---
title: "Ch 9 — System Three and Three*: inside-and-now, the resource bargain, audit"
description: "System Three holds the inside-and-now together through six vertical channels — three of them by happenstance, three designed — of which the resource bargain…"
url: "https://wiki.cybernetic-futures.org/pure-vsm/part-02-the-viable-system-model/ch09-system-three-and-three"
modified: "2026-11-12T15:26:26.017Z"
language: "en"
site: "Cybernetic Futures"
---

# Ch 9 — System Three and Three*: inside-and-now, the resource bargain, audit

[Chapter content](https://wiki.cybernetic-futures.org/pure-vsm/part-02-the-viable-system-model/ch09-system-three-and-three/ch09-system-three-and-three-content) · Overview diagram

# Ch 9 — System Three and Three*: inside-and-now, the resource bargain, audit

**Part II — The Viable System Model.** The system that holds the operations together in the present: the channels it works through, the bargain that distributes autonomy, and the audit that reaches past the normal route.

## The question
What does System Three actually hold together — and what is the audit channel that reaches the operations without going through it?

## The reading
System Three is the part of the metasystem concerned with the inside and now of the enterprise (HOE 1979: 142), and *Diagnosing the System for Organizations* states the division of labour in one sentence: if System Three is responsible for inside-and-now, a System Four is also needed for outside-and-then (DTS 1985: 111). *Brain of the Firm* lists three kinds of information converging on it — the vertical command axis, on which it works downwards as metasystemic controller, upwards as the most senior filter of somatic news and as an algedonode; the filtered information from System Two, of which it is the only recipient; and the parasympathetic circuits (BOTF 1981: 176).

What the First Axiom requires is that System One's horizontal variety be absorbed by six vertical components of corporate cohesion (HOE 1979: 217). Beer lists them twice. In *The Heart of Enterprise* three arise by happenstance — the environments of the elemental units constrain one another, the operations constrain one another, and the manager's personality plus the attempt of all System One managers to act as a team — and three must be designed: the command channel, System Two and auditing; only the command loop is customarily acknowledged in management theory (HOE 1979: 142–43). *Diagnosing the System for Organizations* gives a different list: corporate intervention, the resource bargain, operational linkages, environmental intersects, System Two, and audits (DTS 1985: 81–82), separating those channels that absorb whatever variety circumstances dictate from those designed to absorb a set amount (DTS 1985: 84).

The resource bargain is the deal by which autonomy is agreed between senior management and its junior counterparts: out of all the activities a unit might undertake, these will be tackled and not those, and the resources negotiated to those ends will be provided (DTS 1985: 38–39) — with accountability as its counterpart (39). The audit, labelled Three*, works sporadically rather than as a perpetual routine, and by agreement with System One management goes straight to the operations themselves; it is the sixth vertical channel (DTS 1985: 82) and, in the later chapters, a typical Three-star function of sporadic high-variety intervention (DTS 1985: 144).

## Beer locators
BOTF 1981: 176; DTS 1985: 38–39, 81–84, 111, 144; HOE 1979: 142–43, 211, 215, 217, 352, 354.

## Status
Draft, *Pure VSM* v0.8 (2026-09-23). Beer's texts govern where the draft and they differ.

The reading reproduces both lists of the six components, because the draft itself does, and marks that they are not identical rather than harmonising them.

## Open points
- HOE uses "3*" in one sense only: inside System Five, as a model (352, 354). The audit channel is described there in words — "auditing" (143), "the AUDIT" as a high-variety channel (211), "the new System Three channel that runs directly to the operations" (215). Figure labels in HOE are not captured by the text layer and would need a printed copy or a scan to settle.

## Related
[Part II — The Viable System Model](https://wiki.cybernetic-futures.org/pure-vsm/part-02-the-viable-system-model), [Ch 8 — System Two](https://wiki.cybernetic-futures.org/pure-vsm/part-02-the-viable-system-model/ch08-system-two), [Ch 10 — System Four](https://wiki.cybernetic-futures.org/pure-vsm/part-02-the-viable-system-model/ch10-system-four), [System Three](https://wiki.cybernetic-futures.org/pure-vsm/concepts/system-three), [Principles and axioms of organization](https://wiki.cybernetic-futures.org/pure-vsm/concepts/principles-and-axioms-of-organization), [Viability, identity and autonomy](https://wiki.cybernetic-futures.org/pure-vsm/concepts/viability-identity-and-autonomy), [Diagnosing the System for Organizations](https://wiki.cybernetic-futures.org/pure-vsm/entities/diagnosing-the-system-for-organizations), [The Heart of Enterprise](https://wiki.cybernetic-futures.org/pure-vsm/entities/the-heart-of-enterprise).