Cybernetic modeling of business systems

Business is a purposive cybernetic system. It needs to survive an evolving competitive environment, as also its evolving purposes. We take a qualitative approach to modeling of business enterprises as systems, as an initial sound step in understanding them, before embarking on empirical or mathematical quantitative studies. Systems theory includes two powerful models that identify canonical decompositions of system functions: the Viable Systems Model (VSM) of Stafford Beer and the Living System Model (LSM) of Miller. The VSM asserts the property of viability: the ability to assert independent existence and an identity despite change necessitated by survival, while the LSM asserts the capability to acquire and process materials from the environment to derive energy, and acquire and process information from the environment to respond to stimuli. These models incorporate the capability for evolution, but do not explicitly address the nature of evolution in purposeful systems. Our work proposes another canonical decomposition of systems into three subsystems: Body, Mind and Spirit. This is aimed at asserting the sufficiency of knowledge and mechanisms that allow business enterprises to function and evolve in changing environments.