Theory or Chance?"How much variation should we leave to chance?" With this question in the early 1920s Walter Shewhart posed the essential dilemma for any business manager. His study of the damaging effects of natural variation upon the host system and its processes was the starting point for aiming at what he termed "satisfactory, adequate, dependable economic-quality".
His work was carried out in the first instance to improve the performance of electrical equipment destined for the early telephone exchanges being built by AT&T across America. The result was a theory of variation that enabled production line workers to monitor their work sufficiently to remove uneconomic waste and defective workmanship.
A theory is no more than a rule of mind that allows us to better ubderstand past events and predict future outcomes. It is a rule that is shared by many until it fails and has to be replaced by a better one. While countless successful incidents can confirm a theory it takes only one failure to render it useless.
Problem solving without theory - a body of time tested knowledge - is not possible, other than by lucky and unrepeatable chance. Information is not knowledge; knowledge comes from theory since experience teaches us nothing without the the help of theory. Without theory we can only copy and guess.
While Shewhart was the first to provide managers, in 1926, with a powerful and practical theoretical tool (a charting method to help spot early signs of variation induced instability in systems, known as statistical process control or SPC, other major theoretical contributions to the world of organisational science and business management have been provided by such practitioners as ; Kurt Gödel and his Incompleteness Theorem (1931); Ludwig von Bertalanffy and his individual growth model (1934); Ross Ashby with his Law of Requisite Variety (1956); Norbert Weiner (1948) and Stafford Beer (1959) regarding a theory of cybernetics; Peter Checkland with his soft-systems methodology (1981) and Humberto Maturana with his theory of autopoesis* (1991).
All these 'predictive mechanisms' have helped to advances various areas of socio-technical economic activity. Used in varying combinations they have helped business practitioners around the world bring about improvements and elegant simplification to the ever more complicated arrangements of global business in a natural way that was long ago recognised by the perceptive American jurist Oliver Wendell Holmes, Jr (1841-1935) who vividly expressed his conviction thus: “I would not give a fig for the simplicity this side of complexity, but I would give my life for the simplicity on the other side of complexity.”
* autopoesis = to bring forth from within