According to Beer, there are three main elements which are involved with influencing any self-organising system in the Viable System Model:
Operations - elements which do things.
Management - elements which control operations.
Environment - the surroundings within which the other elements function.
Summary of Beer's Principles of Organisation
a) Equilibrium of Varieties (Principle 1):
Managerial, operational, and environmental complexities should naturally align to achieve balance, minimising disruption to individuals and costs while ensuring efficiency and preserving autonomy.
b) Efficient Information Flow/Communication (Principle 2):
Communication channels must handle information faster than the rate of variety generation, maintaining stability and enabling the organisation to adapt dynamically to changes.
c) Boundary Transduction (Principle 3):
Information crossing organisational boundaries must be translated effectively to ensure clarity and mutual understanding across different levels and functions.
d) Continuous Operation (Principle 4):
The system must operate cyclically and without delay, continuously responding to environmental changes to maintain synchrony and organisational stability.
While most projects/contracts often structure reports around discrete time periods (e.g., quarters, months or weeks), real-world operations do not adhere to such rigid timelines. To effectively respond to environmental changes and fluctuations in variety, managerial processes must function continuously.
In construction project management, the concept of a self-organising system with the three elements—operations, management, and environment—can be explained as follows:
1. Operations: The Elements That Do Things
In a construction project, operations represent the core activities and resources directly involved in delivering the project outcomes. These include:
Construction teams: Labourers, subcontractors, and specialists performing tasks such as excavation, foundation laying, and structural work.
Materials and equipment: Physical resources used in construction.
Processes: Methods and techniques applied, like concreting or steel erection.
Operations form the functional backbone of the project, ensuring physical progress and completion of deliverables.
2. Management: The Elements That Control Operations
Management provides oversight, coordination, and direction to ensure the efficiency and effectiveness of operations. This includes:
Project managers and site supervisors: Responsible for planning, scheduling, and monitoring work progress.
Cost and quality management: Ensuring adherence to budgets, timelines, and specifications.
Decision-making processes: Identifying risks, resolving conflicts, and managing resource allocation.
Management ensures that operations align with project goals, overcoming challenges and maintaining control.
3. Environment: The Surroundings Within Which Operations and Management Function
The environment encompasses external and internal factors that influence operations and management, such as:
External factors: Regulatory requirements, market conditions, weather, and stakeholder expectations (clients, architects, engineers).
Internal factors: Organisational culture, communication systems, and project-specific constraints (scope, time, and cost).
The environment sets the context in which decisions are made and work is executed, requiring adaptability to changing conditions.
In a Self-Organising Construction Project System:
Operations respond to immediate tasks and deliverables.
Management integrates and aligns operations with project objectives.
Environment provides the constraints and opportunities influencing decision-making and execution.
This interplay ensures the system remains dynamic, flexible, and capable of self-organising to adapt to the complexities of construction projects.
Systems within the Viable System Model (VSM) and its relationship with Contract Manager:
Beer identified five subsystems within a single level of the VSM, each corresponding to specific organisational functions:
System 1 - Operations: Represents the core units or activities directly responsible for delivering the organisation's primary outputs or services.
System 2 - Coordination: Ensures harmony and conflict resolution between operational units, maintaining stability and efficient functioning.
System 3 - Control: Oversees resource allocation and operational performance, providing governance and feedback for operational units.
System 4 - Intelligence: Focuses on adapting to external environments by scanning for opportunities and threats, guiding long-term strategy.
System 5 - Policy: Represents the organisation’s overall identity and decision-making authority, maintaining balance between present operations and future planning.
These subsystems collectively mirror an organisation's structural components and ensure viability by facilitating coordination, control, adaptation, and strategic alignment. System 3 is effectively the link between the two meta-structures (1-2 and 4-5).
The Viable System Model (VSM) provides a useful framework for understanding the role of a contract manager in ensuring the effective functioning and viability of a project or organisation, particularly in the context of construction. Each subsystem of the VSM aligns closely with the contract manager's responsibilities, enabling them to maintain organisational stability and adaptability while managing contractual obligations. Here's how the VSM relates to the role:
1. System 1 – Operations (Execution of Work)
VSM Aspect: Core units or activities delivering the organisation’s outputs.
Contract Manager's Role:
Ensuring that all work performed complies with contractual terms, specifications, and standards.
Monitoring subcontractors and suppliers to ensure timely and quality delivery.
Aligning operational performance with the agreed scope of work.
Resolving disputes arising in day-to-day operations to prevent disruptions.
2. System 2 – Coordination (Maintaining Stability)
VSM Aspect: Mechanisms for coordinating operational units and resolving conflicts.
Contract Manager's Role:
Facilitating communication between stakeholders (clients, contractors, consultants).
Coordinating multiple contracts to prevent overlap or gaps in responsibilities.
Implementing systems to track progress, report issues, and manage changes effectively.
Maintaining harmony between operational teams to meet project timelines.
3. System 3 – Control (Governance and Resource Management)
VSM Aspect: Monitoring operations and managing resources effectively.
Contract Manager's Role:
Overseeing compliance with the contract's financial and legal terms.
Managing claims, variations, and extensions of time to ensure contractual integrity.
Providing regular performance reports to stakeholders.
Ensuring optimal allocation of resources within the contractual framework.
4. System 4 – Intelligence (Adaptation and Future Planning)
VSM Aspect: Scanning the environment for opportunities and threats, shaping strategy.
Contract Manager's Role:
Analysing market and regulatory changes to assess their impact on the contract.
Identifying risks and opportunities during the project lifecycle.
Advising on strategic adjustments to contracts to maintain alignment with organisational goals.
Preparing for and mitigating potential disputes or claims by anticipating challenges.
5. System 5 – Policy (Identity and Direction)
VSM Aspect: Establishing overarching policies and maintaining a balance between present and future needs.
Contract Manager's Role:
Defining and upholding contractual governance principles that reflect organisational priorities.
Balancing short-term operational needs with long-term contractual obligations.
Acting as a custodian of the contract, ensuring it aligns with organisational values and strategic goals.
Ensuring that decisions are consistent with the project’s priorities in terms of scope, cost, and time.
Key Takeaways
Viability of the System: The contract manager ensures that all components of the project (operations, coordination, control, adaptation, and policy) work together harmoniously within the boundaries of the contract.
Dynamic Adaptation: Like the VSM, the contract manager must maintain a balance between maintaining stability in current operations and adapting to environmental changes.
Integration Role: The contract manager acts as the central node connecting operations, management, and external factors, ensuring the system remains viable by addressing risks, opportunities, and stakeholder needs.
By leveraging the principles of the VSM, a contract manager ensures that the project system remains sustainable, resilient, and aligned with its objectives amidst the complexities of the construction environment.
Anthony Stafford Beer (1926-2002) was a British leadership theorist, best known for his work into Viable System Model (VSM) of operational interactions.
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