Most of the work in modelling of social systems focuses on the actual codification of such models thus taking for granted the underlying assumptions and the modelling process itself. This paper describes an innovative conceptual framework for modelling combining the opposing traditions of subjectivism and objectivism, materialism and idealism, chaos and equilibrium, absolutism and relativism, ethics and pragmatism . It is based on perspectives opened by cognitive science, chaos theory, systems thinking, requisite variety and hermeneutics. The enquiry introduces an observer and his cognizing capability and addresses human factors' concerns in modelling of social systems. References to practical management issues have been emphasised where possible. The authors suggest that research into human factors, and specifically how people interact among themselves and with the world and how they commit themselves to action and acquire new behaviours should be enhanced. They refer to the importance of models that include generation of organizational competencies and knowledge creation.