Article: Building an organisation: Learning from Systems Thinking


Building an organisation: Learning from Systems Thinking

An organization is a system comprising of individuals working towards a common goal. Therefore, it is only natural that we can apply some of the principles of systems thinking.
Building an organisation: Learning from Systems Thinking

Having worked with multiple Business Leaders to help build an effective organization, I cannot help but marvel at the amazing power of 'Systems Thinking'. An organization is a system comprising of individuals working towards a common goal. Therefore, it is only natural that we can apply some of the principles of ‘systems thinking’. This always serves as a good non-technical way of stress testing your organization structure. The conversation it generates is extremely valuable for ‘making the right choice’.

1. Today's problems came from yesterday's solutions. Similarly, today's solutions will create tomorrow's problems. Do we know what those are?

There is usually an ‘aha’ moment followed by a long pause and silence when I pose this question. Everyone has been so focused on today’s problems and therefore the new structure proposal, that it becomes almost a ‘U’ turn to have them think about what problems will we have tomorrow. What follows next is a brilliant dialogue on ‘what will tell us when our org structure is failing us’.

2. The easy way out usually leads back in. The highest leverage point is often least obvious. Don't jump on the 'first available' solution.

Creating an org structure that supports your strategy has long range impact. It is a significant change and people often do not realize the impact a structure change in one part of the organization can cause in the overall organization’s operating model. E.g. If the sales team suddenly decides to focus on ‘customer experience’ and organize themselves to meet each customer’s unique needs, it throws the ‘built for scale and efficiency’ structure of Operations and Supply Management units. So while changing a sales structure to quickly address customer issues is a perceived ‘quick fix’ it causes disturbances in other related functions. It creates more problems than solving them if these linkages are not understood. The classic ‘5 why’ questioning framework works brilliantly to peel the layers of complexity driving the need for a change. So take a pause and just ask ‘what this might impact’ before you implement the new seemingly simple structure change. It may not solve a collective problem.

3. Cause and effect are not closely related in time and space. Remember to check for connection points across related and interlocked systems.

This is one thing that Leaders need to deliberately practice. There is always a pressure to ‘deliver quickly’. People want to see immediate impact and change in behavior. However, change is hard and it takes its due time before you get results. Because the results are not instantaneous, Leaders need to exercise patience and persistence. It will be some time before the results show up. Avoid the tendency for ‘additional interventions’ because you do not see immediate results.

4. Don't blindly apply old system assumptions to a new one.

Cutting an elephant in half does not give you two elephants. Anytime you combine or divide a system, you get a 'new' system with its unique characteristics. Don't blindly apply old system assumptions to a new one. We all love models because they help us make sense of the world. Once something works for us, we tend to stick to it and keep going back to it when in crisis. It applies to ‘the way we operate’. Any time we break and combine something, we tend to apply our old ‘what worked for me’. This causes us to overlook new insights or land in same old problems. Combining product lines or creating separate centers of excellence usually needs an accompanying change in ‘how we operate’. However, not everyone spends time thinking through it. We continue to what we always did and not even realize we are doing it.  

5. Put the expiry date and expiry conditions on the new system on the day of launch.

It helps to be clear about how we are defining "effectiveness". Remember, no structure is permanent and none is perfect. They all serve a specific purpose. Changing an org structure is hard and painful because of the emotions it generates. Hence it is best to think about the end when you are starting. It creates a solid basis for the ‘case to change’ in future.

Building an organization is an art and science. It gets better with practice. However, the opportunities to practice in the real world are too few and often come with high stakes. So, preparing in advance through 'scenario planning' may not be a bad idea. Give it a try...

(Views expressed herein are those of the author and do not represent any organization or association.)

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Topics: Culture, Employee Relations, Performance Management

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