There are two elements that any business needs to survive and grow: Emergent properties and Variety. Without continuous evolvement and growing of those two, any business doom to fail.
Every person brings skill sets and competencies to the working environment, but when you are grouping people there are new properties created or raised to a different level by the group, but not by individuals in the group will have those properties (on the same level that the group will have them). Security is an emergent property provided by the group. Innovation is an emergent property increased significantly by a group. Being able to identify needed emergent behavior and create them in a group, or even to see the working environment as a group of emergent properties is a gift. Adding people, to a certain degree, increase emergent properties. Organization structure also has a significant impact on emergent properties.
Ashby’s law brings us the concept of variety. In a nutshell Ashby’s law claim that If a system is to be stable, the number of states of its control mechanism must be greater than or equal to the number of states in the system being controlled. In the business world, states of an organization are also positively impacted by the number of resources the organization has (including people). Also, it is enough that one business will have more verity over its competitors to control a market. It’s sporadic that one company will gain variety bigger than market variety. Variety (as emergent properties) is positively impact also by the number of people the organization has.
More people brings us to the third element, complexity. Complexity is defined as a system that is hard to understand and extremely hard to predict its behavior. As we are adding more elements to a system, we are increasing the potential interactions between system parts, and therefore we are increasing the complexity of the system. To put it simply, adding more people to an organization increase (exponentially) the complexity of a system.
When complexity is growing too much chaos started to emerge, and too much chaos will eventually take a system (or a company) down. Therefore as complexity grows organizations need to put more resources to reduce complexity or to limit chaos to a tolerable level. The problem is that available resources are limited and resources will always grow linearly comparing to an exponential growth of complexity.
Complexity requires more resources to reduce it and therefore create a vicious loop (more resources, more complexity, more resources needed to reduce complexity). On top of that, the business environment and competitors are increasing variety all the time. Increasing complexity in the business environment required increasing complexity inside any company, which increase the growth of complexity even more.
Without any intention to complexity reduction, an organization will reach its resource limitation, causing chaos to reach a level that will take the company apart.
The need to create and increase emergent properties and to increase variety, without growing too much complexity should be the focus of companies that want to survive and thrive for a long time (more than the 15 years average).
If you are a manager in any organization, your focus should be on emergent properties, variety, and complexity. Once you start to muster those three, you’ll find out that focusing on people as the problems of your organization and replacing them with other people is contradicting for achieving the balance between emergent properties, variety, and complexity.