Systems Thinking (eBook)

Front Cover 1
Systems Thinking: Managing Chaos and Complexity: A Platform for Designing Business Architecture 3
Copyright 5
Contents 6
Foreword to the Third Edition 12
Foreword to the Second Edition 18
Preface 20
Acknowledgment 22
Part One: System Philosophy: The Name of the Devil 24
Chapter 1: How the GameIs Evolving 26
1.1 Imitation 27
1.2 Inertia 28
1.3 Suboptimization 29
1.4 Change of the game 29
1.5 Shift of paradigm 31
1.6 Interdependency and choice 32
1.6.1 On the Nature of Organization: The First Paradigm Shift 32
1.7 On the nature of inquiry 36
1.7.1 The Second Paradigm Shift 36
1.8 The competitive games 40
1.8.1 Mass Production — Interchangeability of Parts and Labor 40
1.8.2 Divisional Structure — Managing Growth and Diversity 41
1.8.3 Participative Management 43
1.8.4 Operations Research — Joint Optimization 44
1.8.5 Lean Production System — Flexibility and Control 45
1.8.6 Interactive Management — Design Approach 45
Part Two: Systems Theory: The Nature of the Beast 48
Chapter 2: Systems Principles 52
2.1 Openness 52
2.2 Purposefulness 56
2.2.1 Recap 60
2.3 Multidimensionality 61
2.3.1 Plurality of Function, Structure, and Process 65
2.3.2 Recap 67
2.4 Emergent Property 68
2.4.1 Recap 70
2.5 Counterintuitive Behavior 71
2.5.1 Recap 77
Chapter 3: Sociocultural System 80
3.1 Self-organizatioN: movement toward a ?predefined order 80
3.2 Information-bonded systems 82
3.3 Culture 83
3.4 Social learning 85
3.5 Culture as an operating system 87
Chapter 4: Development 92
4.1 Schematic view of theoretical traditions 93
4.2 Systems view of development 96
4.3 Obstruction to development 100
4.3.1 Alienation 101
4.3.2 Polarization 102
4.3.3 Corruption 104
4.3.4 Terrorism 105
4.3.5 Recap 108
Part Three: Systems Methodology: The Logic of the Madness 110
Chapter 5: Holistic Thinking 112
5.1 Iterative process of inquiry 112
5.2 Systems dimensions 116
5.2.1 Generation and Dissemination of Wealth 119
5.2.2 Generation and Dissemination of Power ( Centralization and Decentralization Happen at the Same Time) 120
5.2.3 Generation and Dissemination of Beauty: Social Integration 124
5.2.4 Generation and Dissemination of Knowledge 126
5.2.5 Generation and Dissemination of the Value: Conflict Management 127
Chapter 6: Operational Thinking: Dynamic Systems: Dealingwith Chaos and Complexity 132
6.1 Complexity 133
6.1.1 Open Loop and Closed Loop Systems 134
6.1.2 Linear and Nonlinear Systems 134
6.2 Operational thinking, the iThink language 142
6.2.1 Connectors 143
6.2.2 Modeling Interdependency 144
6.3 Dynamics of throughput systems 147
6.3.1 Critical Properties of the Process 149
6.3.2 Model of the Process 149
6.3.3 Measurement and Learning 153
Chapter 7: Design Thinking 156
7.1 Design thinking, as the systems methodology 157
7.2 Operating principles of design thinking 160
7.3 Modular design 161
7.4 Design and process of social change 164
7.5 Interactive design 165
7.5.1 Idealization 167
7.5.2 Realization — Successive Approximation 170
7.5.3 Dissolving the Second-Order Machine 173
7.6 Critical design elements 173
7.6.1 Measurement and Reward System (A Social Calculus) 173
7.6.2 Vertical Compatibility 174
7.6.3 Horizontal Compatibility 176
7.6.4 Temporal Compatibility 178
7.6.5 Target Costing 179
Chapter 8: Formulating the Mess 182
8.1 Searching 183
8.1.1 Systems Analysis 184
8.1.2 Obstruction Analysis 184
8.1.3 System Dynamics 184
8.2 Mapping the Mess 186
8.3 Telling the Story 189
8.3.1 Formulating the Mess: A Case Review (Story of Utility Industry) 189
8.3.2 Success Changes the Game, Lack of Explicit Vision 192
8.3.3 Monopolistic, Cost Plus, Regulated Environment 193
8.3.4 The Non-Competitive Culture 194
8.3.5 The Input-Based Personnel Policy 195
8.3.6 Mediocrity, Tolerance of Incompetence 196
8.3.7 Structural Incompatibility 197
8.3.8 Uncertainty About the Future 199
8.4 The Present Mess 200
8.4.1 Drivers Defining the Behavior of the Present State of the Economy 200
8.4.2 How the Game Is Evolving 200
8.5 Current Crisis and Future Challenges 201
Chapter 9: Business Architecture 204
9.1 The system's boundary and business environment 205
9.2 Purpose 207
9.3 Functions 212
9.4 Structure 213
9.4.1 Output Dimension 215
9.4.2 Input Dimension 217
9.4.3 Market Dimension 219
9.4.4 Internal Market Economy 220
9.5 Processes 224
9.5.1 Planning, Learning, and Control System 225
9.5.2 Measurement System 225
9.5.3 Recap 230
Part Four: Systems Practice: The Gutsy Few 232
Chapter 10: The Oneida Nation 234
10.1 Desired specifications 234
10.2 Systems architecture 236
10.3 Governance 237
10.3.1 Governing Body 238
10.3.2 Chief of Staff 238
10.3.3 Planning, Learning, and Control System 239
10.3.4 Planning, Learning, and Control Board 240
10.4 Membership systems 241
10.4.1 Empowerment 241
10.4.2 The Tie That Bonds 242
10.4.3 Membership Network 243
10.4.4 Consensus-Building Process 244
10.4.5 Back to the Future 247
10.4.6 Performance Criteria and Measures 248
10.5 Learning systems 249
10.5.1 Learning to Learn (Formal Education) 250
10.5.2 Learning to Be (Cultural Education) 251
10.5.3 Learning to Do (Professional Education) 252
10.5.4 Support Functions 252
10.5.5 Advocacy Functions 253
10.5.6 Oneida Multiversity 253
10.5.7 Performance Criteria and Measures 255
10.6 Business systems 256
10.6.1 Services Sector 257
10.6.2 Industry Sector 258
10.6.3 Leisure Sector 258
10.6.4 Land and Agriculture Sector 258
10.6.5 Marketing Sector 259
10.6.6 Governance and Intersystem Relationships 259
10.7 Core services 260
10.7.1 Government Services Division 260
10.7.2 Infrastructure Development Division 261
10.7.3 Ordinance Division 261
10.7.4 Performance Criteria and Measures 261
10.7.5 Governance and Oversight 261
10.8 External environment 262
10.9 Judicial system 263
10.9.1 Contextual Analysis 263
10.9.2 Contextual Challenge 264
10.9.3 Democratic Challenge 265
Chapter 11: Butterworth Health System 268
11.1 Issues, concerns, and expectations 269
11.2 Design specifications 271
11.3 The Architecture 272
11.4 Market dimension 273
11.4.1 Market Access 273
11.5 Care System 274
11.5.1 Contextual Background 274
11.5.2 Desired Specifications 275
11.5.3 Common Features 276
11.5.4 Preventive Care 278
11.5.5 Interventional Care 279
11.5.6 Viability Care 280
11.5.7 Terminal Care 281
11.6 Output dimension 281
11.6.1 Alternative One: Traditional Functional Structure 282
11.6.2 Alternative Two: Modular Structure 282
11.6.3 Health Delivery System Design: The Makeup 284
11.6.4 Community-Based Health Delivery System 284
11.6.5 Specialized Health Delivery System 286
11.6.6 Shared Services 287
11.7 Core knowledge 288
11.8 Shared services 293
11.8.1 Need for Centralization 293
11.8.2 Control Versus Service 294
11.8.3 Customer Orientation 295
11.9 Health delivery system, core knowledge, and care system interactions 296
11.10 The executive office 300
11.11 Recap 301
Chapter 12: The Marriott Corporation 304
12.1 The environment: how the game is evolving 305
12.1.1 Bases for Competition 305
12.2 Purpose 305
12.2.1 Principles and Desired Characteristics 305
12.2.2 Mission 306
12.3 The architecture 306
12.3.1 Product/Market Mix 308
12.3.2 Region/Market Operation 308
12.3.3 Brand Management 309
12.3.4 Core Components 310
12.3.5 Core Knowledge 310
12.3.6 Critical Processes 311
12.4 Recap 312
Chapter 13: Commonwealth Energy System 314
13.1 Stakeholders' Expectations 315
13.1.1 Shareholders' Expectations 315
13.1.2 Regulators' Expectations 316
13.1.3 Employees' Expectations 316
13.1.4 Customers' Expectations 316
13.1.5 Suppliers' Expectations 317
13.1.6 Public's Expectations 317
13.2 Business Environment 317
13.2.1 The Changing Game: The Energy Industry 317
13.2.2 The Changing Game: COM/Energy 319
13.3 Design 319
13.3.1 Purpose and Strategic Intent 320
13.3.2 Core Values and Desired Specifications 321
13.4 General Architecture 322
13.5 Core Business Units: Gas and Electricity Distribution 324
13.5.1 Customer-Oriented Business Units: Energy ?Supply Systems and Management Services 325
13.5.2 Cogeneration and Packages of Energy ?Supply (Industrial and Commercial) 325
13.5.3 Energy Efficiency and Electrotechnologies (Residential and Commercial) 327
13.6 Technology/Supply-Oriented Business Units: Energy Generation and Supply 328
13.6.1 Energy Generation (Canal) 329
13.6.2 Gas Storage (LNG) 330
13.6.3 Steam Services 330
13.7 Energy Brokerage and International Operations 330
13.7.1 Energy Brokerage 331
13.7.2 International Operations 331
13.8 Shared Services (Performance Centers) 332
13.8.1 Service Company 333
13.8.2 Financial Systems 334
13.9 Executive Office 334
13.9.1 Core Knowledge Pool 335
13.9.2 Learning and Control System 336
Chapter 14: Carrier Corporation 340
14.1 Expectations, assumptions, and specifications 341
14.1.1 The Changing Game: In General 341
14.1.2 The Changing Game: The HVAC Industry 342
14.1.3 Drivers for Change 342
14.1.4 Bases for Competition 342
14.2 Core Values 342
14.2.1 Products and Services 343
14.2.2 Core Technology and Know-How 344
14.2.3 Sales and Distribution System 345
14.3 Systems Architecture 346
14.3.1 Desired Characteristics 346
14.3.2 A Multidimensional Framework 346
14.4 Markets 347
14.4.1 Regional Units 347
14.4.2 Area Units 349
14.5 Output units 349
14.6 Components 350
14.7 Inputs 351
14.7.1 The Technology 351
14.7.2 Operational Support (Process Design) 352
14.7.3 Management Support Services 353
14.8 Business Processes 353
14.8.1 Decision System 353
14.8.2 Performance Measurement and Reward System 354
14.8.3 Target Costing and Variable Budgeting System 354
Author Biography 356
Conclusion 358
References 362
Index 366