Max Boisot quotes
To summarize, the production of information and its use in transactions both incur costs and are thus subject to economizing. In the 1970s, there occurred a revival of interest among economists in the economics of transaction, and Oliver Williamson in particular, building on the earlier work of Ronald Coase and John Commons, has explored the different institutional arrangements that govern transactional choices.
Max Boisot
Knowledge management often generates theories that are too general or abstract to be easily testable. In some cases, simulation modeling can help. [WE have developed] an agent-based simulation model derived from a conceptual framework, the Information Space or I-Space and use it to explore the differences between a neoclassical and a Schumpeterian information environment.
Max Boisot
It makes sense to describe a core competence as a complex adaptive system, located in the lower regions of the I-Space between an ordered regime in which knowledge assets get frozen into technologies and a chaotic regime in which the stability necessary for effective organizational coordination and integration remains absent. Core competences, then, have their being in a region of the I-Space sandwiched between an excess of usable structure and a total lack of it. We hypothesize that the possession of a core competence is one measure of a firm's ability to deal with complexity.
Max Boisot
We shall also concern ourselves with the institutional order built up from transactions, but our focus will be less narrowly economic than the one adopted by Williamson. Like him, we shall argue that institutional structures aim partly at achieving transactional efficiencies and that where such efficiencies are effectively achieved they act somewhat like a magnetic field – a mathematician would call them ‘attractors' – drawing the uncommitted transaction into a given institutional orbit. Yet in contrast to Williamson's, our concept of transactions is underpinned by an explicit rather than an implicit theory of information production and exchange which yields a different way of classifying them as well as a distinctive approach to their governance. We find ourselves in consequence in the realm of political economy rather than of economics tout court.
Max Boisot
At the level of firms, therefore, only those whose cultural repertoire gives them transactional capacity throughout the I-Space can summon and adequate learning response to any emerging gaps between technology and culture. Those operating from too narrow a cultural base in the space, however, must of necessity lose control of the SLC unless they can complement their limited cultural repertoire through carefully selected interfirm and intercultural collaborations – i. e. through an externalization of transactions that link them with agents located elsewhere in the space. However, they will then confront the same problems of integration that more culturally diverse firms encounter inside their organization when trying to coordinate the activities of different functions or businesses. There is no cheap grace.
Max Boisot
