PIVKA , VOJKO POTOCAN , MIROSLAV REBERNIK , DUSKO URŝIĉ ,ZDENKA ZENKO & Nastja Mulej (2003) INFORMAL SYSTEMS THINKING OR SYSTEMSTHEORY, Cybernetics and Systems: An International Journal, 34:2, 71-92, DOI:10.1080/01969720302868

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INFORMAL SYSTEMSTHINKINGORSYSTEMSTHEORY

MATJAZMULEJMAJDABASTICJANKOBELAKJOZICAKNEZ-RIEDLMARJANPIVKAVOJKOPOTOCANMIROSLAVREBERNIKDUSKOURS› IC›ZDENKA ZENKO

Faculty of Economics and Business (EPF),University of Maribor, Maribor, Slovenia

NASTJAMULEJ

NewMoment d.o.oBezigrad, Slovenia

Systems thinking is the practice of holistic thinking, which can be informal or

based on systems theory. Success has always depended on holistic rather than

one-sided thinking. Empirical findings about the innovative society can ex-

emplify this statement, though there seems to be no universal agreement as to

This contribution is based on the research program ‘‘Innovative Enterprise in Transi-

tion,’’ which is sponsored by the Ministry for Education, Science, and Sports, Republic of

Slovenia, 1999–2003.

An earlier and shorter version of this contribution was granted the F. De P. Hanika

Memorial Award at the European Meeting on Cybernetics and Systems Research (EMCSR)

2002 in Vienna, April 2002. Coauthors were M. Mulej, Z. Zenko, V. Potocan M. Pivka,

D. Ursic and N. Mulej.

Address correspondence to Matjaz Mulej, Faculty of Economics and Business (EPF),

University of Maribor, P.O. Box 142, SI-2000 Maribor, Slovenia. E-mail: [email protected]

Cybernetics and Systems: An InternationalJournal, 34: 71^92, 2003

Copyright# 2003 Taylor & Francis

0196-9722/03 $12.00+ .00

DOI: 10.1080/01969720390180212

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what the basic attributes of systems thinking are, and we offer a summary of

them. To test them, we investigated an industrial latecomer country and

found that the understanding of both the innovative society and the systemic

thinking are rare: one-sidedness prevails. What do we do to come closer to

holistic thinking? Neither the General Systems Theory nor most other systems

theories (except the Dialectical Systems Theory) provide a methodology

supportive of holism; however, the case of the visionary companies proves

that informal systems thinking can be very powerful. Hence, systems theories

should work more on informal systems thinking.

THESELECTEDPROBLEMANDVIEWPOINT

To what degree does success depend on holistic thinking, and what is the

basis of holistic thinking? Let us try to answer this question with a case

and a comparison with a theoretical concept! Slovenia, a country in

central Europe, belonged to Austria–Hungary for centuries and, from

1918 to 1991, to Yugoslavia, which was established after the dissolutions

of Austria–Hungary and Turkey. Yugoslavia, a latecomer to indus-

trialization, tried to catch up with the advanced Northwestern World in

two quite different ways under King (1918–1941) and under Tito and his

successors (1945–1991). None of their methods were holistic enough to

succeed. Slovenia has been trying to succeed in a third way, after the

dissolution of Yugoslavia in 1991, to become an innovative society able to

enter the European Union (Eu) on equal footing.1 The making of an

innovative society is a complex process requiring systemic/holistic think-

ing based on interdisciplinary creative cooperation to succeed (even if self-

organization works well). According to the theory of the diffusion of

novelties aimed at becoming innovations, such processes need support

from many already approached ones2 (Rogers 1995). In a catching-up

country, such as Slovenia, self-organization is too slow, and creating an

innovative society is unavoidable and novel and imposed over the inher-

ited culture.3 What should be done and how?

1In its diplomatic language, EU requires Slovenia to be innovative in order to be ad-

mitted to EU (EU 1997). Slovenia is too small to make a well exploitable colony and would

require EU to support its two million inhabitants if Slovenia is not innovative enough on its

own.2If potential users find a novelty imposed, they can find many ways to disable it.3There is an empirical finding called the law of two-generation cycles: it takes about 70

years for a serious novelty to grow roots and change the old culture visibly (Mulej 1994). A

catching-up country does not have this much time.

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THENEEDFOR, ANDDEFINITIONOF, AN INNOVATIVE SOCIETY

It was mentioned previously in a foreword by Pretnar (Devetak 1980)

that Slovenia was warned that the worldwide span of extremes in national

per capita incomes had grown from 3:1 to over 150:1 from the mid-

nineteenth century to 1970. In the 25 years following 1970, this span grew

to >400:1 (Dyck et al. 1999). The gap continues to grow very quickly.4

From other work (Rosenberg and Birdzell 1986) we can learn that these

figures reflect the fact that (only) the richest countries of today have

implemented a social management innovation since the mid-nineteenth

century: they freed entrepreneurship and abolished guilds and feudal

relations with their centralized/hierarchical command culture in terms of

both ideology and economics (Grassby 1999). All citizens were entitled to

experiment on their own in the laboratory, production, and trading.

Thus, the essence of their innovation was political and economic

democracy, which enabled other innovations. One consequence is that

the 15–20% of the world population, who live in the innovative societies,

control about 95% of knowledge and investment in knowledge and

permanently increase their advantage before the less innovative societies.

A few other countries later joined the first countries. They deliber-

ately and skillfully implemented entrepreneurship and democracy on an

accelerated basis. They are catching up with the first countries quite well,

even though they started late. Their experiences teach that latecomers can

become parts of the innovative society.5 This need is publicly and offi-

cially accepted in Slovenia (UMAR 2001). What is the focus of the term

innovative society? A dialectical system of its operational attributes

includes the following (Mulej et al. 2000a):

4If one uses different data, the general conclusion does not change. ‘‘In 1960 the richest

one-fifth of the world population achieved a national per capita income that was 30 times

higher than one of the poorest 20%; in 1998 the difference rose to 78 times.’’ (Der Spiegel,

Hamburg, in ‘‘Profile of Demonstrators’’, Delo, Ljubljana, 28 July, 2001, 22).5Many mainstream authors dealing with the social consequences of the application of

modern computer equipment tend to think that the catching up can be done by leap-

frogging on the basis of its application. Most mainstream authors presuppose all people(s)

in the world want a rapid development of the western culture, but they do not consider the

given culture(s) enough, which cause(s) the given reality to become much less simple (Bucar

2001; Rogers 1995).

INFORMAL SYSTEMS THINKING OR SYSTEMS THEORY 73

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� a modern, creative democracy in society and organizations (freeing and

encouraging the creativity of many and encouraging holism through

the synergy of different opinions, etc.);

� amodernmarket (with supply exceedingperhaps far exceeding, demand);

� a modern understanding of ownership (not as the right to use and

abuse, but as responsibility);

� a modern understanding of innovation (whereby every novelty is

proven useful by users);

� a modern, innovative business involving most organizations (surviving

on permanent innovation);

� a modern, innovative entrepreneurship (not reduced to owning the

companies, but meaning an innovative discovering, creating, and ex-

ploiting of new opportunities); and

� a societal infrastructure supporting them (such as legislation, educa-

tion, culture, etc.).

Creating an innovative society is obviously complex and requires systems

thinking to avoid crucial oversights. (See Elohim 2002; Emmering 2002;

Mulej et al. 2002; Troncale 2002; Zenko 1999; Zenko and Mulej 1999.)

ASUMMARYOFATTRIBUTESOFSYSTEMSTHINKING

The few basic terms belonging to the concept of systems thinking in

summary, include the left column and oppose the right column in Table 1

[see Mulej et al. 2000a for background].

The following are short comments to each line in Table 1:

1. Interdependences, relations, interconnectedness, openness. The entire

biosphere, including humankind, has always had very many of these

attributes, in reality. Humans have not always perceived all of them,

as evinced by the occurrence of accidents, epidemic diseases, wars,

mistakes of other kinds, and so forth. Over the past centuries humans

have developed science to find out all possible information about the

biosphere. In order to find out details of the given facts and to use

them properly, specialization unavoidably, was needed to support

concentration on selected small parts of reality and its real attributes,

under the names of specific professions.6 It is crucial to know details,

6A related proverb reads: ‘‘What I know is a drop, what I do not know is an ocean.’’

But there is also ‘‘Due to caring for a single tree, one tends to forget about the entire forest.’’

And ‘‘The devil is in details.’’ They reflect informal systems thinking.

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but it is also crucial to remember that those parts of reality, details,

do not exist alone. At the Assembly of the United Nations in Fall

2000, the president of the United States found it necessary to say

explicitly: ‘‘We must not forget that we are interdependent.’’ (Two

centuries earlier, the United States passed a Declaration of In-

dependence! Independence is needed in legal relations, inter-

dependence in natural and economic relations.)

2. Complexity is an attribute of reality (and, hopefully, of the human’s

mental picture of reality) that expresses one type of entanglement.

What complexity denotes are attributes resulting from relations and

interdependencies; these attributes always exist but do not always

enter the mental picture, especially if the observer of reality con-

centrates on selected parts of this reality and observes them in isola-

tion. Complexity, on the other hand, denotes the other type of

entanglement, which applies to attributes of the parts alone, seen as

entities, while their relations with other entities are forgotten. Sim-

plicity (of picturing/modelling the reality, thinking, bases of decision

making, and action) surfaces when there is no entanglement or when

one is unable/unwilling to observe reality with all/many attributes of

its parts and their relations.7

Table 1. The basic seven groups of terms of systems/systemic/holistic vs. unsystemic

thinking

No. Systems/systemic/holistic thinking Unsystemic/traditional thinking

1 Interdependences, relations,

interconnectedness, openness

Independence, dependence, closeness

2 Complexity (and complicatedness) Simplicity, or complexity alone

3 Attractors No influential forces, but isolation

4 Emergence No process of making new attributes

5 Synergy, system, synthesis No new attributes resulting from relations

6 Whole and holism, big picture Parts and partial attributes only, analysis

7 Networking, interaction, interplay No mutual influences

7There is a proverb that reads: ‘‘When you feel capable of mastering a situation, and

when you feel incapable of it, you are equally right.’’ The same applies to admitting or not

admitting the real complexity or simplicity. It is your attitude that becomes the subjective

starting point of your action, its process, and its result, in both cases.


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3. Attractors. This expression can more easily be found in the chaos and

complexity theories than in the traditional and other systems theories.

It expresses relations and their impact; it attacks the opinion that

nature lives in isolated parts and finds that this opinion is based on a

crucial oversight. Especially interesting is the notion of strange at-

tractors, basically denoting the surprise of narrow specialists that

occurs when unexpected attributes surface, which they do not re-

cognize as specialists lacking a broader interdisciplinary cooperation.

4. Emergence. This expression, too, can more easily be found in the

chaos and complexity theories than in the traditional and other

systems theories. It speaks of the process resulting from interaction of

interdependent parts. Attractors cause the emergence of new at-

tributes, which are not typical of individual parts as rather in-

dependent than interacting entities. Investigation, which is limited to

complicatedness, discovers no emergence, because relations are not

investigated; emergence happens permanently anyway. We can dis-

cover emergence if we concentrate on complexity, interdependencies,

relations, and attractors, rather than on isolation.

5. Synergy, system, synthesis. These all denote the same reality; an entity

is made of two sets on mathematical formal terms: (1) the set of parts,

as components of the entity, and (2) the set of their relations, without

which the entity could not be different from its parts. Thus, synergy/

system results from the emergence of new attributes, which result from

mutual attraction/impacting/influencing/relations/ interdependencies

of parts, rather than from isolated individual parts.8

6. Whole, holism, the big picture. These are the central notions of systems

thinking. Systems theory surfaced and received public support in times

after the terrible destruction of the three-part process, that is, after the

two World Wars and the big economic crisis between them (1914–

1945). This destruction had been caused by the lack of holistic/systemic

thinking, which was one unfortunate and unforeseen side effect of the

unavoidably growing narrow specialization. Narrow-minded in-

dividuals (such as Hitler, Mussolini, etc.) were entitled to make deci-

sions with very broad consequences, including the deaths of millions of

people. Ludwig von Bertalanffy, the father of General Systems Theory,

8Troncale (2002) puts it well: systems science is the science of synthesis and integration.

It is not good enough for one to use systems thinking when defining something as a round-

off entity delimited from its environment and to call this a system.

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wanted to prevent the bad consequences of overspecialization and

wanted therefore, to provide for holism as a new world view rather than

as a science of its own narrow scope, for example, specializing in general

similarities only (Bertalanffy 1979; Davidson 1983; Elohim 2002).9 The

notion whole, on Bertalanffian terms, has demanded too much in terms

of capacities and felt needs of most individuals as specialized persons

and professionals. In addition, systems theory and cybernetics in those

times did not try to produce interdisciplinarity and interdisciplinary

creative cooperation, but rather isomorphisms. Isomorphisms (simila-

rities) have allowed for the transfer of findings and ideas from one

special field to another, and mutually different specialists can continue

working in isolation rather than in cooperation.10

7. Networking, interaction, interplay. These express practical paths from

one-sided/biased/locked-in/tunnel-vision specialization to the requisite

holism if we speak of humans and human action (see Mulej and

Kajzer 1998; Potocan et al. 2001, 2002; Rebernik and Mulej 2000). Of

course, all three notions also express the same process from the bio-

logical and natural viewpoints with no human intervention: trees,

bushes, other plants, animals of different kinds network/interact/ in-

terplay to make a forest, a river, an ocean, and so forth, similar to cells

in a living body, planets in the universe, and so on.

The seven groups of attributes in Table 1 make up a dialectical

system11 as shown, for example, in Figure 1. The seven groups of attri-

butes of systems thinking can be attained or missed, in practice.12 They

are easier to attain with a good formal background in systems theories,

but they may perhaps also be attainable without it, because they involve

9 We will return the discussion to Bertalanffy later.10This is both partly useful and partly insufficient for use by humankind to fight their

contemporary problems.11A dialectical system helps us attain the requisite holism. It is made of a set of view-

points that are found to be crucial and a set of their interdependencies. Thus, it provides a

middle ground between the impossible total system (full, real holism) and the often danger-

ous one-viewpoint system (fictitious holism). The word dialectical reproduces the ancient

Greek word for interdependence (see Mulej et al. 2000a).12These seven groups of (extreme) attributes apply to nature, technology, and society.

In society/management the left column results in conflict understanding and resolution,

counteracting the narrow-minded persons’ failure to accept otherness and their tendency

to exclude the different ones in conflict against the ‘‘unnormal’’ (Dyck et al. 1999; Elohim

2002; Jackson 1991; Ursic 1996).


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plain realistic thinking about reality. It all depends on the persons facing

a problem and trying somehow to solve it: they may find holism and,

hence, systemic thinking necessary to a higher or lower degree, con-

sciously or subconsciously.

How does the need for systemic thinking become felt in, for example,

attitudes about the need for innovation in a country that is a latecomer to

the modern industrial and postindustrial economy and life (which makes

up 80% of the world’s nations), and which suffered from bothWorldWars

and the worldwide economic crisis between them? Yugoslavia (1918–1941

and 1945–1991), of which Slovenia used to be a part, partly understood its

need for a holistic approach to an accelerated economic and social

development but was unable to really understand and apply systemic

thinking (see, e.g., Mulej 1981; Mulej et al. 2000a). What are the results?

ANEMPIRICALPICTUREOFATTITUDESABOUT INNOVATION INSLOVENIA

For centuries, until the independence of Slovenia in 1991, its inhabitants

used to be more under the impact of guilds13 than of the (modern) buyers’

market. The guild economy needs no innovation. On the other hand, the

buyers’ market economy thrives on innovation. On the general legal and

political level this received understanding and passive support in

Slovenia; but what about implementation by people and their subjective

starting points (values, knowledge, (use of) talents, emotions; see Mulej

Figure 1. The seven groups of attributes of systems thinking as a dialectical system (a very

simple version of their interdependence and interplay).

13In Tito’s Yugoslavia, Chambers of Economy played the role of guilds: a new pro-

spective competitor needed permission from the existing producers to enter the market. This

resulted in very few new enterprises except for the small handicrafts.

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et al. 2000a) with which they perceive and understand and support or

refuse the objective needs and possibilities in their environment?14

Our investigations15 (Mulej 1997; Pivka and Ursic 1998, 1999,

2000, 2001) show that in the decade since Slovenia independently

employed and developed its own innovativeness, entrepreneurship, and

democracy (as three interdependent subsystems of the same whole), the

capacity and readiness to interlink innovation, quality, and cred-

itworthiness of enterprises, or to interlink innovation, business quality,

and human resources development into an innovative business, an up-

to-date attitude about innovating has only been very slowly to

emerge.16 In 1999 and 2000 M. and N. Mulej performed two com-

parative empirical investigations. They took into account the interna-

tional finding that in the most entrepreneurial environments innovation

tends to surface as a very natural component of culture and business,

basis of quality, and, hence, of competitiveness, and thus also a basis

for good salaries (and purchasing capacity), investment, and the

capacity to survive in business and evolve into a modern society and

economy.

In the case of Slovenia, as already mentioned, EU requires Slo-

venia to be innovative in order to be admitted into the EU. These

requirements by the market and by the EU do not allow for a slow

modernization of Slovenians’ attitude about innovation. On the other

14Humans tend to pursue their objectives, but many neither think much about the

background nor think of the process of attaining their objectives. Unsystemic thinking fre-

quently results. We found that this process begins with the conscious/subconscious defini-

tion of one’s subjective starting points, which reflect one’s conditions and attitudes, and is

a dialectical system made of values and emotions, knowledge of contents and methods,

and backed by natural talents and their evolution based on education and experience. This

is the basis for one’s definition of the selected viewpoint/perspective that causes one’s selec-

tion of the perceived and the overseen attributes of the (piece of) reality under consideration

and leads later on to the selection of one’s preferential needs and corresponding possibilities/

sources/resources before objectives are defined—on a more or less narrow, one-sided basis,

rarely a systemic/dialectically systemic one.15A comparison of the management styles of the most innovative areas of the world

show that Slovenia belongs to the latecomers in innovating the management style (Zenko

1999).16Every major clause of ISO 9000:2000 is based on eight quality management princi-

ples, including the systems approach to management. Our research (Pivka and Ursic

2000, 2001) and experiences confirm that this approach is rarely considered and understood,

especially in small enterprises; the smaller the enterprise, the poorer the understanding of it.


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hand, an opinion poll (Tos 1999) demonstrated that 80% of the Slo-

venian population prefer a slow evolution.17 In other words, they

hardly support innovation. In spring 1999 another investigation

showed that Slovenian people do not value entrepreneurs highly

(Mocnik 1999).

We tested these findings with our own investigation on a smaller

sample (360 respondents). Our opinion research in 1999 covered a sample

of employed freshmen part-time students of the University of Maribor,

Faculty of Economics and Business (EPF), from all areas of Slovenia. In

a repeated investigation in 2000, new students (freshmen again) from two

of the most advanced and most exporting areas of Slovenia were sampled

using the same questionnaire. We intended to judge comparatively to

what degree a regional (and general) development of an innovative

orientation can be implemented if one considers the preceding innovative

society attributes as the central components of the system of values,

ethics, norms, and culture of the current way of economy and life. These

attributes are the least developed/modernized in the least modernized

regions, worldwide (Rogers 1995).

Our findings include the following results:

� The notion that market is a socioeconomic order providing the best life

to innovators is rare [5% in general (IG), 16% in the two most inter-

nationalized regions of Slovenia (IMIR)].

� The most visible sign that Slovenia is in its transition to a market

economy is rarely seen is an essential growth of the role and influence

of inventors and innovators (13% IG, 16% IMIR).

� Rare also is the opinion that it is a sign of Slovenia’s transition to a

market economy that in Yugoslavia, Slovenia used to have quite a few

inventors and innovators, but now the government supports the efforts

aimed at living on innovation more and more persistently and effec-

tively with its measures concerning education and economy (15% both

IG and IMIR).

17Several international oral discussions revealed the issue of whether or not the remain-

ing 20% can suffice. This issue remains unsettled. On one hand, our own experience shows

that change agents can more easily fail than succeed if they do not receive support from their

potential recipients, who can usually find a way around imposed novelties (see Rogers 1995).

On the other hand, the 80% are a big share of voters to whom political parties adapt them-

selves in order to be elected.

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� The biggest impact over the opinion of the respondents concerning

the importance of innovation in a market economy is ascribed to

television, newspapers, and radio (38% IG, 34% IMIR), less to co-

workers and bosses (24% IG, 21% IMIR), and the least to state

bodies (7% IG, 24% IMIR; the biggest difference between regions).

But only a minority receive no encouragement from anyone (20% IG,

18% IMIR).

� The modern attitude that private ownership means owners’ re-

sponsibility for a high quality of business prevails18 (53% IG, 70%

IMIR).

� The modern attitude prevails that entrepreneurship means capacity,

will, and action of people to combine, discover, and employ

opportunities to create something new and a new benefit19 (72% IG,

73% IMIR).

� What is also well represented, but less so, is the attitude that the or-

ganization in which respondents are employed works well, that is,

visibly and permanently takes care of modernization and updating of

creativity, knowledge, values, and chances to use them in a way that

most coworkers can, may, want, and nearly must innovate perma-

nently (40% IG, 50% IMIR).

The question, ‘‘Which attributes prevail in the practice of the orga-

nization you know?’’ was the first of two doublechecking questions. It

included 19 comparative descriptions of an entrepreneurial versus an

administrative practice. Responses show that the entrepreneurial practice

prevails over the administrative one, except when concerning the orga-

nizational innovations, managerial support to novelties, inventive

approach to problems, democratic spirit, and tolerance by managers.

Hence, modernity tends to look fictitious—so does holism. It is better

IMIR than IG.

The topic ‘‘Attributes of politics and strategies of the organiza-

tion you know,’’ including eight subquestions, is complementary to

the eighth question. From this viewpoint the difference between

situations IG and IMIR is significant: IMIR they value the long-term

policies and strategies more highly, but not reaching beyond 67%.

18It is not the owners, but young lower-level employees who responded to the question-

naire!19Again the same caveat as in Note 18!


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The lowest are the judgements about the human resources (HR)

politics (co-workers are the main source of success, long-term HR

development is unavoidable) and politics concerning dealing with the

problems (everyone will discover them and search for causes, rather

than for the guilty parties).20 Hence modernity and holism look

rather fictitious, again.

Our interpretation of the collected data is as follows. There are

important differences between regions that have been open to the

buyers’ market and other international impacts for the longest time,

showing the most development on one hand, and the other regions on

the other hand. This is true inside Slovenia and in the entire regions of

Central and Eastern Europe (CEEC)21,22. They face neocolonial dan-

ger. (See Kraljic 2002: ‘‘Slovenia is successful, but lots of work is still

waiting . . . By 2010 Slovenia must belong to the ten best nations in

the world in order to have further growth of its well-being and its

jobs.’’)

In Slovenia’s general population the attitude does not prevail that

one can speak of modern market and market economy, when the power

of the innovative organizations prevails, and serious difficulties of the

non-innovative organizations, individuals, regions, countries, interna-

tional areas result. Thus, the support to innovation-biased leaders may be

too small for the change of culture to take place with a sufficient speed,

depth, and breadth. Slovenia faces neocolonial danger.

Therefore, Slovenia may not be able to enter EU and the global

economy in general on an equal footing in time to avoid the danger of

being (neo)colonized.23,24

Government does not do enough to make people perceive that the

top leaders of Slovenia seriously aim at making Slovenia an innovative

20This part greatly devalues the first part of the response.21We do not want to speak of entire nations; differences within countries and nations

matter also.22For historic reasons, other areas of CEEC may be even less pro-innovative than

much of Slovenia (see Elohim 2002; Emmering 2002; Mulej et al. 2002; Troncale 2002).23It is interesting to see that much more knowledge is offered from the West concerning

private ownership, management, and technical expertise than entrepreneurship and innova-

tion management.24Globalization brings modernization to the most innovative economics, and coloniza-

tion to the noninnovative economics (Dyck et al. 1999; Elohim 2002; Forrester 1996, 1997;

Martin and Schurmann 1996; UNESCO Courier 2001 Dec.).

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society, not merely a member of EU and NATO. Not even the phases of

awareness/knowledge and persuasion have been reached, and of course

less so the phases of decision and implementation, belonging to the

innovation–decision process as discussed in the theory of diffusion of

novelties.25 This means the same danger.

Many organizations still believe that ownership and entrepreneurship

are one thing, and innovation is a different story, as is excellent quality of

business. They also consider innovation to be primarily an engineering

issue rather than a human resources one. This means that they still

consider it a hobby of very specific individuals rather than an integrating

and unavoidable process. This is a very obsolete attitude enhancing the

neocolonial danger. The especially underestimated issues are the orga-

nizational and managerial innovations, with which the top powerholders

would give up a part of their power (and carry less burden) by freeing and

developing creativity of their subordinates and by directing it toward the

creation of benefit for the organization. Making the modern values seeing

innovating, modern perception of market, democracy and entrepre-

neurship as the basis of modern business, economy and life of a high

quality level, is therefore too slow. This requires action in order for

Slovenia to avoid said danger.

Some positive, that is, innovation-based changes are visible in the

time after this research (Bole 2002; Cuk 2001). The exchange economy

companies contribute to Slovenia’s inflation under the average, but this

may be a sign that they work on cost-reducing innovations rather than on

uniqueness-producing ones (Bastic 2001).26

Very similar findings were demonstrated in a number of other

investigations (DEZAP, 2001; Mulej and Mulej 2000; Rebernik et al.

2001; Stanic et al. 2001; ZRS 2001): one-sidedness, obsoleteness rather

than systems thinking in terms of Table 1 and Figure 1 prevail. What

should be done toward a requisite holism?

25Transition from a routinized to an innovative society is a radical innovative process

needing a lot of conscious diffusion to really take place and to do so in time for the catching-

up latecomer countries/regions (see Mulej et al. 2002; Rogers 1995).26Four phases have been identified in the development of criteria of the ideal enter-

prise. In the 1960s the efficient phase cared for lowest possible cost. In the 1970s the quality

phase added care for quality. In the 1980s the flexible phase added a range of products/ser-

vices offered. In the 1990s the innovative phase added uniqueness. Only the enterprise in the

last development phase (so far) unites all four attributes and produces the best basis of com-

petitiveness (see Bolwijn and Kumpe 1990). We call it ‘‘systemic quality.’’


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THEGENERAL SYSTEMSTHEORYOROTHERSYSTEMSTHEORYAND/OR INFORMAL SYSTEMSTHINKING�WHAT TOUSE?

Since his first famous research as a biologist and mathematical

biologist since 1928, Bertalanffy has gradually become the founding

father of the General Systems Theory (GST). This notion is called a

theory, which might remind us of time-free findings about time-bound

features, events, processes, and attributes. In Bertalanffy’s view, GST

is not rightly called a theory [Elohim 1999, 2000; after Davidson

(1983) and other references and sources]. What Bertalanffy required

was for GST to become a teaching (‘‘Lehre’’) as a new world view,

which would ask all of us:

� to feel and act as citizens of the entire world, not just individual

nations;

� to consider the entire biosphere as one system/whole; and

� to see the planet Earth as one organization, a whole with attributes

emerging from interdependencies, sometimes mutually reinforcing,

sometimes mutually opposing, between its parts by their interactions.

This Bertalanffian notion actually warns that limitations of human

thinking and resulting actions cause too many oversights for the bio-

sphere, including humankind, to have a good chance to survive rather

than to disappear, sooner or later. Obviously, Bertalanffian ideas and

findings have not received sufficient attention and consideration over the

past five decades (Unity 2001).

Bertalanffy (rightly) required holism that we might initiate a total-

system approach.27 To most people, this is more than they find requisite

in their own work and life framework. The idea of the GST as a very

broad world view has gradually become a formal methodology trans-

ferring important insights from one specialized discipline to another and

letting them benefit from transfers rather than from interdisciplinary

cooperation (see Elohim 2002; Emmering 2002; Mulej et al. 2002;

27Literally, the word whole means ‘‘the entire amount or extent, not a fractional one,

but an entire, undivided one, i.e., a complete thing’’ (Webster 1978). Specialists, of course,

limit this notion inside the viewpoints they select and forget about other parts or attributes.

This makes them blind (Oshry 1996), one-sided, and fictitiously holistic. But it may be

enough, sometimes, that’s why we voiced the law of the requisite holism (Mulej and Kajzer

1998; Potocan et al. 2001, 2002; Rebernik and Mulej 2000).

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Troncale 2002). A lot of benefit results, but the concept remains far from

Bertalanffy.

Systems thinking that is supposed to be the practice of holistic

thinking becomes partially holistic.28,29

Systems theory, as its theoretical reflection and background, becomes

supportive of such partial holisms, in practice.30

Reductionism, which has been a very useful, but one-sided rather

than holistic, scientific approach for several centuries, is fortified rather

than partly replaced and partly complemented with a more holistic,

interdisciplinary, and transdisciplinary approach.31

The resulting novelties, even if they become innovations, are partial

also, and cause many bad side effects.32

The traditional human selfishness is unavoidable and supported.

But humans need to include more interdependence into criteria of a good

work and life to be able to survive (Joyce 2002; Mulej et al. 2000b).33

Such practical shortcomings of a—basically—very insightful theory

let other methodologies of holism surface inside and outside systems

movement (Jackson 1991), which we do not discuss here (see

Mulej et al. 2000a). No theory assures a Bertalanffian style of holism

alone; some offer more methods/room for it, such as Mulej’s Dia-

28As long as only partial problems are tackled, this may suffice. But it may lead to sub-

optimization, which may work against a holistic optimization. A business case: seeing fi-

nance with versus without marketing, or production and human resources with versus

without their interdependencies, and so forth.29The notion partial, in this context, does not mean partial systems as an alternative to

subsystems, but holism covering only parts of attributes that really exist.30In both the personal contacts and texts by a number of authors we have read from

around the world, we have rarely come across the notions of interdependence and interdis-

ciplinarity. Several authors tend to discuss transdisciplinarity in a way such that the general

attributes from different disciplines are searched for isomorphisms, rather than cooperation

of mutually different disciplines and, hence, viewpoints (see ISSS 2001).31Every specialization in both practice and science is (unavoidably and also usefully, to

some extent) limited to reducing the total amount of the really existing attributes to the ones

that are exposed by the specialists’ selected viewpoint. In formal mathematical terms holism

is kept, in reality it is fictitious.32Solving a rather narrowly defined problem often brings a new solution that can

hardly cause only the foreseen consequences. Some interdependencies and resulting/emer-

ging synergies may very frequently be overlooked (see UNESCO 2001 Sept.).33We do not dare speak for altruism. We mention interdependence as the precondition

for the selfish interest/self-interest to be met; for example, your personal experience may

state that you tend to avoid a supplier with whom you are not satisfied.


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lectical Systems Theory, Jackson and Flood’s Critical Systems

Thinking, or Beer’s Viable Systems Theory. No systems theory

monopolizes application by all successful persons, of course. Outside

them, quite a lot of informal holistic systems thinking must both be

present and lacking, dividing peoples and organizations into the

successful and the unsuccessful.

THECASEOF VISIONARYCOMPANIES�INFORMAL SYSTEMSTHINKINGAT WORK

Collins and Porras (1994, 1997; and later, with a bestseller status in

many countries around the globe) demonstrated (indirectly, tacitly,

informally) that a good business depends a lot on systems thinking,

even without using a single word of systems theory. They first asked

700 CEOs in the United States that are members of the best com-

panies around the world. Then they studied close to one hundred

thousand pages of documents by and on the companies selected as

best over a long term, on average, a century. They shattered the

twelve established myths and they empirically introduced new gen-

eralizations introducing a lot of informal systems thinking as the

background of their success (as we see it). They studied the selected

companies from their very beginnings through all the phases of their

development to the present day. And they studied them in compar-

ison to another set of good companies that had the same opportu-

nities, but didn’t attain quite the same stature. They kept asking the

question ‘‘What makes the truly exceptional companies different from

the other companies?’’ They answered this question from a dialectical

system of viewpoints (as we would put it). They attribute their

success with readers to four primary factors (Collins and Porras 1997,

xiii–xvi):

� First, people feel inspired by the very notion of building an enduring,

great company.

� Second, thoughtful people crave time-tested fundamentals; they’re

tired of the ‘‘fad of the year’’ boom-and-bust cycle of management

thinking.

� Third, executives at companies in transition find the concepts in Built

to Last to be helpful in bringing about productive change without

destroying the bedrock foundation of a great company (or, in some

cases, building the bedrock for the first time).

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� Fourth, there are many visionary companies out there, and they’ve

found the book to be a welcome confirmation of their approach to

business.

The less successful companies work on much more one-sided bases, and

have much less success. The research reported here demonstrates

the same findings, including the explanation of why the economies of the

latecomers to the buyers’ market keep lagging behind the most advanced

ones.34

SOMECONCLUSIONS

The need for holism (by systems thinking) has been stated. This

means that practice, sometimes also theory/science, lacks responses to

this need, and humankind’s capability demonstrates holes rather than

wholes, even under the name of holism. So it is also in the case of

the modern business: the principle and requirement are clear, the

methodology lacks, and so does the world view. Specialized sciences

do not allow room for systems theory to be taught very much (e.g.,

Elohim 2002; Emmering 2002; ISSS 2001; Mulej et al. 2002; Troncale

2002; Unity 2001). Still, successful people do think systemically,

holistically; unsuccessful people do less so. In Slovenia, and around

the world, very few schools seem to offer systems thinking in formal

courses. Specialists teach courses educating specialists. Inter-

disciplinary courses and associations hardly exist. In Slovenia, as a

case, consequences are easily visible: linking neighboring attributes is

a very difficult task, even for high school graduates who work and

study. Linking them in the rules of ISO 9000/2000, EQA 2000, EU

(2000), and linking success with systems thinking in official docu-

34Our research group has tried to help them by creating the Dialectical Systems Theory

(Mulej), Business Cybernetics (Kajzer), and (partially resulting) models of requisitely holis-

tic entrepreneurship and economics of innovation (Rebernik), organizational systems theory

(Ursic), business quality assessment and promotion (Pivka, Ursic), business decision making

(Potocan), comparative innovative management research (Zenko), creditworthiness assess-

ment and environment economics (Knez-Riedl), business policy (Belak), operation research

applied to product innovation (Bastic), optimization of environmental care in business (Bas-

tic, Cancer), making/enhancing innovative business and innovative society in a catching-up

social environment (Mulej et al.), and so on. See references on an example basis, and CO-

BISS for details.


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ments is also very new worldwide. Therefore, systems theorists should

do more work to develop informal systems thinking (see several

contributions: Elohim 2000; IDIMT 1993; Mulej and Kajzer 1998;

Petzinger 2000; Pivka and Ursic 1998).

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Documents

INFORMAL SYSTEMS THINKING OR SYSTEMS THEORY