AI and organizational decision making

Organizations, according to social systems theory, consist of decision communication. Organizations do not consist of people or decision-makers but communication–in the case, decision communication. While human beings, at least for now, are a necessary precondition of organizations, the organizations themselves, as social systems, consist only of decision communication. The “decision-makers” are a function of attribution, and, as such, they belong to the organization’s environment. This view allows us to see AI technologies, such as IBM’s Watson, as decision-makers on the same level as human decision-makers. If human beings and Watson both exist in the environment of an organization, systems theory need not distinguish between the two. Also, it doesn’t matter if an IA technology or a human being makes a decision because all that matters is the communication of decision.

A common criticism of social systems theory is that it does not take individual human beings seriously. But, arguably, the only way to take the individual seriously is to exclude the individual from social systems. This may also be the only way to treat social systems seriously–that is, as more than the sum of human beings, human actions, or individual motives. Far from devaluing human beings, people gain a sense of freedom by not being considered parts of an organization. A machine component has no real purpose outside of a machine. But people are not parts of a machine, and organizations are not machines; they are social systems that reproduce themselves from moment to moment through decision communication. If a person were actually a part of an organization she (like an individual nut or bolt) would be useless once she exits the organization or at least until she joins a new organization.            

People, as well as, in most cases, various forms of material infrastructure, are needed to keep an organization functioning, but the individual people and the elements of the infrastructure come and go while the organization, if it remains an organization, persists. The roads, bridges, fiber optic cables, electrical grids, airports, etc., that exist outside an office building (and the office building itself) may well be necessary preconditions for the continued functioning of a particular organization, but those pieces of material infrastructure are not parts of the organization for the simple reason that organizations do not consist of parts.

Furthermore, most organizations include higher paid “decision-makers” and those who perform tasks but do not make actual organizational decisions. Adopting the traditional view, the decision-makers are more important than the “non-decision-makers.” But if neither group actually belongs to the organization—both remain in the system’s environment—our view changes. The people in the IT department might not make so-called organizational decisions, but they are probably a necessary precondition for the organization’s decision communication. The board of directors, CEO, CFO, or any other “decision-makers” are also “mere” preconditions for decisions. The decision-makers do not constitute the organization any more than the people who clean the offices at night.


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