Complex adaptive systems
Power& tradition holding back progress Contents Overcome reactionaries

The nature of complex adaptive systems

Summary
This presentation introduces complex adaptive systems (CAS) looking at their components, structure and properties. 
Introduction
Complex adaptive systems (CAS) are all around us.  Being able to define CAS and differentiate them from simple and chaotic systems provides a first logical step to coping with complexity and understanding the world and ourselves


- next page -> (1 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
rhlcontents

<- previous page - - next page -> (2 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Emergence, adaptation and complexity 
The US sub-prime housing bubble and crash(p.24), the rapidly increasing cost of US health care(p.33), and the development of coral atolls are each good examples of effects of a complex adaptive system (CAS(p.5)).  In each case the system had many participants(p.12) interacting and responding to each other.  The participants in each system:
  • Adapt to their situation in complex ways, using a multiplicity of strategies and actions based on capabilities they were born with, and techniques they have learned,
    • The actions of each participant is interdependent
    • Changing one aspect of the system will alter other parts. 
    • Correctly predicting the result requires an accurate model(p.14) of the changes that will occur in each of the effected participants
  • Striving to capture resources: credit(p.25), effective treatments(p.34), or light, food and shelter, so they can
  • Continue with their lives and raise offspring
  • Each of the participants in the housing(p.27) and health care(p.36) networks is an aggregate of components which also respond to their local situation based on a recipe(p.28) of action
  • Each participant uses one or more recipe style plans(p.28) to define their potential actions
  • The participants, and their building blocks, repeatedly adopt and respond to strategies e.g. in housing(p.29) and health care(p.38) including: flexibility(p.20), centralization(p.20), prophylaxis(p.20), infrastructure amplifier(p.21), evolved amplifier(p.21), platform(p.21), and disruption(p.21)


<- previous page - - next page -> (3 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Emergent layers - phenomena -> physical -> chemical -> adaptive epiphenomena
  • Low level phenomena underlie the world: strings, quarks etc.
  • Physical and chemical effects result from the interactions of these low level physical phenomena
  • Simple predictive laws emerge from the characteristics of the physical phenomena observed within a bounded environment
    • Atoms, molecules, electrons obey Bohr's predictive laws as long as the phase is bounded by everyday scales of measurement
  • Bohr atoms, molecules, electrons are epiphenomena
  • Epiphenomena emerge as conceptual theories that predict the outcomes of interactions of real phenomena operating on a platform such as our world
    • Have re-combinable building blocks
    • Aggregate 
    • They are [in]directly active
  • Adaptive [epi]phenomena, also emerge from the interactions of low level phenomena, but they include


<- previous page - - next page -> (4 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Complex adaptive systems
  • Complex system:
    • Constrained by emergence(p.4)
    • Obeys a small set of rules
    • Represents environmental state
    • State variables interdependent based on the nature of the links between the state variables
    • Hurricane: component air and water molecules transiently present; It obeys physical laws; energy within hurricane can interact with (reflect) external environment
  • Complex adaptive system (CAS):
    • Uses captured energy to operate on plans and strategies
    • Executed by emergent(p.4) schematic agents(p.12)
  • CAS appear chaotic unless viewed with a representative model
  • Agents adapt to other local agents



<- previous page - - next page -> (5 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Signals and sensors
  • CAS(p.5) interact with their environment via sensors detecting signals, and emergent(p.4) agents(p.12) (1) performing actionsstructurally enhanced state agent array
  • Signals are phenomena(p.4) generated by the action of agents
  • A sensor's state will change when it interacts with an environmental phenomena such as a signal
  • As long as a sensor has differential state depending on what phenomena it is experiencing, evolutionary selection(p.17) can drive the emergence of advantageous associations
    • Evolution can capture beneficial strategies within the schematic plan(p.11)
    • An agent can associate each alternative state with a separate strategy
  • Signals can be multi-modal and require very rapid processing
    • Front-end processing sensors, such as eyes (2) and ears (3), which include structurally enhanced state(p.7), and massive parallelism emerges(p.4)
    • Networked associations can then represent the environmental situation (4), responses (5) and their valuations



<- previous page - - next page -> (6 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Structurally enhanced state
  • Emergent(p.4) agents(p.12) can only respond to signals(p.6) if they are able to represent them as state changes
  • When the signals are complex (view of animal walking in a wood), and multi-modal (sound and light), or occur very rapidly (falling object) it may be necessary to prophylactically setup a structure to represent the alternative states
  • The occurrence of a complex modal signal can then be represented by a change to the structure
  • The mechanism is very flexible
    • Structural linkages between agents can represent multi-modal signals
    • Pre-deployment of agents can support detection of rapidly changing signals
  • The structural state representation must be schematically(p.11) defined and modeled(p.14) by schematic agents


<- previous page - - next page -> (7 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Flows: control and partitioning
  • Objects accelerated by a force, channeled by phenomena(p.4) in their path create persistent emergent(p.4) patterns
  • CAS(p.5) can transform stored energy into forces that
    • Channel resource objects into flows
    • Partition flows
  • Network(p.9) of CAS agents(p.12) gather, channel flows of resources 
    • Resources transformed by agents into intermediate/end products
  • Energy consuming transportation agents can be integrated with agents monitoring(p.6) and controlling the flow
  • Buildup of intermediate products detected/used to inhibit early stage transport and operations
  • CAS agents provide an adaptive, emergent mechanism to control and partition flows


<- previous page - - next page -> (8 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Network effects
Network effects sustain improved efficiency of flows and control(p.8) between connected agents(p.12)
  • Examples of network effects include:
    • Water molecules hydrogen bonding to one another to form liquid water. 
    • Routers linked together enabling the operation of the Internet
    • Web pages linked together by HTTP and the Internet enabling operation of the World-Wide-Web.  
  • Network effects include:
    • Positive returns of hub connections
      • Increasing benefits for each element connected to a hub.  
      • Sexual selection(p.18) amplification of flows of genes and memes
    • Transition from chaos to order - as the number of elements connected increases the likelihood of most elements being connected increases asymmetrically, enabling flows and control(p.8)
    • Well-connected network is robust to node failures
    • Infrastructure amplification(p.21) improves flows, and enables control


<- previous page - - next page -> (9 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Network effects (continued)
  • Network effects can emerge as agents(p.12) connect to one another
  • Topology introduces constraints and other properties to the network 
    • One additional link can significantly effect the system
  • Closely connected agents can cluster 
    • Outside the cluster weak links/highly connected hub agents connect other parts of the network
  • In agent networks the resources transported through the network include
  • System dependent on continued resource flows


<- previous page - - next page -> (10 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Introduction to schematic structures
Schematic structures are constructed from simple building blocks, such as nucleic acids or the letters of the alphabet.  These blocks are able to link together into groups, lists and networks, and directly or indirectly associate with agents(p.12)

  • Deployed based on a fundamental building blocks (1) which can: schematic string
    • Provide brick for agents, including genetic operators(p.15), to build structures
    • Represent a data value and be
    • Replicated and
    • Linked into lists (2)
    • Integrate descriptors, and addressable labels
      • Descriptors can be interpreted broadly by agents as for example valuations or epi-genetic control signals(p.6)
    • Associatively network
  • Any schematic sequence of basic elements can be interpreted by an agent as a signal (3) to perform a specific act
    • Agents position on the schematic structure represents a state and so the local sequence can be a signal
    • Becomes an association (4) between signalled event and the agent's action
    • Actions can include modeling(p.14) of a situation


<- previous page - - next page -> (11 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Agents: schematic aggregates generating action
Agents are emergent(p.4) aggregations of catalysts.  The aggregations are formed schematically(p.11) associating programmed control of catalytic actions with different goals and events
  • Agents - association between goals and actions.  They
  • Perform actions (1) by focusing fundamental physical forces, marshaled as accessible stored energylogical agent
  • Respond to
    • Signals(p.6) from their environment (2)
    • Other agents
    • Their own state (3)
    • From this aggregation goals emerge
  • Constructed from active structures formed from re-combinable building blocks 
  • Utilize a schematic plan(p.11) (4) to indirectly associate the signals with actions
  • Invoked under operon control
  • Form emergently(p.4)


<- previous page - - next page -> (12 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Emergent(p.4) agents process environmental signals(p.6) and their instance of the schematic plan to select actions which they perform
Agents can interpret the schematic structures as they please, but acted on by evolutionary selection(p.17) beneficial associations of signals and actions transform into strategic attributes of the system
  • A labeled element, operon, with associated actions corresponds to a goal
  • Specific goals can be associated with multiple, alternative actions
  • Individual agents can be deployed with a full complement of operons, but different, allelic, sets of associated actions
  • Filtering of labels and other tags provides a flexible control of flows(p.8)
    • Agents can filter, and integrate the flows of schematic elements to perform genetic operations(p.15)
  • Genetic operations provide the basis for learning, by correlating success in replication of schematic structures and the retention of valuable sequences with positive agent actions
    • Requires that agents actions are based on schematic signals
  • Total set of different germ-line schematic structures shared in genetic operations corresponds to the evolving state
  • Ability to replicate schematic structures allows for somatic copies to be augmented with highly specific state descriptors, while germ-line copies are left pristine
  • Multi-cellular agents are able to deploy different states in individual somatic cells


<- previous page - - next page -> (13 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Models provide agents with a schematic view of the world
  • Emergent(p.4) agents(p.12) must be able to differentiate good strategies from bad.  Models assist them with making such decisions
  • They are hypothesis that use success or failure as an indicator of legitimacy
  • Correlation of model and schematic(p.11) agent action allows evolutionary selection to 'rate' models in particular niche situations
  • Agents can extend the evolved rating mechanism by applying a Shewhart cycle(p.19)


<- previous page - - next page -> (14 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Modifications to the germ-line structures are performed by genetic operators 
  • Emergent(p.4) agents(p.12) can include genetic operators which allow reproduction to formally transform the current structures for the next generation
  • Genetic operators can equivalently be deployed via a discrete process called a genetic algorithm
  • Operations include: mutation, crossover, inversion, translocation, deletion, dominance modification


<- previous page - - next page -> (15 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Phenotypic alignment:
Emergent(p.4) agents(p.12) competing in adjacent environmental niches gain fitness from synergistic network effects(p.9) 
Selection pressure re-enforces the process of alignment  
  • Mother's genes can generate agents which support their developing offspring.
    • Support will apply the mother's phenotypic strategies to the development of the offspring, which may be different to the phenotypic action of the offspring's agents 
    • Mother's genotype has aligned with the offspring's phenotype.  More generally,
  • Male genes can express phenotypically signals deployed with their sperm to inhibit a female from accepting further sperm (from competing males)
    • Induces an arms race(p.21) between males & females
  • Multiple genes may contribute to a phenotypic effect 
    • Alleles may compete for effect
    • Genes can be in separate bodies (males & females competing in the arms race above) 
  • The extended effect may be present whenever one organism appears to be manipulating another
Dawkins central theorem "An animal's behavior tends to maximize the survival of the genes 'for' that behavior, whether or not those genes happen to be in the body of the particular animal performing it.  "


<- previous page - - next page -> (16 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Natural selection: collecting situation specific beneficial recipes within an adaptive agent
Evolution: interaction of selection of agents(p.12), variation of schemata, heredity

Structure of schematic plan(p.11):
Schematic specification/control of operational cascades:
  • Schematically represented Darwinian pre-adaptations can recur generation after generation
  • Pre-adaptations become niche specific selective advantages
    • Association between niche and beneficial phenotypic effect is formed
    • Schematic amplifier can emerge


<- previous page - - next page -> (17 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Sexual selection:
 CAS(p.5) agents(p.12) reproduce using genetic operators(p.15) to
  • Integrate the schematic plans(p.11) of each parent
  • Indirectly select genetic structures
  • Particular phenotypic effects
    • Generation of a trait in male offspring and
    • Selection of that trait in female offspring
  • Responsible genes collocated in genomes of both expressive males and females (polygenes)


<- previous page - - next page -> (18 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Shewhart cycles: Walter Shewhart advocated the use of iterative cycles of: Planning, Doing, Checking and Acting to fix issues (PDCA)
  PDCA cycle emerges(p.4) naturally in complex adaptive systems
  • Examples include the cell cycle, cell death programme, cell growth programme, Just-In-Time manufacturing
  • Plans in an adaptive system are schematic structures(p.11)
    • Associated with current environmental state indirectly through modeling(p.14)
    • Models generate predictions of results of performing each strategy
  • Performing, or 'do'ing, a highly valued strategy will result in some change of state of the agent(p.12) and its environment
  • Agent can compare (check) the result against the models prediction
    • Human agents evolved strategies often avoid checking(p.23) so a required process supports the formation of the habit
  • If reality differs from the prediction the valuation of the strategy can be adjusted


<- previous page - - next page -> (19 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Strategies for success
Schematic aggregation(p.12) results in the emergence(p.4) of goals and strategies - clusters of actions which are beneficial when a particular situation recurs
  • Flexibility - requires that different generic situations can be recognized and responded to appropriately
    • Schematic retention of good strategies allows these to be deployed when the situation repeats
  • Personality aligns around focus on the group and concreteness - Individualist Artisans and group oriented Guardians are interested in concrete activities
    • Individualist Rationals and group oriented Idealists are more conceptual
  • Guardian morality - punishment by the whole group, enforced by the Guardians, on those who cheat on their commitments to the group
  • Centralization - when agents migrate to the most connected regions of the network their influence increases
  • Prophylaxis - key nodes in a network can be supported by the close attention of multiple cooperating agents
    • Before they come under pressure
    • Often deterring competitors from moving to those nodes


<- previous page - - next page -> (20 of 21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Strategies for success (continued)
  • Infrastructure amplification - uses structures that reduce startup costs of operations to catalyze flows.  Enzymes, banks and roads are examples
  • Evolved amplification - deploying rules and inducing a collection of agents to act
    • So that the inducer gain significantly
    • Even as the induced agents benefit a little
  • Platform - focusing agents on a network hub with
  • Structurally enhanced state - Compound signals, can be represented, and processed by cooperating networks of agents
    • General data structures typically limit what a single agent may represent
    • Representation is defined by the schematically controlled deployment of agents in the network under evolved pressure
  • Bundling - Shared schemata allow strategies to be deployed cooperatively, and differentially, so that specialized agents can operate as a super organism
  • Disruption - with limited energy and constraining models hub network agents can be induced to prioritize strategies
    • Guarantee their nodes collapse responding to newly joined low cost nodes


<- previous page - (21)
 

Power& tradition holding back progress Contents Overcome reactionaries
Backup slides follow

- next page -> (backup 22 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
The planning problem (continued - checking):
  • Evaluating the success of actions takes time and failure creates doubts and undermines value
    • Success is uncertain
    • Future is unpredictable
    • Intermediate actions may be necessary but appear relatively ineffective
    • Models(p.14) must become aware of the situation specific valuable associations
    • So many agents assume success
      • Evolved strategy - so it has advantages to the selfish genes
      • Gaining time and possibly status 
      • Looking for scapegoats when a failure is detected
  • Fitness functions provide immediate feedback and allow separation of the problem into two well-defined phases used by genetic algorithms(p.15):
    1. Operation of agents(p.12) to determine aggregate fitness based on the fitness functions
    2. Generation of a next generation of schematic structures(p.11) based on current populations aggregate fitness
  • More typically the persistence of particular agents to survive long enough to reproduce and support its offspring to maturity is not described effectively with simple fitness functions
    • They must explore their proximate environment creatively to
      • Identify new niches
      • Discover/develop additional sensors(p.6), models and actions
      • Conserve these creative capabilities
      • Capture resources and use them to enable eventual reproduction



<- previous page - - next page -> (backup 23 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
Simplified US subprime residential mortgage bubble
  • Strategic alignment(p.16) ensured value chain participants and investors huge returns on subprime loan originated debt 
  • Non-participants relative losers
  • Low FED short term interest rates increased profit/size of flows 
  • Non-participants drawn into cycle
  • Bubble developed, system unstable  Increases in interest rates would dry up the flows(p.8)
  • Finite pool of legitimate borrowers
    • Less robust borrowers were included to keep the pipeline full
  • Poor performance obvious
  • Bubble burst




<- previous page - - next page -> (backup 24 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
Simplified US subprime residential mortgage value delivery system (VDS)

A network(p.9) of agents(p.12) moves the flows(p.8) of loans, assets and payments through the US residential mortgage network to provide borrowers with credit
  • Early mortgage recipient - owner of increasingly valuable home but otherwise poor credit
    • Subprime mortgage was relatively low cost form of credit
  • Realtors/loan brokers linked home owners to mortgage originators, for a commission
  • Subprime mortgage originators initially specialists who secured high interest payment on a loan with
    • assessments of the recipients equity stake in the house
    • expertise in repossession
  • Assessments of house value made by independent appraisers. 
  • Originators financed the mortgages with Wall Street banks'(p.21) warehouse loans




<- previous page - - next page -> (backup 25 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
Simplified US subprime residential mortgage VDS (continued)
  • Wall Street banks obtained capital by selling opaque securitized packages(p.21) containing pools of subprime and other lower risk mortgages, from different US housing markets 
    • Different parts of these packages were rated for risk by rating agencies
    • Sustained stream of high interest payments was attractive to Wall Street lenders (Prudential) as long as
      • Mortgage recipient did not refinance when
      • Prudential then left to make the interest payments
  • The rating agencies developed models of the risk associated with the packages of mortgages
    • Based on these assessments the different parts of the securities were labeled with a rating
  • Lowly rated parts of the mortgage backed securities were packaged into synthetic securities which further pooled the mortgages
    • Ratings of synthetic securities was initially higher than the ratings of the component securities
  • Legislators allowed highly rated mortgage backed securities to be owned by insurance and pension funds(p.21)
    • High interest rates and low retained capital requirement relative to the risk rating made these very attractive to own




<- previous page - - next page -> (backup 26 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) aggregates(p.12) within the US subprime VDS
  • loan originators aggregates of specialized staff: sales, compliance, access to capital
  • Wall Street banks aggregates of: traders, sales teams, research analysts, risk managers, compliance officers, lawyers, quantitative analysts
  • Ratings agencies aggregates of: analysts
  • Legislature aggregate of: elected representatives and senators, their staff, lawyers, civil servants




<- previous page - - next page -> (backup 27 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) recipes(p.11) used by agents(p.12) within the US subprime VDS
  • In each case managers respond to market opportunities by defining teams and allocating them with goals
    • Corresponds to the association of signals(p.6) with goals
    • Consequent indirect deployment of operons (labeled entry points) controlling activation of agents
  • Specialist skills of each team member/processes they follow correspond to collection of schematic recipes, which they select the most appropriate to perform to achieve the goals
  • Models, also schematic recipes, used to select most appropriate action plan
  • Predictions of the models, are compared(p.19) with the action plans results
    • Adjusted to better reflect the models match with the current local environment




<- previous page - - next page -> (backup 28 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) strategies used by US subprime VDS
  • Sexual selection(p.18) was utilized by Wall Street banks, legislators and regulators
    • Wall Street banks opaquely repackaged high-risk parts of mortgage backed securities - new packages rating of risk would be higher, according to the models used by ratings agencies
    • Institutions constrained by regulations and signalled(p.6) by regulators to buy highly rated investments
      • Found the opaque packages ratings attractive
    • Wall Street banks, aware of the contents of the packages, shorted the investments
  • Wall Street bundled(p.21) together zero interest warehouse loans with agreements to securitize the originators mortgage loans
    • As profits rose on securitizing loans some investment banks transferred risk attached to 'B' loans to themselves after a period of 60 to 90 days




<- previous page - - next page -> (backup 29 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) strategies used by US subprime VDS (continued)
  • Evolved amplifiers(p.21):
    • Loan brokers instantiated evolved amplifier
      • Encouraging borrowers to refinance, and originators to provide loans. 
      • While loan originators could be impacted by stream of interest they would have to pay, brokers were not constrained
    • Wall Street's development of synthetic securities that spread impact of interest payments supported the amplifier
    • Loan originators relaxed requirements placed on borrowers expanding the potential number of transactions
    • Investment banks creating real estate investment trust (REIT) captured clients who became dependent on further transactions, whatever the business climate
    • In line with lobbying from loan originators (also significant campaign donors) legislators distributed regulation of subprime lending
      • Federal bank regulator offered federal control with limited constraints on lending
      • US comptroller collected fees for any banks that switched to limited federal regulation from state regulation




<- previous page - - next page -> (backup 30 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) strategies used by US subprime VDS (continued)
  • Infrastructure amplifiers(p.21):
    • The Wall Street banks removing loans from the originators books, securitizing them as collateralized mortgage obligations and selling the securities in the financial markets
    • The Federal Reserve kept short term interest rates low.  It minimized government regulation of
      • Wall Street's derivative operations
      • Wall Street's integration of loan originators
      • hedge fund activities
    • Automated loan assessment tools speeded up the qualification process
    • With the creation of Fannie Mae and Freddie Mac politicians brought residential housing to the center of the political economy(p.20)
      • Reagan, Clinton and George W. Bush each leveraged home sales as a generator of demand
      • The government agency chartered Resolution Trust Corporation was chartered by Congress to liquidate $300 billion of failed S&L assets




<- previous page - - next page -> (backup 31 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) strategies used by US subprime VDS (continued)



<- previous page - - next page -> (backup 32 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
The increasing cost of US health care
  • Success in treating formerly lethal diseases (diabetes, congestive heart failure, asthma, depression and coronary thrombosis) resulted in huge increase in chronic care costs
  • Centrally coordinated pricing of medical treatments/limited inhibitors on over treating patients has increased the cost of treatment
  • Inefficiency/low quality of treatment processes increases
    • Costs of rework, and
    • Dependence on intuitive expertise, which 
    • Sustains high cost centralized regimens
  • Current participants in health care control who is qualified to treat, who gets access to treatment, and what treatments get paid for
  • Legislatures include participants from the health care process, and respond preferentially to lobbying from the health care industry
  • Prescription drugs are tested for detrimental effects on a broad sample of the target population
    • High cost of the trials and low acceptance rate of the drugs encourages huge markups on marketable drugs
  • Evolved response of humans to problems rates newly experienced diseases, as more significant than chronic ailments
    • Time consuming treatment regimens are typically abandoned once other pressing issues appear or current symptoms reduce in intensity
    • Unconsumed treatments are then stockpiled




<- previous page - - next page -> (backup 33 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
Simplified US health care value delivery system (VDS)

A network(p.9) of agents(p.12) moves the flows(p.8) of expertise, drugs, equipment, treatments and payments through the US health care network to enable treatment of patients
  • Physician's practices and hospitals are independent profit seeking businesses
  • Physician's practices offer to treat any problem for their patients
  • Primary care physicians:
    • Patient's gatekeeper to the health care system
    • Monitor of chronic diseases
    • Perform the ongoing assessment of wellness
    • Manage rules based diagnosis and treatment
    • First line of assessment of intuitive medicine
  • Hospitals offer to treat any problem for their patients
  • Hospitals are typically an aggregate of different types of business:
    • Job shops - patients problems are looked on as unique, and centralized experts and resources are applied intuitively to develop an individual treatment plan
    • Chains - patients problems are recognized as being of a specific type treatable with standardized iterative processes




<- previous page - - next page -> (backup 34 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
Simplified US health care VDS (continued)
  • Financed by reimbursement from employers, insurance companies and the US Government
  • Network is constrained by regulation
    • Access to practice medicine is regulated by physician's guild.  Maintains control because reimbursement is conditional on the practitioner having a guild issued license
    • Patient access to hospitals is controlled through contracts between hospitals and insurers
      • Large general hospitals obtain exclusive contracts since they match the overall coverage required by insurers, limiting competition by specialists
    • Treatment is constrained by reimbursement (centrally planned pricing)
      • Medicare contracts drive alignment with insurers and suppliers over prices and preferred treatment options
  • The US population has accepted a right to any current treatment
  • Doctors are incented to provide as many profitable services as possible
  • For major employers reimbursement/associated tax policies provide incentives for employees to stay with the organization
  • Schools of medicine and nursing, research and maintain formal medical models, actions and processes which are provided to trainee doctors and nurses
  • Universities research and maintain the formal scientific models, actions and processes which are provided to the trainee pre-medical students




<- previous page - - next page -> (backup 35 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) aggregates(p.12) within the US health care VDS
  • Patients: with similar symptoms
  • Physician practices: doctors, nurses, clerical assistants
  • Hospitals: doctors, nurses, technicians, management, maintenance, clerical assistants, managers
  • Pharmaceutical businesses: doctors, scientists, chemists, biochemists, pharmacists, managers, marketing, sales
  • Medical device businesses: doctors, engineers, managers, marketing, sales
  • Regulators: doctors, scientists, lawyers, civil servants
  • Legislature: elected representatives and senators, their staff, lawyers and civil servants




<- previous page - - next page -> (backup 36 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) recipes(p.11) used by agents(p.12) within the US health care VDS
  • In each case managers respond to market opportunities by defining teams and allocating them with goals
    • Corresponds to the association of signals(p.6) with goals
    • Consequent indirect deployment of operons (labeled entry points) controlling activation of agents
  • Specialist skills of each team member/processes they follow correspond to collection of schematic recipes, which they select the most appropriate to perform to achieve the goals
  • Models, also schematic recipes, used to select most appropriate action plan
  • Predictions of the models, are compared(p.19) with the action plans results
    • Adjusted to better reflect the models match with the current local environment




<- previous page - - next page -> (backup 37 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
CAS(p.5) strategies used by US health care VDS
  • Bundling(p.21) allows Hospitals to cross subsidize low margin aspects of their business with high profit parts
  • Phenotypic alignment encourages Regulators to restrict entry of focused competitors from cherry picking the high profit parts of the hospital business
  • Evolutionary amplifier(p.21) subsidizes corporations who offer health plans as part of employees remunerations
    • The employees are incented to stay with the corporation
      • Obtain some assurance of affordable care
    • The employers retain and protect their valued staff
    • The government encourages citizens to work for corporations
      • Legislators gain support from health care business leaders
    • Amplifier disconnects treatment from cost, encouraging overtreatment
  • Hospitals use centralization(p.20) of expertise and capital resources, and infrastructure amplification(p.21)
  • Scientific/medical research and training establishments provide genetic operators(p.15) which capture, deploy and activate best practices and innovations




<- previous page - - next page -> (backup 38 of 39)
 

Power& tradition holding back progress Contents Overcome reactionaries
Complex adaptive systems are all around us

Being able to define CAS and differentiate them from simple and chaotic systems provides a first logical step to
  • Coping with complexity
  • Understanding the world and ourselves

 

<- previous page - (backup 39)