This is the first of a series of 12 articles on systems thinking, a way of understanding complex organizations and society offering significant promise for improving the leadership and management of
commercial companies, not-for-profit organizations, and government agencies. Part 1
An Introduction to the
Systems Approach
By H. William Dettmer
There is no question that in our age there is a good deal of turmoil about the manner in which society is run. Probably at no point in the history of man has there been so much discussion about the rights and wrongs of the policy makers…[Citizens have] begun to suspect that the people who make the major decisions that affect our lives don't know what they are doing… They don't know what they are doing simply because they have no adequate basis to judge the effects of their decisions. To many it must seem that we live in an age of moronic decision making.
—C. West Churchman
The Systems Approach [Introduction] [1:vi]
Sounds like Churchman is talking about us today, doesn't it? The preceding quotation comes from the introduction to his seminal book on systems thinking, The Systems Approach, written in 1968. That's sad testimony to the fact that few decision makers in the world have learned much about complex systems in the last 37 years. In the immortal words of Winston Churchill, “Man will occasionally stumble over the truth, but usually he just picks himself up and continues on.”
We've been “continuing on” for four decades. It's time to go back and revisit that truth we stumbled over in 1968. We can snicker at the fact that life seemed so much simpler then. The world has “gotten smaller” as travel, communication, the information age, and the Internet have combined to connect people and societies as never before. As economies have evolved from regional to national to transnational to global, our organizations have grown in size and complexity. It is nearly impossible for the people running them to fully understand what goes on “where the rubber meets the road” in nations, governments, and
companies.
Analysis versus Synthesis
Since the turn of the century (the 20th century, that is), the accepted approach to dealing with increasing complexity is to try to reduce it into manageable “bites” and address them in isolation. This approach is referred to as analysis. We analyze a complex situation or issue by trying to break it down into component pieces and consider each in isolation from the others. This kind of thinking has its roots in analytic
geometry, where one basic axiom is that the whole is equal to the sum of its parts. Think about that for a moment. The underlying assumption behind this conclusion is that all of the parts are essentially
independent of one another.
But although this mathematical thinking might apply to bricks and other inanimate objects, it fails when applied to dynamic, homeostatic, or cybernetic systems [2:28-31]—which generally include any organic systems, or those where human beings have a role. And unfortunately such systems are the ones that exert the most influence on our lives. We see the failure of the analytical approach all the time: The Rohr Corporation's Riverside, California, plant recorded a 55% increase in profits in 1996. Great news, if all you focus on is short-term profits. When you look at the larger system, you see the reason for that increase is better “efficiency” (meaning cost cutting) temporarily had a greater impact than the 3% decline in sales. Or, as the corporate treasurer enthusiastically observed, “Costs have come down quicker than our revenue has decreased.” [3:G-1]. (I'm sure the 3,500 people laid off at Riverside by Rohr in the
preceding few years are immensely gratified to know that!) The Rohr story is a classic example of self-delusion by analytical thinking.
If an analytical approach to management is counter-productive, what should we be doing instead? A holistic, or whole system approach is considerably better suited to the kinds of complex organizations we usually encounter today. What's the difference between an analytical and a systems approach? The systems approach represents synthesis-thinking with an integrated perspective about the whole enterprise. Before one can synthesize, one must first analyze. In other words, we first take the system apart (usually conceptually-it's not often practical to physically deconstruct the systems we normally work with) to understand the functions of each link or component. Once the components are fully understood in isolation, we study the interactions among components to understand how the system as a whole functions. Understanding these interactions requires integrating the components into something larger and more capable than the components represent alone. In the fourth installment of this series, we'll examine analysis and synthesis in more detail. And in the ninth installment, we'll consider some tools to help us visualize and manage a system as an integrated whole.
A Paradigm Shift
In 1962, Thomas Kuhn introduced the word paradigm [4:x] to describe a pattern of knowledge, rules, assumptions, or thinking. The difference between an analytical approach to management and a synthesis approach might easily be characterized as a paradigm shift, or a significant change in the “rules of the game.” Paradigm shifts can be either evolutionary (i.e., a slow pace of change) or revolutionary-dramatic, short-term, and immediate high impact. The rise to primacy of air travel over ships was an evolutionary change. The advent of the atomic bomb was a revolutionary shift-almost overnight-in the way we looked at national defense.
The shift from analysis to synthesis in the way we consider systems is assuredly an evolutionary
paradigm shift. It's been under way for nearly 40 years. It started in engineering, where synthesis has been the source of creativity and innovation. Even now, an Internet search on “analysis versus synthesis” will turn up a preponderance of engineering references. But since Churchman's work, the concept of synthesis has begun a transition from the purely technical arenas to the sociological, ecological, environmental, and philosophical. So far, this transition seems to have been neither consistent nor continuous. In fact in some respects, as our world has become more complex, many leaders and managers seem to have retreated even more deeply into analytical thinking: “If our world is getting more difficult to manage, we need to
analyze the situation more. We need more detailed information!” (Who was is that said “the definition of
insanity is doing the same thing over and over, and expecting a different result”?) The Importance of Theory
Theory can be a slippery word. Many (most?) people outside the science community don't really
understand the meaning of the word. I frequently hear executives say, “I don't have time to worry about theory-I'm too busy dealing with the real world.” A similar comment one frequently hears is, “Well, that's only a theory.” Both statements indicate an erroneous perception that theory is no more than speculation, or a best guess. Nothing could be farther from the truth.
W. Edwards Deming, one of the people who taught the Japanese the concepts of quality that they
subsequently used to hammer the west economically for the last quarter of the 20thcentury, said this about theory:
Experience alone, without theory, teaches management nothing about what to do to improve quality and competitive position, nor how to do it…Experience will answer a question, and a question comes from theory. [5:19]
Without theory, there is no learning…Theory is a window into the world. Theory leads to prediction. Without prediction, examples and experience teach nothing. To copy an example of success, without understanding it with the aid of theory, may lead to disaster. [6:106]
Deming was not the first or only system thinker, but because of his impact on Japanese business, he happens to be one that many people pay attention to. Not long before he died, Deming proposed what he called his system of profound knowledge. [6: 94-118] Successful transformation of any organization, Deming suggested, depending on a thorough understanding of four components of profound knowledge. These components include appreciation for a system, knowledge about variation, the theory of
knowledge, and an understanding of psychology.
Grossly oversimplified, Deming was saying that if you don't see your environment as a system of
interdependent parts, you don't understand the nature of variation within and among those parts, you have no clue about why or how you know what you know about your system, and you don't comprehend the psychology that drives the humans that make up your system, you haven't got a chance success-except by dumb luck. (And who would be comfortable depending on that?) In the sixth installment of this series, we'll see how Deming's idea of profound knowledge will help us understand and manage our systems as systems.
The Scientific Method
All of these concepts we've examined so far-analysis and synthesis, the importance of theory, and Deming's system of profound knowledge-represent the underlying foundation for an effective systems approach to management. But they are no more than a foundation without a methodology to follow. The scientific method is an excellent transition from foundation to practice.
The scientific method begins with informal observation of discrete phenomena or events. The person practicing the method, sensing a connection of some kind among the events and using inductive logic, generalizes a hypothesis to explain the cause-and-effect relationship between them. This hypothesis is then tested either by experimentation or more intensive observation to confirm or refute the hypothesis. If the hypothesis is invalidated, it's usually “thrown away.” On the other hand, if there seems to be some confirmation in the experiments or observations, then the hypothesis takes on the characteristics of a theory: a proposition with some evidence to support it. As time goes on and more data on the subject is accumulated, some aspects of the theory may be reinforced, and some data points that don't fit the theory may be discovered. If these data can't be adequately explained in light of the theory or accepted
knowledge, then the theory may be abandoned. However, it is more likely that the theory will be modified to fit the existence of the outlying data points. In this way, the theory is improved, and our knowledge of reality is enriched. In other words, we have learned something! This learning is at the heart of Peter Senge's classic management book, The Fifth Discipline. [7]
The importance of learning in any endeavor cannot be overemphasized. George Santayana once said, “Those who cannot learn from history are doomed to repeat it.” This is another way of saying “Learn from your mistakes, or you'll have to do them over again until you get it right.” (Remember the definition of insanity, mentioned earlier?)
Summary
There is a paradigm shift underway, from analytical thinking to systems thinking. In time, it will transform the way business is done, in commercial enterprise, government, and the not-for-profit sector. You can ride the leading edge of this wave, or you can swim like the devil to try to catch up with it after it's passed. Over the next twelve months, we'll see how you can do the former, if you're so inclined. We'll see how theory and sound methods will contribute to the challenge of learning more about our systems, how they function, and how to get improvement efforts right the first time.
Winners make things happen. Losers let things happen, or watch things happen and wonder what happened.
—Unknown
Endnotes
1. Churchman, C. West. The Systems Approach. New York: Dell Publishing Co., 1968. 2. Athey, Thomas H. The Systematic Systems Approach. New Jersey: Prentice-Hall, 1982.
3. “Rohr reports big increase in earnings,” The Riverside (California) Press-Enterprise, May 22, 1996, p.G-1
4. Kuhn, Thomas S., The Structure of Scientific Revolutions. Chicago, IL: University of Chicago Press, 1962.
5. Deming, W. Edwards. Out of the Crisis. Cambridge, MA: MIT Center for Advanced Engineering Study, 1986.
6. ______. The New Economics for Industry, Government, Education. Cambridge, MA: MIT Center for Advanced Engineering Study, 1993.
7. Senge, Peter. The Fifth Discipline: The Art and Practice of the Learning Organization. New York: Doubleday, 1990.
This is the second of a series of 12 articles on systems thinking, a way of understanding complex organizations and society offering significant promise for improving the leadership and management of
commercial companies, not-for-profit organizations, and government agencies. Part 2
Business and the Blitzkrieg
H. William Dettmer
It would be foolish, however, to disguise the gravity of the hour. It would be still more foolish to lose heart and courage or to suppose that well-trained, well-equipped armies numbering three or four millions of men can be overcome in the space of a few weeks, or even months, by a scoop or raid of mechanized vehicles, however formidable. We may look with confidence to the stabilization of the Front in France…
—Winston Churchill, May 19, 1940 [1:17-18]
Prophetic words—too bad they were completely wrong. Thirty-two days later, in the same railroad car, at the same place where Germany signed an unconditional surrender in 1918, Hitler accepted the surrender of France.
During World War II, no battle group struck more fear into the hearts of its opponents than the German panzer corps. In 1939-40, fast-moving tank divisions, operating in independent, flexible, small groups, swept across Poland in 26 days. The Baltic States fell in less than a week, Denmark in four hours, and France in five weeks. [2] British forces on the continent were pushed back against the sea at Dunkirk. The only reason they survived to be evacuated across the English Channel (by small boat flotilla) was that the Germans inexplicably decided to stop their advance. Later, in 1942, Rommel's panzers similarly ran the north coast of Africa from Egypt to Morocco, devastating British forces.
The British and French armies, in particular, were standing, well-trained professional armies. Why, then, were the German panzer corps so effective while their opponents acted so confused?
Learning from Experience
The difference: The Germans learned more from their experience in World War I than the Allies (including the Americans) did. While the British, French, and Americans focused on deploying
technology improvements, they pretty much prepared mentally to re-fight the direct, slow-moving frontal engagements of “the war to end all wars.” (Too bad it really wasn't that!)
Spearheaded by the creative Prussian military genius, Heinz Guderian, the German Army developed the concept of maneuver warfare we know as the blitzkrieg - literally, “lightning war”—and it caught the world totally by surprise in 1939. [2]
For decades, businesses throughout the world have operated much the same way the French and British did in 1939: they're fighting the last engagement, albeit with newer technology, such as the Internet, e-business, and sophisticated information systems such as Enterprise Resource Planning (ERP). But their thinking, and the behavior that springs from it, remains the same as it always has been.
However, as in 1939, times have changed. While the world has “grown smaller,” it is in many respects a less stable place now than it was in the 1930s. This is especially true of economics and politics.
German tacticians created the blitzkrieg to defeat discrete, known opponents through speed, flexibility, agility, and surprise--a concept that can be generally characterized as maneuver warfare. It has long been accepted that these same attributes of maneuver warfare can be translated into other domains, such as business.
But whereas the military application of maneuver warfare is aimed at discrete, specific opponents, its application to business is may be less distinct. Yes, maneuver tactics in business can be particularly effective in head-to-head competition between specific competitors. But their greater value may be in their ability to help a business respond rapidly to a volatile, ever-changing operating environment. In other words, the concepts of maneuver warfare can help organizations deal with the uncertainty of a world that, more than ever before, is not standing still. Moreover, by understanding maneuver warfare as a potential strategic advantage, companies can develop a level of comfort embracing what Peter Drucker has called “discontinuous change”—even seeking it out or, better yet, leading it!
Our real opponent in business is the uncertainty of a volatile, constantly changing environment, as much as it is any particular competitor. In such circumstances, is the ability to change directions (and actions) “on a dime” any less important just because we're responding to events, rather than opponents?
There's an old saying: “When life hands you lemons, make lemonade.” Sound simple enough, but the ability to make this kind of adjustment on short notice demands the flexibility and agility—the
responsiveness—that maneuver warfare offers. But it's one thing to say this; it's quite another to apply it. So it's appropriate to examine the philosophical foundation on which the blitzkrieg and its success were built.
The Conceptual Foundation of Blitzkrieg Tactics
The ability of the German panzer divisions to sow such dramatic confusion and fear among their
adversaries depended on four interrelated concepts that were impressed into every member of those units:
einheit, fingerspitzengefühl, auftragstaktik, and schwerpunkt. [1:51-59] Okay, so these words are a real
mouthful for those not fluent in German. Let's take them one at a time.
Einheit. (pronounced “aye'n-height”). The literal meaning of the word is mutual trust. It's the sense of well being a member of a cohesive team realizes from knowing that he or she can depend utterly on fellow team members—superiors, subordinates, and contemporaries alike—for help, support, or just faithfully doing what's expected of them.
Mutual trust can't be mandated or imposed. It develops over time—it's earned, by all parties to the mutuality, and that doesn't happen overnight. Einheit is more than simple camaraderie, though it includes that, too. It's knowing that other team members will be in the right place at the right time to do whatever the situation dictates in fulfilling their responsibilities for mission accomplishment.
Fingersptizengefühl. (pronounced “finger-SHPITZ-in-geh-fyool”) Literally “fingertip feel,” or “touch,” it really implies intuitive skill. This is the consummate skill in doing something that comes from having done it so many times, or for so long, that, as the song of the same name goes, “nobody does it better.” It's the kind of expertise that world-class musicians such as Yitzhak Perlman or Yoyo Ma have. They don't
need to read the music and consciously translate it to hand movements; the music just flows from their
heads, where they hear it in all its detail, through their fingertips to the instrument—instinctively and inherently correct the first time.
Fingerspitzengefühl is inextricably tied to einheit. As a team works together over time, they become
better at what they do, both individually and collectively. This breeds confidence in one another, which is fundamental to realizing mutual trust. Who would you trust more: a world-class performer with whom you'd worked regularly, or a newcomer you've never seen before and know only by their résumé or press notices?
Auftragstaktik. (pronounced “OWF-trags-TACtic”) This is a virtual or implied contract between superior and subordinate. Simply put, the superior tacitly avoids ordering a subordinate to do something. He or she asks the subordinate to accept the responsibility for getting it done. Einheit and
fingerspitzengefühl figure prominently into the auftragstaktik. Because the team has worked together
repeatedly for a long time, they have developed an intimate knowledge and respect for each other's skills and capabilities. Superiors know what subordinates are capable of and where their limitations lie. For their part of the contract, superiors avoid asking subordinates to take on responsibilities beyond their capabilities without having a valid, justifiable reason. For their part of the contract, if they accept the superior's charter, subordinates agree to accomplish what has been asked of them, applying the steel self-discipline that comes of fingerspitzengefühl and every last ounce of their effort to get the task
accomplished as the superior expects it to be done. The subordinate implicitly trusts the superior not to ask more of him or her than they are capable of doing. The superior implicitly trust the subordinate to deliver what he or she has agreed to do without continually having to be checked or prodded.
Schwerpunkt. (pronounced “SHVER-punked”) Literally, “hard or difficult point,” the real meaning is more like center of gravity, or focus point-the place where the majority of effort is directed. For the German panzers, this was the target of the main thrust of combat efforts. In the practice of constraint management [3], this is the system constraint. Two underlying assumptions are inherent in the concept of
schwerpunkt. The first is that in a complex operation, some parts of the organization—the ones most
directly responsible for the schwerpunkt—are more critical to immediate success than others. But going hand in hand with the schwerpunkt is the idea of nebenpunkt, or essential supporting activities.
The classic (and most successful) example of the military application of the blitzkrieg—and schwerpunkt and nebenpunkt as well—is the German attack on France in 1940 through the Ardennes Forest. With French and Belgian troops massed in the Belgian plains against German Army Group A, German Army Group B moved quickly through the narrow roads of the Ardennes toward the city of Sedan. Thinking this approach improbable, the French defended Sedan with third-rate troops and reserves. As the Germans slashed through the Ardennes, the French defenders broke ranks and ran, even before the panzers
completed their crossing of the Meuse River. Army Group B wheeled around to the north and enveloped the French and Belgian armies from the rear. (Turn this whole layout 90 degrees clockwise, and you essentially have General Schwarzkopf's “left hook” maneuver with the VII and XVIII Corps in Operation
Desert Storm.)
In the conquest of France, the schwerpunkt was the Ardennes penetration. The nebenpunkt was the supporting role played by Army Group A, whose primary function was to draw the attention of French and Belgian forces (which it did most successfully) while Army Group B circled around from behind. We'll examine this concept of schwerpunkt and nebenpunkt more in the fourth installment of this series. Leading by Intent
The immediate benefit in einheit, fingerspitzengefühl, auftragstaktik, and schwerpunkt accrues primarily to the senior commander (the CEO, if you will). Rather than having to specify in detail everything he wants each subordinate to do, the commander can lead by intent. The leader of a blitzkrieg-oriented organization can describe the desired outcome and assign the resources to trusted team members, who, by virtue of their mutual trust, intuitive skill, and complete understanding and acceptance of the mission contract, can be utterly depended on to deliver the results. Subordinates are comfortable exercising their own initiative in their pursuit of the mission, and superiors are completely comfortable letting them do so. Summary
What do the blitzkrieg and its underlying concepts have to do with a systems approach to management? As we saw in the first installment, the increasing complexity and size of the economic and political organizations in our world make an authoritarian control model impractical. No leader of such a system can possibly keep tabs on everything. In as unstable and dynamic an environment as we live in today,
changes are demanded faster than their impacts can be analyzed—sometimes even faster than information about the need to change can be passed.
Success depends on responsiveness and agility, which in turn depend on the independence of team members to act without constantly requiring approval. Such independence depends on their willingness to take initiative, which in turn rests on a climate of mutual trust (einheit), intuitive skill and capability (fingerspitzengefühl), the confidence and assurance of an implied mission contract (auftragstaktik), and an unswerving focus on the most important effort (schwerpunkt).
In the future, all organizations will have to become faster, more responsive, more agile, and more unpredictable (to their competitors) or risk being relegated to “loser” status. And we know what losers do—they let things happen, or watch things happen and wonder what happened! We don't want that to be us, do we?
Tactical agility is the ability of a friendly force to react faster than the enemy. It is essential to seizing, retaining, and exploiting the initiative. Agility is mental and physical. Agile commanders quickly comprehend unfamiliar situations, creatively apply doctrine, and make timely decisions. [4] Endnotes
1. Richards, Chet. Certain to Win. Xlibris Corporation, 2004.
2. Macksey, Kenneth. Guderian: Creator of the Blitzkrieg. New York: Stein and Day Publishers. 1975. 3. Goldratt, E.M. The Haystack Syndrome: Sifting Information from the Data Ocean. Great Barrington, MA: The North River Press, 1990.
This is the third of a series of 12 articles on systems thinking, a way of understanding complex organizations and society offering significant promise for improving the leadership and management of
commercial companies, not-for-profit organizations, and government agencies. Part 3
Destruction and Creation:
Analysis and Synthesis
H. William Dettmer
Let us not lose sight of the fact that the etymological root of the word analysis is “anal.” —Unknown
The word “analysis” has been overused, to the point becoming a cliché. We have environmental analysis, business analysis, financial analysis, cost-benefit analysis, metallurgical analysis, spectrographic analysis, and systems analysis (which has come to refer too narrowly to information systems). Even these are only a partial list. We're virtually awash in analyses. The concept of analysis is deeply embedded in our lives, but where did this concept come from? And why should you care about it?
Since the Renaissance, analysis has been the foundation of problem solving. But as we move from the 20th into the 21st century, it's becoming clearer that analysis alone is an incomplete, suboptimal way of understanding and functioning in our world. Worse, without the next step—synthesis—practicing analysis alone is a dangerous way of operating.
Analysis Equals Reductionism
What, exactly, is analysis? Simply put, it's a process of reducing a complex whole, or system, into its component parts—manageable “bites”, if you will—and dealing with those parts in isolation. Take an automobile, for example. The engine is a complex system made up of many components. If the engine runs roughly, the analysis approach is to mentally “deconstruct” the engine into carburetion (or fuel injection), fuel supply, fuel transport system, and combustion chamber (cylinders). The person repairing the engine “analyzes” the situation: he or she examines and “tweaks” each of these parts individually. Fuel injectors are checked, and perhaps cleaned. The fuel pump is checked for proper operation and the filter replaced. Spark plugs are cleaned or replaced, and timing may be adjusted. Then the components are rejoined again. Often the car is returned to the owner with all these things done (accompanied by a substantial bill!), and the owner finds that the engine doesn't run substantially more smoothly. The reason may be that the repair person failed to “synthesize” the system again—to ensure that all the adjusted components actually function well together.
The assumption underlying the concept of analysis is reductionism, the idea that all the reality of our ultimate experience can be reduced to indivisible parts. [1:9] From the 15th through the 19th centuries, a reductionist philosophy predominated all scientific inquiry and the expansion of human knowledge. It was assumed that if a phenomenon was deconstructed sufficiently and the parts examined, understanding of the phenomenon was assured. In fact, this thinking is embodied in one of the basic axioms of analytic geometry: the whole is equal to the sum of its parts. But a funny thing happens with complex systems: interdependence among the parts rears its ugly head—what some have called synergy comes into play! The reductionist, or analytic approach reached its culmination with the concept of scientific management in the early 20th century. The father of scientific management, Frederick W. Taylor broke down
(analyzed) complex industrial activities into component tasks, sought to make those tasks more efficient, and “glued” the more efficient components back together again. The expected result was a more efficient, effective system. Taylor's disciples, including Frank and Lillian Gilbreth and Henry Gantt, extended and refined Taylor's analytic approach to management well into the 1950s essentially unchanged.
Deficiencies in Analysis
Because early organizational (specifically, industrial) systems were simple, the analytic approach was much more effective than the alternative—which was more or less ad hoc. But as the complexity of organizational systems increased to the point where no one person could have complete visibility on all components simultaneously, the “cracks in the plaster” of the analytic approach began to show. Analysis could no longer explain the difference between the whole-equals-the-sum-of-the-parts and observed results that were disproportionately higher (or lower) than expected. In other words, the success of an analytical approach “topped out.”
The problem is that parts of systems have properties that they lose when separated from the whole system, and the whole system has essential properties that none of its parts does. Ackoff provided an effective analogy: The eye detached from the body can't see, yet the human body as a whole can run, play piano, read, write, and do many other things that none of its parts can do by themselves. [1:16]
What does all this mean? Basically, that the essential properties (and thus the ultimate performance) of a system derives from the interactions of its parts. And these essential properties are lost when the system is taken apart. In other words, a system is a whole that cannot be understood by analysis alone.
Synthesis: The Second Half of the Equation
What, then, is the key to resolving this deficiency? The answer is synthesis. Simply put, synthesis is amounts to putting things together. Sometimes these are pieces known to be part of a system, for
example, the rebuilding of an automobile engine from its disassembled parts. In other cases, it may be the combination of things never thought of as “going together” before, to create new concepts, solutions, or realities.
Synthesis is not a new idea; it's as old as analysis. As Ackoff has pointed out, Aristotle dealt with both. [1:17] But in our current world of complex systems, synthesis becomes more important than most people realize. Analysis and synthesis are complimentary processes; though they can be considered separately, they can't really be separated. Systems thinking doesn't deny the value of analysis, however. Rather, it emphasizes the fact that there is another side to the system equation that has, until recently, been ignored or overlooked.
In 1976, John R. Boyd, a retired U.S. Air Force colonel whose chief claims to fame had been his
development of the energy-maneuverability theory and the latest-generation fighters (the F-15 and F-16), tackled the issue of analysis versus synthesis in a paper entitled Destruction and Creation. [3]
The core of Boyd's argument was that creativity was essentially the outcome of a process of analysis and synthesis, which he referred to as destruction and creation. Boyd suggested that new ideas and
breakthrough solutions to particularly challenging problems resulted from mentally deconstructing multiple known existing concepts or processes, then selectively reassembling key elements to form a completely new concept—thus, the characterization as “destruction and creation.”
Creativity and Synthesis: Building Snowmobiles.
In the mid-1980s, Boyd offered an analogy to illustrate this process of analysis (destruction) and synthesis (creation). [4] He challenged people to think of four seemingly unrelated mechanical systems: a set of snow skis, a boat with an outboard motor, a bicycle, and a military tank or tread-type earthmover. Each of these is a discrete device with its own purpose. Boyd suggested mentally deconstructing these into their component parts and selectively re-combining parts from each to for a new “whole” that would not otherwise exist. He discarded the bindings and poles from the snow-skis, retaining only the “boards.” From the outboard boat, he retained only the gasoline-powered motor; from the bicycle, the handlebars, and from the earthmover, a tread. He recombined these concepts (the functions of the different parts) to form…a snowmobile!
The snowmobile concept became Boyd's short-hand analogy for characterizing the domain of
competition. He separated people into two types: those who could conceive and build snowmobiles, and those who couldn't: [5:156]
“A loser is someone (individual or group) who cannot build snowmobiles when facing uncertainty and unpredictable change; whereas a winner is someone who can build snowmobiles and employ them in appropriate fashion, when facing uncertainty and unpredictable change.” [5:182]
Hand in hand with being able to build snowmobiles, Boyd suggested, is adaptability—the capability to respond to a situation with variety and rapidity. Variety is an outgrowth of analysis and synthesis. Rapidity implies the ability to analyze and synthesize quickly.
Paradigms
Let's briefly consider a concept seemingly unrelated to Boyd's destruction-and-creation process: the idea of paradigms. The term was coined by Thomas Kuhn in 1962, in his seminal book, The Structure of
Scientific Revolutions. [6:x] Kuhn's original treatise dealt with the evolution of scientific theories,
particularly the physical sciences. Through the later work of others, primarily Joel Barker [2], it has since come to be applied more widely (and broadly) to the realms of business management, societal
development, and social interaction.
Grossly oversimplified, a paradigm is a model, a set or rules, or a pattern of behavior that defines current, accepted (and acceptable) thinking about a domain or subject. For example, the game of baseball is a paradigm operating within the confines of a stadium and the organizational structures behind the competing teams. Behavior of those within this paradigm is largely prescribed within relatively well defined boundaries. Concepts associated with other paradigms (e.g., football, tennis, or aviation) are excluded from baseball “thinking.”
Likewise, at the higher economic and political levels, capitalism and democracy are also paradigms. Thinking within these paradigms is somewhat constrained by the “traditional,” the accepted, or common practice.
Kuhn introduced the notion that paradigms change over time, as more and newer information is
discovered. In most cases, this change is evolutionary, rather than revolutionary. As Barker has pointed out, however, paradigm “shifts” can often be dramatic. The Internet and its many and varied uses is an example of such a rapid paradigm shift. A key characteristic of paradigms and their associated shifts is the idea that they naturally evolve or “happen”—they're not consciously directed.
Summary: Our OWN Synthesis
To summarize what we've seen so far, let's do a little “destruction-and-creation” of our own.
Ackoff, Churchman, and other system thinkers maintain that the widespread current practice of analyzing systems and issues alone—that is, breaking them down into their component parts and maximizing performance of the discrete parts—is a flawed practice, because it ignores the central role of interdependencies.
Kuhn and Barker suggest that the rules of the “meta-game” change over time, sometimes with dramatic shifts that must be discerned and accommodated. Failure to do so can leave one “behind the power curve.” That's an aviation term implying that the pilot has allowed the aircraft enter a condition where much more power is required just to maintain or arrest a deteriorating flight condition. Or, in management terms, “Have you seen them? Which way did they go? I must be after them, for I am their leader!”
And finally, Boyd maintains that the kind of destruction-and-creation process (analysis and synthesis, in Ackoff's terms) he recommends produces the ability to dictate rules and results of an engagement. The people and organizations that become really good at doing this can achieve a much greater degree of influence over their environment. (Boyd referred to this as “improving their capacity for independent action.” [3]
So, what does our “snowmobile” look like? If paradigms govern conventional thinking about how things happen, or must be done, and if our organizations are arrangements of systems, sub-systems, and meta-systems that can't be effectively managed analytically, then the application of a conscious, pro-active method of destruction-and-creation (analysis and synthesis),systemically applied, can put practitioners of such methods at a tactical advantage over competitors. It can also keep them ahead of the environmental changes that evolve over time—and perhaps be in a position to drive or lead revolutionary paradigm shifts. Which position would you rather be in: chasing after a changing environment, or leading the change?
In our next installment, we'll examine the O-O-D-A loop, a prescriptive approach to applying analysis and synthesis to secure the “high ground”—Boyd's improved capacity for independent action—in our chosen fields.
Endnotes
1. Ackoff, Russell L. Ackoff's Best: His Classic Writings on Management. New York: John Wiley & Sons, 1999.
2. Barker, Joel. (http://www.joelbarker.com)
3. Boyd, John R. Destruction and Creation. An unpublished paper. (http://www.goalsys.com/id17.htm) 4. Boyd, John R. “Revelation,” part of the August 1987 version of the larger unpublished briefing, A Discourse on Winning and Losing. Cited in Hammond, Grant T., The Mind of War: John Boyd and
American Security, Washington, D.C.: The Smithsonian Institution Press, 2001, p.182.
5. Hammond, Grant T. The Mind of War: John Boyd and American Security. Washington, D.C.:The Smithsonian Institution Press, 2001.
6. Kuhn, Thomas S. The Structure of Scientific Revolutions. Chicago: The University of Chicago Press, 1962.
This is the fourth of a series of 12 articles on systems thinking, a way of understanding complex organizations and society offering significant promise for improving the leadership and management of
commercial companies, not-for-profit organizations, and government agencies. Part 4
Operationalizing Sun Tzu: The O-O-D-A Loop
H. William Dettmer
Those who win every battle are not really skillful-those who render others' armies helpless without fighting are the best of all.
—Sun Tzu, The Art of War [1:67]
By now most people have heard of the ancient Chinese general, Sun Tzu, and his writings about military strategy called The Art of War. Sun Tzu lived about 2,400 years ago. What many may not realize, however, is that The Art of War is a compendium of cogent military thought that has been amplified and expanded upon through the 12th century AD by other skillful Chinese generals—“the best of Chinese military genius”, one might say.
Somewhat fewer people (but still a significant number) are aware that principles articulated in The Art of
War can be translated to the domain of business. Some business schools even require students to read The Art of War as part of their curriculum. However, though they may have done such required reading, very
few business students of Sun Tzu are really adept at translating those precepts to practice. Some authors (McNeilly, for one) have done so and written about it. [2]
Clearly, there are parallels between military engagements and business, or, for that matter, with
competitive sports, or other comparable activities where winning or losing (however one defines those) is possible. The principles in The Art of War can be effectively applied to such situations, whether the opponent is a specific adversary or even just an unforgiving environment itself.
The Art of War is replete with useful information, both strategic and tactical—too much to analyze at
length here. That's not the purpose of this installment in any event. For our purpose—showing how to make that application leap that so many haven't been able to do—it's sufficient to select a few of Sun Tzu's key principles. Here are the ones we'll address:
1. If you know others and know yourself, you will not be imperiled in a hundred battles…if you do not know others and do not know yourself, you will be imperiled in every single battle. [1:82]
This principle addresses the importance of understanding your own system-its capabilities, needs, objectives, and values-as well as those of your opponents.
2. Unless you know the mountains and forests, the defiles and impasses, and the lay of the marshes and swamps, you cannot maneuver with an armed force. [1:116]
This principle emphasizes the need to fully understand the external environment in which you—and your adversaries—operate in. In business, this is more than just the market conditions or the regulatory environment. It includes the political and cultural environment as well.
3. I have heard of military operations that were clumsy but swift, but I have never seen one that was skillful and lasted a long time. It is never beneficial to have [an] operation continue for a long time. [1:58] In this observation, Sun Tzu points out the importance of speed in commencing and concluding
4. Act after having made assessments. The one who first knows the measures of far and near wins. [1:119]
The emphasis here is on making assessments. This is another way of saying “synthesize all your information into a clear picture of what is going on and where you stand in the situation; then act.” (presumably with the speed advised in 3, above!)
5. Generals who know all possible adaptations to take advantage of the ground know how to use military forces. If generals do not know how to adapt advantageously, even if they know the lay of the land they cannot take advantage of it. [1:126]
6. Adaptation means not clinging to fixed methods, but changing appropriately according to events, acting as is suitable. [Zhang Yu] [1:125]
7. A military force has no constant formation, water has no constant shape: the ability to gain victory by changing and adapting according to the opponent is called genius. [1:113]
These three precepts are all about flexibility and the capability to adjust (or adapt) to new situations— again, quickly.
8. In battle, confrontation is done directly, victory is gained by surprise. [1:94]
Here Sun Tzu makes the point that the most visible or obvious engagement is not where war is actually won. In other words, the direct engagement is no more than a way of fixing the adversary's attention while the decisive engagement is concluded at a point where the enemy is weak-and not as well prepared. In other words, “Hit `em where they ain't.”
The O-O-D-A Loop
John Boyd, a retired Air Force colonel whose concept of destruction and creation we examined in the last installment, conceived a four-step prescription to guide the prosecution of military operations to swift, ultimate victory. Boyd called this prescription the O-O-D-A loop. And in the same way that Sun Tzu's principles are applicable to business operations, so too is Boyd's O-O-D-A loop. Moreover, the O-O-D-A loop provides highly focused guidance for effectively applying the specific Art of War principles cited above. It can be considered a command-and-control loop. [3:165]
“O-O-D -A” is an acronym that stands for observe, orient, decide, and act. These are sequential activities that guide leaders to effective decisions. The act step that culminates this process ultimately produces changes in the environment that merit a new, subsequent round of observations, followed by a second cycle of orientation, decision, and action. Boyd suggested that individuals or groups that could cycle through these four steps faster than their adversaries had a tactical advantage. To the extent that they could execute the cycle two or more times faster than their opponents could complete one, they would actually increase the opposition's confusion about the competitive situation to such a degree that the opponent's efforts might totally collapse. The accompanying figure provides a detailed picture of the O-O-D-A loop.
It's worth examining these steps in somewhat more detail. Observe
Observation, the first step in the O-O-D-A loop, is a search for information. The information that should be sought is, first and foremost, the nature of unfolding circumstances-the tactical situation. Only slightly less urgent is what Boyd called “outside information.” This could include the environment; the behavior and tendencies of oneself and one's opponents; the physical, mental, and moral situation; and potential
allies and other opponents. [4:62] It must be emphasized that this is not a passive step-it requires a concerted, active effort to seek out all the information possible, by whatever means available.
Moreover, bad news is the only kind that will do you any good. [4:63] What you're looking for—what you can best capitalize on—are data that don't fit with your current orientation, or worldview (and especially the worldview of your opponent). It is these “mismatches” that offer the potential for learning something that your adversaries don't know, thereby creating a tactical advantage that you can exploit. Orient
Orient is the “big O” in the O-O-D-A loop, as you can see from the complexity of that part of the illustration above. Notice that there are three arrows leading out of the orient block, but only one leading in, reinforcing the notion that our orientation to the world shapes the decisions we make, the actions we take, and what we choose to observe-what we look for-in the world around us.
Our orientation is a synthesis of multiple contributions, including cultural traditions, previous experiences, genetic heritage, and new information based on unfolding circumstances. These contributions are then analyzed and synthesized (remember the snowmobile analogy from the last installment?) into a new, updated picture of reality—a worldview. To the extent that a tactician or strategist is able to synthesize a more accurate picture of reality than his or her opponent, the quality of decisions and the effectiveness of actions improve, sometimes dramatically. To the extent that the tactician/strategist can deny that accurate picture to the adversary, the quality of the opponent's decisions and the effectiveness of his actions deteriorate. Boyd referred to this analysis-and-synthesis process as “many-sided, implicit cross-referencing.” [4:62]
It's orientation, however, that drives everything else. The faster we can orient ourselves, the greater the congruence with objective reality that we can make our orientation, the better and more effective our observations, decisions, and actions will be.
Decide
In concept, this is an explicit step, meaning a discrete, conscious activity following hard on orientation. However, Boyd also realized that intuitive understanding of the situation and one's own capabilities (the
fingerspitzengefühl discussed in our first installment) makes the decision step implicit, rather than
explicit. This is a highly desirable situation, because it speeds the cycle time of the O-O-D-A loop. As early as the 17th century, the quintessential samurai, Musashi, emphasized the need to practice
incessantly until this fingerspitzengefühl (not Musashi's word, obviously!) made the sword an extension of the warrior's arm and action instinctive, without having to think about it. In other words, implicit decision and action.
Act
The act step is largely self-evident. Action is the whole reason for going through the O-O-D steps in the first place. But it's crucial to keep in mind that the very action we attempt to execute will, itself, influence the environment in which we act. The environment will change, possibly only slightly, but more likely dramatically. This change in the “playing field” renders our orientation, or worldview, invalid to some degree: it introduces a mismatch between reality and our perception of it. The quicker we realize that this mismatch is developing, the sooner we can adjust our orientation to more closely approximate the new reality and act again. And this is the cyclic nature of the O-O-D-A loop.
Speed
A final word about speed. The more factors there are to consider, the more difficult it is to analyze and synthesize them all quickly. Knowing what to focus on and what can be ignored is crucial. Speed comes
from the implicit ability to do this, rather than from the explicit step. With experience and skill, an explicit decide step can be bypassed, and action becomes an implicit outcome of orientation, as Musashi intended. Moreover, the decision on what indicators to look for, or observe, in the external environment also becomes implicit (thus faster).
Conclusion
In the next installment, we'll see how the observe and orient steps constitute the heart of what Peter Senge has called learning organizations. And the following installment will introduce the concept of system constraints as a means of separating what's important to synthesize from what isn't in the mass of data that observation produces.
The one who figures on victory at headquarters even before doing battle is the one who has the most strategic factors on his side…The one with many strategic factors in his favor wins, the one with few strategic factors in his favor loses— how much more so for one with no strategic factors in his favor. Observing the matter in this way, I can see who will win and who will lose.
—Sun Tzu, The Art of War [1:56]
Endnotes
1. Sun Tzu. The Art of War (translated by Thomas Cleary). Boston, MA: Shambhala Publications, 1988. 2. McNeilly, Mark. Sun Tzu and the Art of Business: Six Strategic Principles for Managers. NY; Oxford University Press, 1996.
3. Hammond, Grant T. The Mind of War: John Boyd and American Security. Washington, D.C.: The Smithsonian Institution Press, 2001.
This is the fifth of a series of 12 articles on systems thinking, a way of understanding complex organizations and society offering significant promise for improving the leadership and management of
commercial companies, not-for-profit organizations, and government agencies. Part 5
The Learning Organization:
Adapt or Die!
H. William Dettmer
How can a team of committed managers with individual IQs above 120 have a collective IQ of 63?
—Peter Senge [7:9]
An interesting question Peter Senge poses. I've seen the phenomenon myself, and other prominent instances abound. For example, consider an excerpt from a recent article in USA Today about Delta Airlines:
On Monday [Delta] will launch an updated Delta.com [web]site that has streamlined features, including a focus on core consumer services such as booking trips, checking flight information, viewing itineraries, and monitoring frequent flier mileage..."This is our primary focus of our marketing for the second half of the year," chief marketing officer Paul Matsen said...The troubled airline hopes to cut costs by luring more travelers to its website—and away from its telephone reservations lines. [2]
If Delta is fishing for more customers, they're not using very persuasive bait. The day before, Delta's chief executive officer, Gerald Grinstein, warned employees that cost-cutting efforts so far are not enough to keep Delta out of bankruptcy. Wall Street was so thrilled at this news that Delta's shares immediately plummeted 26 percent. [1]
This isn't a unique situation. Delta has had hard times before. Other airlines (United comes to mind) have had worse. Still other airlines (Eastern, Braniff and Pan American) have even failed to survive. In other words, there is no shortage of lessons out there about how not to run an airline, and at least one example (Southwest) of how to do it right. As Yogi Berra once said, “You can observe a lot just by watching.” You'd think that airline executives would learn something. But apparently, you'd be wrong. As George Santayana once said, those who cannot learn from history are condemned to repeat it. (There's that word “learn” again!)
The Learning Organization
In The Fifth Discipline: The Art and Practice of the Learning Organization, Peter Senge defined a learning organization as one that is continually expanding its capacity to create its future. That's an intriguing definition, but one that says more about the outcome than the process.
Senge suggests that organizations aspiring to create their futures need to be able to learn in ways that Delta and the other airlines in financial trouble obviously haven't. The airlines are trying to survive. But
survival learning, also referred to as “adaptive learning,” while necessary, is reactive rather than
proactive. Creating futures requires what Senge calls generative learning--a horse of a distinctly different color.
According to Senge, a successful learning organization satisfies five indispensable criteria: [7:6-10] 1. It practices system thinking.
3. Employees and leaders alike have a shared mental model of the world—the organization, its markets and competitors, and environment.
4. Its leaders have a vision of where they want the organization to go. 5. Team learning is central to its activities and success.
Senge maintains that systems thinking and team learning are incomplete without shared vision, personal mastery, and mental models. I can't dispute that. But for the purposes of this discussion, we'll
acknowledge the importance of the middle three and focus on the first and last. Team Learning: What is it?
The concept of teams inherently assumes that the coordinated efforts of many are more effective than the isolated effort of any individual—or even a collection of individuals. Anyone who has listened to a good symphony orchestra or watched a world-championship sports team intuitively understands this.
Organizations are composed of teams. In small companies, a single team may be the organization. Larger organizations may be comprised of many discrete teams. Either way, the concept of “team learning” is somewhat of a non sequitur. Since team is an abstract classification of a group of individuals, it's a little difficult to understand how learning can occur at an abstract level. Individuals can learn, and if a group of individuals that don't constitute a team learns the same lesson, it's difficult to justify that “team learning” has occurred.
I submit that the concept of team is inherent in how its members operate and interact with one another, not in how they learn. Senge himself makes the following observation:
"Team building" exercises sent colleagues whitewater rafting together, but when they returned home, they still disagreed fundamentally about business problems. Companies pulled together during crises, and then lost all their inspiration when business improved. [7:15]
When individual faces on the team (or in the company) change, expertise—previous learning—is resident only in the remaining individuals, whether they are executives, managers, supervisors, or line employees, not in the team. Any learning subsequently transferred to new team members comes from individuals, not "the team."
Collective learning occurs at multiple hierarchical levels: individual, group, organizational, societal. With each increasing level of complexity, the challenge of learning (and institutionalizing that learning)
becomes more difficult. It requires more conscious, concerted effort, and sustainability at the organization level is uncertain at best.
This kind of learning is usually driven by one person (or a few committed individuals). Individual learning becomes team or organizational learning only when leaders institute a conscious effort—either by personal example or by directed policy—to seek out new information that could potentially change the nature of the operating environment, or the interactions of those who operate within it. In other words,
establishing effective organizational learning is a responsibility of leadership. Team Learning Versus Teamwork
The point here is that the operative word is “learning,” not “team.” The important activities associated with learning are capture, retention, recall, and application—in other words, how the learning is used to enhance teamwork. The distinction is important, because in the final analysis, all that is important from the team perspective is that team members recognize the need to aspire to learn (individually), to share what they've learned with other members of the team, and to internalize themselves the learning of others that is shared with them.
So, if learning occurs at the individual rather than at the team level, where does the “team” concept fit into the scheme of things? Effective teams are like well-oiled, finely-tuned machines. The various members work “seamlessly” with one another—virtually without friction. This doesn't happen naturally. It requires concerted effort and practice, practice, practice. In 1645 Miamoto Musashi, the prototypical
samurai warrior, wrote A Book of Five Rings in which he described what it took to become a samurai:
"Practice is the only way that you will ever come to understand what the Way of the warrior is about...Words can only bring you to the foot of the path." [5:94]
The team learning that Senge refers to [7:9] is not functional expertise. It's composed of two distinctly different domains: teamwork and systems thinking.
We've already touched on the idea of teamwork in this installment, and if you recall, we've seen it earlier, too, in the second installment, “Business and the Blitzkrieg.” Remember the essential tenets of the
blitzkrieg: Einheit (mutual trust), fingerspitzengefuhl ("fingertip feel"), auftragstaktik (moral contract),
and schwerpunkt (focus point)? [6:52-58] Trust and the moral contract are the bedrock upon which effective teamwork is built, and they must be learned. They may be introduced to individuals, but they can only be learned as a team.
What about fingertip feel and the focus point? The former is equivalent to Senge's criterion of personal mastery. And the focus point—schwerpunkt—requires a systems thinking perspective, another key Senge criterion.
Systems Thinking: The Key to Effective, Efficient Teamwork
Systems thinking must also be learned on an individual basis, but it must be applied by teams to be effective. Whether that team is a small, cohesive unit or a large organization, or even society as a whole, systems thinking is a team function in successful organizations. (Refer to the first installment, “Systems Thinking” for a more detailed review of systems thinking.)
How does one (or an organization) apply systems thinking? In the last installment, “Sun Tzu and the O-O-D-A Loop,” we examined the maneuver warfare philosophy of John Boyd and its elegantly simple expression, the O-O-D-A loop. [3:190] The O-O-D-A loop has direct impact on both individual and organizational learning.
Observation and Orientation
Recall that the first two O's in O-O-D-A stand for observe and orient. [3:163-164] Their relationship to organizational learning is crucial.
According to Boyd, the observation step is a process of gathering information, from both within and without. This information can come from a variety of sources: the media, research, direct observation, experimentation, or clandestine intelligence activity, to name just a few. What are the potential targets of these activities? Generally, they fall into three classifications: our own operations, the actions and activities of others (e.g., competitors), and the external environment (e.g., politics, economics, international developments, technology advances, catastrophic events, etc.).
Observation might be characterized as “situational awareness”—an aviation term that means paying attention to everything that's going on around you. But obviously at some point paying attention to everything indiscriminately can lead to sensory overload. Leaders and teams need a way of separating what's important from what isn't; otherwise, they can drown in data.
This is where orientation comes in. The orient step can be described as a process of interpretation and synthesis. (Refer to the third installment, "Analysis and Synthesis.") By analysis and synthesis, the
separation of the important from the trivial—and the integration of the important parts into a useful whole—takes place.
Boyd described orientation as one's "world view," or how we visualize what's going on around us. In other words, our understanding of the world, how it affects us, and how we affect it. To the extent that our perception of the world actually matches reality, we're confident in our ability to function effectively in it. To the extent that reality diverges from our view of how things are, or ought to be, we experience
difficulty and confusion, which normally show themselves as failures.
How do we come to our orientation (world view)? Boyd suggests that it's the integration of many factors: cultural traditions, previous experiences, our own analysis and syntheses, new information, and even our genetic heritage, from which we derive our psychophysical skills. [3:189]
The chief problem: people's world view becomes entrenched—static—while at the same time reality is
anything but static. To the extent that there is a mismatch between an organization's orientation and
reality, policies or practices based on that orientation become increasingly invalid or even irrelevant. Performance deteriorates and failures occur.
Such failures are hard to miss, even by busy leaders and manages. And naturally, they try to correct these problems. In other words, they react to a deteriorating situation. But inevitably, without a systems thinking perspective, these reactions are based on the aforementioned invalid policies or procedures—the result of an entrenched world view—so those reactions are often not effective. They may even exacerbate an already unfavorable situation. As reality diverges further from the organization's orientation, reactions become progressively less effective.
The Solution
The solution should be obvious: make a concerted effort to seek out new information (observe), then try to fit it into our world view, adjusting (orient) the world view as required to logically accommodate the new information. Done properly, effective orientation reduces the mismatch between perception and reality, pointing leaders toward revising policies and procedures that are more effective in the real, competitive world.
Richards points out that “since what you're looking for is mismatches, a general rule is that bad news is the only kind that will do you any good.” [5:63] What this means is that we must be actively gathering information, looking for mismatches between it and our orientation, and adjusting our world view, and the policies that spring from it—and do this faster than our competitors—in order to gain tactical or even strategic advantage. Thinking about all this "learning business," is it clear now how Delta, United, American, and the other airlines have failed to observe and orient properly?
So, how is your organization doing at learning?
You live and learn. Or you don't live long. —Lazarus Long [4] The ability to learn faster than your competitors may be the only sustainable competitive advantage.
—Arie de Geus [7:4] Endnotes
1. “CEO's cost-cutting memo sends stock into dive,” USA TODAY, Thursday, July 28, 2005, p. 3B. 2. “Delta hopes fliers will flock to new web site,” USA TODAY, Friday, July 29, 2005, p. 6B. 3. Hammond, Grant T. The Mind of War: John Boyd and American Security. Washington, D.C.:The
Smithsonian Institution Press, 2001.
4. Heinlein, Robert A. The Notebooks of Lazarus Long (illustrated by D.F. Vassallo). San Francisco: Pomegranate Artbooks, 1995.
5. Musashi, Miamoto. A Book of Five Rings (Victor Harris translation). London: Allison and Busby, 1974.
6. Richards, Chet. Certain to Win:The Strategy of John Boyd Applied to Business. Xlibris Corporation, 2004.
7. Senge, Peter. The Fifth Discipline: The Art and Practice of the Learning Organization. NY: Doubleday, 1990.
This is the sixth of a series of 12 articles on systems thinking, a way of understanding complex organizations and society offering significant promise for improving the leadership and management of
commercial companies, not-for-profit organizations, and government agencies. Part 6
Systems and Constraints: The Concept of Leverage
By H. William Dettmer
Give me a lever long enough and a place to stand, and I can move the world. —Archimedes, 287-212 BC
If he didn't actually discover it, Archimedes certainly popularized the concept of leverage. In the third century BC, he designed war machines exploiting the lever for the armies of Greece in their pursuit of empire in the Mediterranean. As the quotation above implies, an understanding of leverage can enable one to apply force to something far out of proportion to one's individual strength.
The concept of leverage applies to systems, too—particularly to organizational systems. But before we see how, let's revisit the concept of a system.
Deming characterized a system as a network of interdependent components that work together to
accomplish the aim of the system. [1:50] As soon as we acknowledge the idea that a system is composed of multiple component parts, a question immediately arises: Are all the components equally important, or are some more instrumental than others in striving for the goal of the system? In most organizations, people act as if all components are equivalent. For example, everybody is considered an "equal member of the team." But is this really the case? Does every component contribute equally to the system's success? As George Orwell observed in his classic allegorical novel, Animal Farm, "all animals are equal—but some are more equal than others." [5:Ch.10]
The Pareto Principle
In 1906, Vilifredo Pareto, an Italian economist, observed that 80 percent of Italy's wealth was owned by 20 percent of its population. [6] In the 1930s, Joseph Juran observed a similar relationship—what he referred to as "the vital few versus the trivial many." Though he didn't cite Pareto in particular, his observation of the "80/20 rule"—meaning 20 percent of a system is responsible for 80 percent of its results—became known as Pareto's Principle. Howard Gardner uses the Pareto Principle as a teaching example, and in the process, he points out that "it is important to be judicious about where one places one's efforts..." [2:9]
The wisdom of the Pareto Rule is generally accepted. What is less commonly understood is the key underlying assumption behind it, which Gardner hinted at and Orwell said somewhat more explicitly: not all of the system's components are equally important in achieving its goal.
The Concept of a System Constraint
All systems, whether open or closed, are limited (or constrained) in some way. Organizational systems are no exception. What, exactly, is a system constraint? It's some factor that limits what the system can achieve. Were it not for this limiting factor, the rest of the system might be able to achieve much more in realizing its goal. The limiting factor may be internal or external to the system. It may be a physical component, a condition, or an imposed policy of some kind. Whatever it is, however, it does frustrate efforts from within the system to achieve better performance.
