The Architecture of Complex Systems: Do Core-periphery Structures Dominate?
Executive summary (Via Alan MacCormack, Carliss Y. Baldwin, and John Rusnak)
All complex systems can be divided into a nested hierarchy of subsystems. However, not all these subsystems are of equal importance: Some subsystems are core to system performance, whereas others are only peripheral. In this study, HBS professor Carliss Y. Baldwin and coauthors developed methods to detect the core components in a complex software system, establish whether these systems possess a core-periphery structure, and measure important elements of these structures. The general patterns highlight the difficulties a system architect faces in designing and managing such systems. Results represent a first step in establishing stylized facts about the structure of real-world systems. Key concepts include:
- Core-periphery structures dominate the sample, with 75-80 percent of systems in the sample possessing such a structure.
- It is significant that a substantial number of systems lack such a structure. This implies that a considerable amount of managerial discretion exists when choosing the “best” architecture for a system.
- Variations in system structure can be explained, in part, by the different models of development used to develop systems.
- Legacy code is rarely rewritten, but instead forms a platform upon which new systems are built. With such an approach, today’s developers bear the consequences of design decisions made long ago.
Any complex technological system can be decomposed into a number of subsystems and associated components, some of which are core to system function while others are only peripheral. The dynamics of how such “core-periphery” structures evolve and become embedded in a firm’s innovation routines has been shown to be a major factor in predicting survival, especially in turbulent technology-based industries. To date however, there has been little empirical evidence on the propensity with which core-periphery structures are observed in practice, the factors that explain differences in the design of such structures, or the manner in which these structures evolve over time.