The document discusses the evolution of market dynamics and organizational structures, highlighting the shift from industrial to post-industrial paradigms characterized by increasing complexity and adaptability needs. It emphasizes the necessity for organizations to realign their architecture and processes to meet the demands of dynamic markets while adhering to Conway's law, which states that organization design influences system design. Ultimately, it advocates for a focus on real needs rather than trends or habits in adapting to these changes.

1. Towards complex adaptive architectures
A journey from hypes and habits to real needs
Uwe Friedrichsen, codecentric AG, 2015

2. @ufried
Uwe Friedrichsen | uwe.friedrichsen@codecentric.de | http://slideshare.net/ufried | http://ufried.tumblr.com

3. Time for some storytelling …

4. Story #1
The story of markets

5. Formal part of
value creation
Solution:
machine
Dynamic part
of value
creation
Solution: man
sluggishness/low dynamic high dynamichigh dynamic
The historical course of market dynamics
and the recent rise of highly dynamic and complex markets
The dominance of high dynamics and complexity is neither good nor bad. It‘s a historical fact.
t1970/80 today
Age of
crafts manu-
facturing
Age of
tayloristic
industry
Age of
global
markets
1850/1900
Spacious markets,
little competition
Local markets,
high customi-
zation
Outperformers exercise
market pressure over
conventional companies
We call the graph shown here the “Taylor Bathtub”.
The “bathtub” curve
Source: BetaCodex Network Associates, “Organize for complexity”, BetaCodex Network White Paper 12 & 13

6. Formal part of
value creation
Solution:
machine
Dynamic part
of value
creation
Solution: man
sluggishness/low dynamic high dynamichigh dynamic
The historical course of market dynamics
and the recent rise of highly dynamic and complex markets
The dominance of high dynamics and complexity is neither good nor bad. It‘s a historical fact.
t1970/80 today
Age of
crafts manu-
facturing
Age of
tayloristic
industry
Age of
global
markets
1850/1900
Spacious markets,
little competition
Local markets,
high customi-
zation
Outperformers exercise
market pressure over
conventional companies
We call the graph shown here the “Taylor Bathtub”.
Pre-industrial era
Source: BetaCodex Network Associates, “Organize for complexity”, BetaCodex Network White Paper 12 & 13
Tailor-made
solutions
“Mastery
is key to success”

7. Formal part of
value creation
Solution:
machine
Dynamic part
of value
creation
Solution: man
sluggishness/low dynamic high dynamichigh dynamic
The historical course of market dynamics
and the recent rise of highly dynamic and complex markets
The dominance of high dynamics and complexity is neither good nor bad. It‘s a historical fact.
t1970/80 today
Age of
crafts manu-
facturing
Age of
tayloristic
industry
Age of
global
markets
1850/1900
Spacious markets,
little competition
Local markets,
high customi-
zation
Outperformers exercise
market pressure over
conventional companies
We call the graph shown here the “Taylor Bathtub”.
Industrial era
Source: BetaCodex Network Associates, “Organize for complexity”, BetaCodex Network White Paper 12 & 13
Cost-efficiently
scale production
“Get more done with less people
is key to success”

8. Formal part of
value creation
Solution:
machine
Dynamic part
of value
creation
Solution: man
sluggishness/low dynamic high dynamichigh dynamic
The historical course of market dynamics
and the recent rise of highly dynamic and complex markets
The dominance of high dynamics and complexity is neither good nor bad. It‘s a historical fact.
t1970/80 today
Age of
crafts manu-
facturing
Age of
tayloristic
industry
Age of
global
markets
1850/1900
Spacious markets,
little competition
Local markets,
high customi-
zation
Outperformers exercise
market pressure over
conventional companies
We call the graph shown here the “Taylor Bathtub”.
Post-industrial era
Source: BetaCodex Network Associates, “Organize for complexity”, BetaCodex Network White Paper 12 & 13
Continuously respond
to changing demands
“Continuous
customer communication
is key to success”

9. Industrial era
• Cost-efficiency
• Scalability
• Repeatability
• Stability
Drivers for organizations
Post-industrial era
• Cycle times
• Adaptability
• Flexibility
• Resilience

10. Story #2
The story of organizations

11. The predominant
industrial organization …

12. Market
Observe
Derive Goals & Create Plan
Execute
Execute
Command
& Control
Execute
Command
& Control
Execute
Command
& Control
Command
& Control
Tayloristic
Organization

13. Tayloristic Organization
Pros
• Cost-Efficient
• Easy to scale simple/complicated tasks
Cons
• Sluggish response to change drivers
• Very fragile with respect to complexity
à Great for wide and slow markets,
Bad for narrow and dynamic markets

14. A post-industrial organization
sometimes seen in the wild …

15. Market
Observe
Derive Goals & Constraints
Beta
Organization
Share Goals
& Constraints
Collaborating
autonomous
Teams
Inspect & Adapt
Inspect & Adapt
Inspect & Adapt
Inspect & Adapt

16. Beta Organization
Pros
• Responds well to change drivers
• Deals well with complexity
• Scales quite well
Cons
• Centralized definition of goals & constraints
à Modern leadership model for
narrow and dynamic markets

17. An ideal post-industrial organization
not yet seen in the wild …

18. Market
Complex Adaptive Organization
(Cybernetic Organization)
Continuously
communicate
Organization continuously adapting to market needs & demands

19. Cybernetic Organization
Pros
• Best response possible to change drivers
• Perfect for dynamic, complex markets
Cons
• Effective, but not necessarily efficient
• Not suitable for simple/complicated tasks
à Great for narrow and dynamic markets,
Bad for wide and sluggish market

20. Story #3
The story of IT

21. 1960
1970
1980
1990
2000
2010
2020
Complicated
(Business functions)
Complex
(Business processes)
Highly complex
(Business nervous system)
Software crisis
Software engineering
PC
LAN
Internet
Business
Support
of IT
Selective
Holistic
Complicated
Complex
“Moore’s law”
Mobile
IoT

22. 1960
1970
1980
1990
2000
2010
2020
Complicated
(Business functions)
Complex
(business processes)
Highly complex
(Business nervous system)
Software crisis
Software engineering
PC
LAN
Internet
Business
Support
of IT
Selective
Holistic
Complicated
Complex
“Moore’s law”
Mobile
IoT
We are
here …

23. 1960
1970
1980
1990
2000
2010
2020
Complicated
(Business functions)
Complex
(business processes)
Highly complex
(Business nervous system)
Software crisis
Software engineering
PC
LAN
Internet
Business
Support
of IT
Selective
Holistic
Complicated
Complex
“Moore’s law”
Mobile
IoT
… but we still base most of
our decisions on that
We are
here …

24. Formal part of
value creation
Solution:
machine
Dynamic part
of value
creation
Solution: man
sluggishness/low dynamic high dynamichigh dynamic
The historical course of market dynamics
and the recent rise of highly dynamic and complex markets
The dominance of high dynamics and complexity is neither good nor bad. It‘s a historical fact.
t1970/80 today
Age of
crafts manu-
facturing
Age of
tayloristic
industry
Age of
global
markets
1850/1900
Spacious markets,
little competition
Local markets,
high customi-
zation
Outperformers exercise
market pressure over
conventional companies
We call the graph shown here the “Taylor Bathtub”.
Remember the bathtub curve?
This adds an additional twist …

25. 1960
1970
1980
1990
2000
2010
2020
Complicated
(Business functions)
Complex
(business processes)
Highly complex
(Business nervous system)
Software crisis
Software engineering
PC
LAN
Internet
Business
Support
of IT
Selective
Holistic
Complicated
Complex
“Moore’s law”
Mobile
IoT
… but we still base most of
our decisions on that
We are
here …
Business is very different today …
… than it was back then

26. Business
Market
IT today is a …
… Nervous System
… Medium
… Product
… Differentiator
Disruptive
Technologies
Business
Support
Systems
Continuous
Conversation
Digitization

27. What we learned so far …
• Markets changed a lot
• From wide & sluggish (industrial)
• To narrow & dynamic (post-industrial)
• Different organizations required to meet
market needs and demands
• Tayloristic (industrial, centralized)
• Beta (post-industrial, partially decentralized)
• Complex adaptive (post-industrial, decentralized)
• IT itself changed a lot
• From supporter of selective business functions
• To business nervous system and differentiator

28. Time for a law …

29. Conway’s law: Organizations which design systems [...] are constrained to produce designs
which are copies of the communication structures of these organizations

30. Conway’s law reversed: You won’t be able to successfully establish an efficient organization
structure that is not supported by your system design (architecture)

31. Monolith
Example: Multiple teams working on a monolith usually end up in tightly coupled teams
with excessive communication overhead

32. Time for architecture …

33. Industrial
Post-Industrial
What kind of architecture suits the different paradigms
and organizational approaches best?

34. Tayloristic organization
Architectural Drivers
• Core driver: Cost-efficiency
• Centralized control
• Centralized change process
• Minimize cost/feature
• Change response times of
minor relevance
Implies
Application Properties
• Big Applications (“Economies of scale”)
• Large change projects
• Big, infrequent releases
• Long change response times
• Rigid, inflexible architecture
• High degree of configurability
• Optimized for output/$
Leads to

35. Cybernetic organization
Architectural Drivers
• Core driver: Cycle times
• Decentralized control
• Decentralized change
process
• Minimize cycle time/feature
• Change response times are
essential
Implies
Application Properties
• Small, resilient Applications
• Change flow instead of projects
• Continuous releases
• Very short change response times
• Flexible, decoupled architecture
• Configurability of minor relevance
• Optimized for outcome/$
Leads to

36. Time to locate some
architectural styles and technologies …

37. Industrial
Post-Industrial
Monolith
Layered
Architecture
Process Engine
Rule Engine
ESB
Microservice
REST
Event driven
Message driven
Complex
Adaptive
Architecture
Actors
Central
Database
Cloud
Orchestration
Choreography
RPC/RFC

38. Time for some mismatches …

39. Example 1
Microservices on top of a central database

40. Industrial
Post-Industrial
Monolith
Layered
Architecture
Process Engine
Rule Engine
ESB
Microservice
REST
Event driven
Message driven
Complex
Adaptive
Architecture
Actors
Central
Database
Cloud
Orchestration
Choreography
RPC/RFC

41. Example 2
Microservices orchestrated by a process engine

42. Industrial
Post-Industrial
Monolith
Layered
Architecture
Process Engine
Rule Engine
ESB
Microservice
REST
Event driven
Message driven
Complex
Adaptive
Architecture
Actors
Central
Database
Cloud
Orchestration
Choreography
RPC/RFC

43. Example 3
Layered Microservice Architecture

44. Industrial
Post-Industrial
Monolith
Layered
Architecture
Process Engine
Rule Engine
ESB
Microservice
REST
Event driven
Message driven
Complex
Adaptive
Architecture
Actors
Central
Database
Cloud
Orchestration
Choreography
RPC/RFC

45. Example 4
“Cloudifying” a traditional monolith

46. Industrial
Post-Industrial
Monolith
Layered
Architecture
Process Engine
Rule Engine
ESB
Microservice
REST
Event driven
Message driven
Complex
Adaptive
Architecture
Actors
Central
Database
Cloud
Orchestration
Choreography
RPC/RFC

47. Example 5
Architectural requirement from an actual customer project

48. Industrial
Post-Industrial
Monolith
Layered
Architecture
Process Engine
Rule Engine
ESB
Microservice
REST
Event driven
Message driven
Complex
Adaptive
Architecture
Actors
Central
Database
Cloud
Orchestration
Choreography
RPC/RFC

49. Time to come to an end …

50. Wrap-up
• We arrived in the post-industrial age
• The organizations need to adapt
• The role of IT also changed massively
Ø We need to re-think IT!
• Conway’s law affects architecture
Ø Align architecture and organization
Ø Don’t mix solutions for different needs

51. Don’t go for hypes or habits.
Go for needs.

52. @ufried
Uwe Friedrichsen | uwe.friedrichsen@codecentric.de | http://slideshare.net/ufried | http://ufried.tumblr.com