The simplicity – complexity response paradox: Measuring organizational responses as repertoires of action patterns, degree of routinization, and enacted complexity
Many researchers refer to Ashby’s (1991) law of requisite variety to describe how organizations should adapt to organizational complexity, while others have the opposite suggestion; organizations should respond to environmental complexity by using a few simple rules. We call this the simplicity-complexity paradox, and propose that the classic discussion about the alignment between organizational response patterns and its environmental inputs can be empirically investigated by measuring the characteristics of organizations’ patterning of actions. We use a pattern-recognition approach founded on sequence analysis to operationalize key characteristics of organizational routines such as repertoire of action patterns, degree of routinization, and enacted complexity, and lay the foundation to empirically explore the simplicity-complexity paradox. The proposed measures quantify the behavioral data of organizations and make it possible to explore how organizations response to varying environmental inputs by studying the organization’s patterning of actions. We use the proposed measures in an empirical setting of invoice processing and show how the simplicity-complexity paradox can be resolved.