8
Complexity and the Theory of Organizations: Applications

The notions discussed in the previous chapters are now illustrated through a compendium of application examples which offer a variety of situations. From these applications, we will draw useful lessons for the practitioner plus guidelines on how to better control complex systems in the field.

8.1. Applications: trends and models

8.1.1. Application of the principles to steering systems

A complex system consisting of a set of interacting elements must have a synchronic structure (i.e. where events and facts occur at the same time in different places) such that emerging properties (additional and global) can appear. It must also remain within the boundaries of freedom and action (autonomy) and include elements as well as a network of relationships, feedback loops and organizational levels (subsystems).

Such a system is therefore defined by its autonomy and internal relationships as well as its relationships with the environment and other systems. At this stage, there is no system without regulation, i.e. without a protocol allowing it to maintain itself between stability (homeostasis) and change (adaptation), as found in morphogenesis, evolution and learning. In terms of organization, we cannot have a simplistic structure: for example, in complex systems, the feedback system shows that authoritarianism and one-way communication are not appropriate; however, nothing prevents the organization filtering information.

As a natural consequence, scientists have turned to more appropriate models, which we will study.

8.1.1.1. Flexible and reconfigurable workshops

Various studies have examined decentralized structures in production systems. Their contributions are in the development of the architecture, the design of negotiation protocols between entities and industrial applications. The use of heterarchical and cooperative architectures are alternatives to hierarchical architecture [HAT 85]. In this context, it has been possible to define, through IBM’s PIAUL project, “expert” rules of behavior, local goals and global goals (that autonomous entities follow) in order to prevent anarchy and chaos in the system.

Shaw described a distributed control structure for dynamic scheduling in a cellular manufacturing system (CMS) [SHA 87]. The architecture of a CMS consists of three types of units or “cells” (warehouse cell, pallet cell and robot cell) (see Figure 8.1). Each cell acts independently by exchanging messages, and each cell controller maintains this local information, but without global control. The assignment of tasks is carried out dynamically by negotiation between the cell controllers. The scheduling of tasks in each cell is done locally. Recent work by Kondoh et al. has proposed a heterarchical structure for the CMS [KON 00, TOM 97, MAS 01d]. These authors consider the CMS (Cellular Manufacturing System) principle as a rapid prototype for design and as a decision support tool for configuring and assigning tasks at the resource and product levels.

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Figure 8.1. A “cellular manufacturing system”

Configurations and assignments of parts and resources are determined by self-organization mechanisms between the different entities at operational level. This evolution towards more autonomy for production units naturally leads us to consider this approach as a framework for the application of heterarchical control systems.

Coordination between the independent entities of a heterarchical structure is an essential point to be considered when managing a system. We can ensure this through predefined rules (centrally or not); we can also leave this coordination “open”. This is generally the case with our approach and was implemented in network structures where agents use communication protocols based on market paradigm bidding principles to meet their objectives. The canonical example of a standard negotiation protocol is the Contract Net Protocol (CNP) developed by Smith [SMI 80]. It has been widely used by various works using heterarchical architectures, and has been extended through different auction mechanisms [FIP 00, LIU 02] and negotiation protocols.

Hence, the heterarchical architecture is used for the management of a production workshop in which products and resources are considered as agents. Each agent negotiates with the other agents, in real time, through the principle of an exchange market, in order to satisfy its individual objectives [LIN 92]. When a customer requests a service provided by an organization, a cost in exchange currency is required by the organization. This model uses a generic construction mechanism for exchange offers during negotiation between agents, based on the principle of combining price and objective (time, cost, quality, etc.). This architecture, through simulations, reveals a great flexibility and adaptability in the real-time management of a production workshop.

A decentralized architecture for the management of a production workshop [PAR 98a] with resources, a manager, product type and processing unit has been developed with intelligent entities or intelligent agents who know “how to combine products and resources for the manufacture of other products”. In this structure, the authors provide a mechanism for direct dialogue between clients and the production workshop for “mass customization”, using intelligent agent technology.

Finally, the European PABADIS project – Plant Automation Based on Distributed Systems – was a recent example of a heterarchical architecture designed for industrial applications. The PABADIS system uses a decentralized organization for the automatic and dynamic reconfiguration of production lines [PAB 00]. It aims to improve the management of a decentralized production system by using the notion of “plug-and-participate” and the total or partial elimination of planning and scheduling tasks. The basic components in PABADIS are agents and services. Agents and services cooperate to accomplish the tasks to be performed.

Advantages and disadvantages

The main advantages of heterarchical structures can be summarized in the following four points:

  • – reduced software complexity;
  • – improved fault tolerance;
  • – easy maintenance, modification, reconfiguration and human intervention;
  • – facilitated and more consistent level of knowledge of the characteristics for each part of the production system.

The decentralization of decision-making in heterarchical structures also has some disadvantages. We can point out that:

  • – the prediction of overall system performance and individual entity behavior is difficult, if not impossible to achieve [MAS 01c];
  • – the overall performance of the system is extremely sensitive to the definitions and choice of local rules and negotiation protocols between entities. This is due to the interactions that make the “sensitive to initial conditions” (SIC) system and quickly converge in a basin of attraction that is difficult to predetermine.

8.1.1.2. Hybrid steering structures

The hierarchical and heterarchical structures we have described have both advantages and disadvantages for the management of distributed production systems. For this reason, some research has tried to preserve the advantages of both structures by proposing a new “hybrid” structure (Figure 8.2).

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Figure 8.2. Hybrid structure

In the hybrid structure, control units of the same hierarchical level are interconnected via the same control fixture. They are able to communicate and cooperate to meet their local objectives. During disruptions, all control units can ask their checking fixtures for help in solving the problems detected. In this model, control units require the assistance of higher-level control units in the event of non-compliance with their local objectives due to unexpected disruptions. Ottaway and Burns propose an adaptive production control system (APCS), similar to the so-called CAS systems, as seen in Chapter 6. Within this adaptive context, the transition between heterarchical and hierarchical structure occurs dynamically and is based on the system’s workload [OTT 00]. In their models, these authors consider the three types of agents: task, resource and supervisor agents. Each agent has knowledge of the coordination, production, interface and inference engine. When an agent notes that the resource it represents is not being properly used, it asks for a monitoring agent to control the resource. In this way, a hierarchy level is dynamically introduced into the system.

MetaMorph, a hybrid agent-based architecture for controlling distributed production systems [MAT 99], uses two types of agents, the resource agent to represent physical resources and the mediator agent for coordination between resource agents. We have added hierarchical mediators and cooperative negotiation mechanisms between resource agents to our model. Recent hybrid structures include the holonic manufacturing system (HMS). The basic principles of holonic systems were introduced in 1967 by Arthur Koestler in his book The Ghost in the Machine [KOE 67]. Koestler introduced the idea that a few key principles were sufficient to explain the ability of social and biological systems to regulate themselves. He proposed the term “holon” to describe the basic element of these systems. This word combines the Greek root “holos”, which means “whole”, with the suffix “on”, or “part”, as for proton or neutron in an atom.

The HMS system appears more like the search for a compromise between integrated or hierarchical organizations, on the one hand, as already coherent units within a system, and on the other hand, distributed or heterarchical organizations as reactive parts to the environment of this system. This interpretation is recent [VAL 99] for the concept’s production systems. Its purpose is to satisfy the adaptability criteria required by the new generation of production systems (Next Generation Manufacturing System) [KUR 96]. It was generally introduced by the IMS (Intelligent Manufacturing Systems) initiative launched by Japan in 1989 [KIM 97]. The “holarchical” structure resulting from the arrangement of these production holons can be considered as the compromise between a hierarchical structure and a heterarchical structure insofar as the cooperation of low-level “intelligent” holons remains nevertheless coordinated by hierarchically superior holons.

Brussel et al., Valckenaers et al. and Wyns present the PROSA architecture (Product-Resource-Order-Staff Architecture) as a holonic structure for production management [WYN 99]. Among the examples of holonic architecture is the PROSA (Product-Resource-Order-Staff Architecture) for production management, developed by the research group at the Université Catholique de Louvain in Belgium [BRU 98]. PROSA is a holistic HMS production system designed to achieve stability despite disruptions, flexibility, adaptability to change and efficient use of resources. This architecture includes three basic types of holons: order, product and resource, as well as a staff holon. Each of the basic holons is responsible for logistics, technological planning (including process planning) and the determination of the resource’s capabilities, respectively. The staff holon is considered an external expert who provides advice to the basic holons. They can provide centralized algorithms for scheduling and help basic holons. By including staff holons in the structure, the system has a hierarchical management behavior that can improve its overall performance.

Advantages and disadvantages

By combining the two hierarchical and heterarchical structures, the hybrid structure can benefit from their respective advantages simultaneously. In this way, it combines both robustness against disturbances, through local interactions between heterarchical agents with global optimization, and prediction through hierarchical supervision agents. The major disadvantage of this structure is the great experimental difficulty in finding the right compromise between supervision at the hierarchical level and the degree of autonomy attributed to heterarchical levels. The ideal compromise sought must facilitate stability and adaptation to change (dynamics, disruption, chaos, etc.) in a complex environment.

8.1.1.3. Discussion

After examining the characteristics of current research on organizations, as well as the advantages and disadvantages of the various existing steering structures, we find that there is no ideal generic steering model that can be used at any time and in all environments. Each structure can be effective for certain types of problems and environments depending on the context, dynamic and time constraints, etc. We should also note that, contrary to what specialists frequently think, the physical structure of a system can be organized in one way and its information system in another. Thus, a hybrid network or an n-cube system does not exempt from prioritizing information, otherwise the system will quickly overload. In this case, the frequent removal of hierarchical levels is not necessarily the right approach to reduce complexity.

Our work here focuses on self-organization mechanisms between autonomous entities through negotiation protocols and cooperation mechanisms (e.g. remember that coopetition = cooperation + then competition). These approaches can be applied for the dynamic allocation of resources in a dynamic and situated environment, between the product and resource entities of a production workshop and considered locally. The most appropriate architecture for these concepts is a heterarchical one. Its specific characteristics have allowed us to apply and validate different concepts and mechanisms with more freedom of interaction and simplicity of modeling. These concepts have been developed to involve interactions between autonomous entities in located dynamic environments. However, we can also apply these concepts with hybrid control architectures and with a high degree of autonomy of the production units. As a practical example of heterarchical architecture, we mentioned the European PABADIS project, in which our LGI2P-EMA research center at the Ecole des Mines in France was a partner. This architecture allowed us to test and validate the concepts developed.

In the following sections, we will explain the techniques and algorithms that can be used to control heterarchical production systems.

8.2. Application and implementation of concepts in the “Fractal Factory”

8.2.1. The case of the Fractal Factory – organization

Conventional approaches in business organization seek to define the production process based on the technical specifications of the products. Once the factories have been designed, it is a matter of improving them through techniques such as quality circles or working groups. Workers are valued through participation and accountability in the results of their processes. On the other hand, to intervene when necessary, or when a bottleneck occurs, the notion of “skill versatility” is developed.

To further develop this concept, Hans Jürgen Warnecke’s team [WAR 93] at the Fraunhofer Institute in Germany developed the concept of the Fractal Factory. The three initial hypotheses are as follows:

  1. 1) companies are networked and subject to conflicting pressures. Rather than fighting these constraints, it is more beneficial to integrate them and develop coping skills to adapt to change;
  2. 2) chaos should not be considered as an exception but as a predictable principle. It is therefore advantageous to identify the factors and entities that generate structures conducive to the emergence of deterministic chaos;
  3. 3) in systems with fractal structure or symmetry, there is invariance of form and pattern. It is therefore easy to detect sparks, shape fragments or initial irregularities or breakage factors.

By combining the principles developed in Japanese industry with the approaches developed by Dr. Warnecke, a methodology based on the following principles can be defined:

  • – in a complex production system, the best way to integrate chaos into the operations of that system is to adopt the same behavior and be as close as possible to it;
  • – a Fractal Factory is made up of multiple autonomous, small, flexible teams of identical configuration. Within these teams, all operators are versatile and able to replace each other and swap tasks;
  • – in terms of scheduling, we do not need local scheduling: each worker in a cell organizes his or her work according to the orders that are directly transmitted to the cell;
  • – in the design or re-engineering phases of the production system, each agent participates in the development of the new process, working cooperatively with his or her colleagues from different backgrounds (methods, purchasing, IT, quality, etc.).

We therefore have a very dynamic process capable of integrating changes and stimuli of chaotic types. The approach used to improve processes was initially applied at the Mettler-Toledo Factory in Baden-Württemberg in the late 1980s. The operation consisted, first of all, of improving and bringing a process up to standard, more explicitly to:

  • – reduce the company’s non-strategic business processes. This tapering off consists of taking the upstream workshops out of the company (preparation, pre-treatment) and reducing stock;
  • – reorganize, in a “fractal” mode with light and autonomous teams. This consists of taking charge of the entire order and downstream control;
  • – merge homogeneous services such as process engineering, methods and manufacturing;
  • – also merge marketing and research;
  • – ensure the study and development of new models by small teams (from 7 to 14 people); these teams also ensure the maintenance and evolution of the model.

As a result, the flexibility, reactivity and creativity of this type of company are improved and allow variations in production rates ranging from -50% to +200% of the nominal value. This approach has also improved the motivation of those heavily involved in the product life cycle. In addition, in production, the distribution of time required to assemble the products remains centered, with variations of less than 20%.

8.2.2. Consequences for production management

The aim here is to address some problems in the organization of distributed manufacturing lines. With regard to the management of complex systems, it was observed that deterministic chaos (at inventory level, for example) was a fairly common phenomenon. This is the case, for example, in semiconductor lines (like at IBM) or in flexible workshops (like at Siemens). When confronted with this situation, the production system is modeled as if it were a set of continuous flows [TÖN 92]. These systems are located at the boundary between regularity and chaos.

The main principles we are going to apply are only a reminder and an overview of points that we have developed previously. These apply equally well in organizations with a fractal structure or operating in peer-to-peer mode. We will therefore proceed as follows:

  • Scheduling. Scheduling techniques are not applied as in a discrete, regular and deterministic system simply because they are not applicable! Indeed, the nature of the agents involved is varied and one principle is to act not only on products but also on the configurations and behaviors of clients and suppliers. We cannot therefore simultaneously address so many constraints and contexts and at best only react to disruptions by playing on reconfigurations and opening up opportunities through auction-based techniques.
  • Sensitivity to initial conditions. In such systems, there is always a strong dependence between the parameters that describe a distributed workshop and the emergence of chaos [MAS 95b]. The result of behavioral simulation has always shown extreme sensitivity to even small structural changes (configuration) and model-related inaccuracies. Indeed, the sensitivity of chaotic systems to initial conditions and disturbances causes amplifications, most often nonlinear, which constitute their informational capacity. This allows these amplifications to be controlled: thus, a microscopic structure allows a macroscopic structure to be controlled. As a result, when chaos appears, it can never be precisely determined when and why it appears. This explains why it has always been difficult to prove exactly if and when chaos really appears. We consider here that we are between a regular state and deterministic chaos, but we can never predict when we will cross the boundary.
  • Decouplings. One solution is to stay away from this boundary with some common sense rules:
    • - the capacities and resources available in a sector of activity must remain autonomous and independent, as far as possible, from each other, in order to reduce the connectivity of the graph. Similarly, where possible, the sharing of certain resources from one sector to another should be avoided for the same reasons and also to improve the productivity of the system;
    • - an attempt will be made to physically decouple manufacturing sectors from each other in order to limit their interactions. In order to ensure a regular virtual flow, as many operations as possible will be concentrated on a reduced multi-purpose cell.
  • Use of resources. Because of the sensitivity to initial conditions (SIC) of such systems, equipment use rates which come too close to saturation should be avoided. Always. Thus, in complex production systems, an attempt will be made to stay below an 85% threshold. An interesting example at global scale is the Swiss Federal Railways company that always freezes 20% of its staff resources upfront: agents come in handy if and when a chaos (crisis, rescue, etc.) happens.

Discussion

The configuration, or dynamic reconfiguration, of distributed production systems should take into account the criteria set out above. However, there is one condition that has not yet been met and it is the one that leads us to self-organization. In a simplified way, self-organization is a process of selecting and eliminating the worst performers. This selection is accompanied by local variations and optimization, which, in the scheme of evolution and natural selection, only explains minor adaptations and not qualitative leaps. Cooperation and immediate need are not sufficient conditions and in fact require competition between groups, with adaptation strategies, in order to have the best access to resources.

This therefore requires, as we saw in a previous chapter on the emergence of chaos, dissipative structures, i.e. structures capable of diffusion: a phenomenon that makes it possible to homogenize components, inhibit or activate characters, in short to create differentiation, forms and order. This order therefore emerges from the interactivity of the entities and does not pre-exist to the entities that constitute it.

What forms a society and structures the relationships between its entities is therefore social rules, or meta-rules, which define a framework for action, spaces of freedom or instructions. These rules also consist of methods or instructions for use that allow the system to operate and evolve in a reverse mode.

Thus, in fractal systems or architectures, and because of their invariance properties, there are tree structures that limit the system complexity. This is above all a characteristic of finalized systems much more than self-organization. This feature allows great flexibility and adaptation, but it is not enough. It is therefore necessary to add autonomy or self-management at each level.

Similarly, a dissipative structure cannot be hierarchical. However, in the case of the fractals of interest to us, they are not self-organized but result from an external force with a long range (general organizational laws) that meets local resistance (context and local constraints). This fragments and organizes them in such a way that organized autonomy then occurs.

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