Systems Thinking
One of the primary concepts within new organisational thinking is Systems Thinking. It proposes that in the main the output from a function is dependant on the design of the system not the diligence of the individual.
As an analogy let us look on our own human bodies as a system, or a collection of systems. We have:
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All of these systems are interdependent. If any one system fails then the whole body is affected, often with fatal consequences.
Are organisations this complex? They have:
And just like the body all these functions are interdependent. If any function fails then the whole is affected.
And at the end of the day all these functions should and do work together as a system. All the bodies' systems work together just as all the systems of a company. Healthy bodies and organisations are when all the systems work effectively together. Unhealthy bodies and companies are where all the systems do not work in harmony and there is conflict between the component systems.
With the human body we are fortunate in that a greater being designed the systems and the interrelationships between the systems. With our organisations it is the management or leadership who have this responsibility.
In studying the most successful companies of the twentieth century Porras and Collins concluded that:
Building a visionary company is a design problem.
The quality scholars for the past 50 years have all had the view that if you have a good system then average people will perform and that if you have a poor system then even excellent staff will produce poor quality. In other words the main variable within an organisation is the design of the system. It is not the variability of the people.
Peter Senge talks about us being "prisoners of the system." J M Juran considered that 85% of the outcome was attributable to the design of the system. Edwards Deming thought it was more like 95%. They all agree that it is the leadership who have responsibility for designing the system. They differentiate between workers working in the system (with very little scope to improve the system) and managers working on the system - with extensive opportunity to design improvements.
What does this mean in context of organisational thinking? - Basically it is calling for a shift in our thinking away from the individuals and their skill and dilgence and onto the effectiveness of the operating systems. If the thinking changes, the language will change. The following table contrasts the language used when it is thought that that people are the primary variable with the language used when systems are recognised as the main variable.
| Main Variable People | Main Variable Systems |
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As we have been saying throughout these papers, it is not a gradual transition from one mode of thinking to the other - it is a step change. It is a transformation of our understanding.
System Representation and Analysis
Civilisations over the ages have developed various structures and symbols to aid communication. The spoken word is communicated through our various languages, The written word through various scripts, music through notes recorded on five parallel lines, early telegraph through Morse code, even 'Windows' has its notation format.
Systems Thinking likewise has its own notations and format for the study of organisational systems.
In the simplest form we have the "process" diagram
For each function or task it represents the inputs (from the suppliers), The function itself, and the outputs (to the customers). If we want high quality outputs then we focus on providing high quality inputs - we measure across the whole element.
We can now expand this thinking and portray the inputs, task, outputs and the interrelationships with other tasks. For this exercise we use specific notations and portray them in flowmaps. (Examples of the notations are available under Flowchart Symbols in AutoShapes of the standard Microsoft word package.) Arrows or links indicates connections between each symbol. The common format is to use these symbols in what are called deployment flow maps. With a deployment flow map you record the participants along the top of the page and record the progression of the activities, decisions etc down the length of the page.
There are several flowmapping packages available on the market.
These flow maps can record the company systems at various levels.
We would start with the highlevel map, example given below, from which lower level maps can be evolved. Often with higher levels maps we use a basic flow map rather then the deployment format shown above. The following would be an example:
Many firms have been aproaching the definition of processes or systems through the "Quality" function or standards such as ISO 9000 and have the majority of lower level process defined. However it is a serious ommision if the higher level processs, those that effect Senior Executives and Directors, are not anlaysed with equal diligence. These high level systems, which are much more difficult to define, have a major influence on the effectiveness of the enterprise. As an example we site the example of Arthur Anderson, auditiors to Enron. The BBC programme shown in late July 2002, showed how their reward system distorted their commitment to providing factual truth. They are now having serious difficulty with American legislators.
The recommendation is that the organisation starts with a high level map and from each function cascade down the flowmaps to provide more detail. For example from the high level map shown above we have" Inspection and Delivery" and within inspection and delivery we might have maintenance of inspection equipment which would then lead onto calibration of inspection equipment. The processes or systems are nested in this way so that each employee, and Director, can see and understand where the systems and their particular contribution fits into the whole, how they and their colleagues combine into a team, how their actions can effect others in different functions. The aim is to have all staff thinking holistically.
We would re-emphasis the underlying assumption in the above. We have moved our thinking away from concern about an individual's ability and compliance and onto studying the flow and interdependencies of the work. Consider the contrast to the hierarchical organisational chart. The traditional organigram represents authority and accountability. The process maps represents the team and the interdependencies. The communication and interaction represented by the arrows is every bit as important, if not more so, than the tasks represented by the activity boxes. Furthermore the above is simplistic in that there would, in fact, be communication arrows criss-crossing all the functions. It is however useful as a representation of the cyclical and interdependent nature of organisations.
As we have been saying consistently throughout this article the design of the systems within the company is the responsibility of Leadership. It is their responsibility to design the appropriate responsibilities and links as well as ensuring that there are adequate resources.
Finally we would point the reader to the work of Peter Senge especially in regard to his portrayal of systems as being dynamic. They grow or diminsih relative to the circumstances inherent in the system. There is also invariably a delay between actions and the outcomes of systems. Peter Senge has developed what he calls "Systems Archtypes" to portray dynamic systems. Below is an example:
Furthermore each system does not operate independantly. The many systems current in a company impinge on each other creating complex relationships. Progress is achieved by the diligent understanding of systems. Senge has develop many archetypes to aid this analysis of systems. It is worth visiting the site devoted to the work of Peter Senge - Society for Organisational Learning.- SOL at: http://www.solonline.org/AboutSol/index.html