What are organizations for? LO6138

Wed, 20 Mar 1996 12:50:41 -0500

Replying to LO6115 --

Dear If Price:

You describe this systemic structure...

> - employees invest their savings in mutual funds, expecting maximum
> - mutual funds grow in size as huge amounts of money are shifted to equity
mutual funds
> - mutual fund managers yield greater influence allowing them to
makedemands of company CEOs and boards to maximize profit
> - company CEOs layoff workers to maximize profit>

add -workers invest layoff payoffs in mutual fund for security- and the

positive feedback is complete. We really do come >full circle>, which I

guess is what you wanted me to discover.

and then ask...

Now where's the limit to growth? There must be one lurking out there and
more to the point how to we break out of the pattern?

It is possible that you do not have a reinforcing structure here in the
first place. Workers can invest layoff profits only once, and it's not
clear that any but the most employable would do this. It seems more
likely that most would use layoff money to pay the rent.

It seems to me that you've described most of a balancing structure. As
layoffs increase, there are fewer employees to invest in mutual funds,
leading to a diminution of the absolute dollars in those funds relative to
total wealth. You can trace the consequences of this through the steps
above yourself, but the addition of this link makes this a basic balancing
structure where we would predict that over time, all else being equal, all
the factors would grow and diminish cyclically.



Learning-org -- An Internet Dialog on Learning Organizations For info: <rkarash@karash.com> -or- <http://world.std.com/~lo/>