Functional Complementarity
Organizations achieve functional complementarity when different business units perform different functions in the portfolio: cash generation vs.
Diverse systems don't just buffer variance - they often increase total function through complementarity.
Different species use resources in different ways, reducing competition and increasing total resource capture. Plant species root at different depths - some shallow, some deep. Some photosynthesize efficiently in full sun; others specialize in shade. Some fix nitrogen; others don't. When multiple strategies coexist, the community exploits the environment more completely than any monoculture could. This is niche differentiation at the community level. The Jena Experiment showed diverse plots rooted 30% deeper, bloomed across more months, and captured 40% more nitrogen than monocultures - demonstrating 'overyielding' where mixtures outperform even the best monoculture.
Business Application of Functional Complementarity
Organizations achieve functional complementarity when different business units perform different functions in the portfolio: cash generation vs. growth, premium margins vs. volume, immediate revenue vs. long-term options. Berkshire's insurance businesses generate float that funds capital-intensive businesses - together creating a system where each component enables the others.