24 Temmuz 2014 Perşembe

amazon review: Entropy: A New World View


by Jeremy Rifkin
Edition: Paperback

5.0 out of 5 stars Newton's Laws are over, we need a more realistic understanding for today & tomorrow even in business, May 19, 2014
I love the book. Keep in mind that it is authored in 1980 !!! I feel it has valid breakthrough ideas still !!

Newton Laws are from physics. They are over even in 1980 ! Rifkin introduces Thermodynamics Laws again from physics.
1st law : Energy is constant in universe, we could neither create nor destroy it, we could only transform it.
2nd law: Transformation has only one direction; from useful to not useful, from hot to cold, always to higher disorder = entropy.

In 1750 Jacques Turgot declared evolution towards “better”. For Turgot progress covers not simply the arts and sciences but, on their base, the whole of culture – manner, mores, institutions, legal codes, economy, and society.

Around 1690 Jon Locke interpreted government and society based on Newton’s Laws. He denied nature and hail to capital accumulation.

Around 1770 Adam Smith interpreted economy again based on Newton’s Laws. The major force was “invisible hand”.

Unfortunately around 1850 Darwin was misunderstood by science & politics and misinterpreted as “natural selection will favour only strong organizations and all others will fade away (pure monetarism)”.
[...] . Darwin witnessed that only higher forms which can absorb more energy from outside of their boundaries have chance to survive. This is very well fitting to an era of obsessed growth – push economy. It also yields more chaos which is the mean of more energy absorption. (So the organizations grow, they become more complex, they consume more energy, management becomes harder, stocks are signs of wasted energy)

Around 1950 Jacques Ellul stated “every new technic is arising due to compensating short comings of previous technics” in his book Technological Society. Recall flow centric view vs cost centric view, DDMRP vs MRP, mass production vs Lean / 6sigma/TOC,… [...]

Eugene Schwartz states “every half baked solution will even increase entropy and hence every new problem is harder to solve than previous one” (complex organizations required a calculator, MRP invented, complexity asks for more, ERP invented,…)

If in a local environment (within a boundary) we reach a limit of entropy than all efforts will be wasted to correct current malfunctioning system. We need to make it obsolete and switch a new one to improve (let cost centric view out and flow centric view in, from typewriter to PC, from coal to petroleum,…)

Energy flows, within the boundary it is natural for energy to flactuate, while transforming energy (in supply chain, from raw materials to finished goods, in stores) we will share it, waste it as well. To make energy flow smoother we first try to upgrade departments in the boundary, local efficiencies, resulting greater and more complex higher forms. Sooner or later these forms consume more energy than they permeate. Organization is too big to survive, dinasour naturally selected to dismiss. Uncontrolled multiplication of cells is known as cancer !

As Darwin points out we need to be simpler, more flexible, less consuming to survive..

As time passing mankind become slavery to computers, machines. It will be possible to produce more data than ever but it will be difficult to obtain relevant information ! (you can not operate anything against ERP in the company, relevant information is a requirement !!)

Everything in the world, in the nature is interconnected (consider a simple ecosystem, foodwebs, it is not chain but a web !!). It is sensitive and fragile (butterfly, bullwhip effects).

Newton’s Laws for dead substances but nature is alive, companies are like learning organizations and Newton’s Laws are no more valid. Learning and volatility drives organisms thru natural selection and let only flexible enough to dynamically changing environment organisms to survive. (no more static, everything is changing, dynamic).

Around 1950 Ilya Prigogine inserted dissipative structures. This is an early form of Complex Adaptive Systems. There are boundaries still but not isolated as in Newton’s case. They need energy to survive (companies need cash flow to survive), they are becoming more complex then their predecessors, complexity causes flactuations (we need to balance the flow, not the capacity as lean does), whole body is vulnerable against variation (we have buffers to protect us, variability is reality, it is unrealistic to try to kill it as 6sigma tries). According to Prigogine adoptability to changes is flexibility and is the key to survive (a dinosaur feel safe to survive since it is big, it has no interest to changing environment since it is big, it is not existing anymore since it is big). https://en.wikipedia.org/wiki/Prigogine

Thermodynamics points out equilibrum. In time natural selection in economy will cull dinasour companies and managers. Some companies will survive by their reflexes but those who are switching to simpler, more system-wide efficient, smooth flowing, not producing unnecessary stuff, not becoming oversized will lead the economy…

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