Class 8
Section VIII - System Theory and Business
1. Basics of System Theory
2. Mechanics of System Theory
a. Chaos
b. Complexity
3. Species Diversification & Weeding Out
a. Examples in Nature
b. Examples in Business
4. What Nature Can Teach Us About Business
5. System Dynamics
a. Flow / Agents / Resources
b. Flawed Models
c. Value of System Approach
6. Random Notes
a. It’s all Connected
b. A New Kind of Science by Stephen Wolfram
c. Complex Adaptive Systems (CAS)/ Santa Fe Institute
d. Nature Pictures
Guest Speaker(s):
In-Class Presentation(s):
What Nature Can Teach Us - Part I – Spring 2014
What Nature Can Teach Us - Part II - Spring 2014
System Dynamics – Spring 2014
Reading Assignment:
"Still Powerful - Hidden Order”, Michael Mauboussin
“Fill and Kill", Michael Mauboussin
“Blowin Up”, Malcolm Gladwell
“The Uncertainty Principle”, Thomas Bass
Section IX- Network Dynamics in Business
1.The Rise of Networks
a.Why They are Important
b.Mechanics of Network Foundation
c.Network Economics / Cost Characteristics
d.Corollary with Natural Systems
2.Mechanics of Networks
a. Increasing Returns
i.Network Effects / Metcalfe’s Law
ii.Positive Feedback Loops
iii.Critical Mass
iv.Crossing the Chasm
b.The Tipping Point
i.The Stickiness Factor
ii.Law of the Few
iii.Power of Context
3.Examples of Networks
a.Travel Industry – Sabre
i.Internal Networks (Employees)
ii.External Networks (Customers, Partners)
b. New Networks
4.The Rise (and Fall) of Information Networks
a. Importance in the Economy
b. Business Models Enabled by Information Networks
5. Value Chains within Business Networks
a. Claiming Space on the Value Chain
b. Building a Partnership Portfolio
Guest Speaker(s):
In-Class Presentations:
Rise of Networks – Spring 2014
Reading Assignment:
“Increasing Returns and Two Worlds of Business,” Brian Arthur
“Positive Feedback in the Economy,” Brian Arthur
“Approaching the Chasm”, Geoffrey Moore
“Strategies for Platform-Mediated Networks,” Thomas Eisenmann, Geoffrey Parker