Question 28
of 100
When we want a different
result, we change the system.
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Information is presented under the following
headings.
Why this question is important
A systems view
Senge's system laws
Reactive decisions
Who is making these decisions?
Systems thinking characteristics
Process management and improvement
– in summary
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Avoid doing these poor practices
A work harder approach. Shows no understanding that improved
performance can only result from an improved system and process.
Large amounts of energy expended to `beat the system'.
People feel like they are helpless against the `system'. `The
system' is anonymous and undefined.
People engaged in mindless work - the purpose of which they
don't understand and whose outcome and process they can't control.
No process of company self-development.
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Do these good practices
Understanding that for output to be improved the system must
be improved.
Constant work to improve process capability to meet customer
needs. "Fix the system to please the customer"
Measurement and process thinking is well developed or deployed.
Recognizing the value of innovation for the vitality it brings
to the drab reliability push - and the police state that is
its natural consequence.
Senior executives have created an atmosphere that accepts and
welcomes innovative change that benefits the customer and the
company and makes processes easier and simpler to use or with
less variation in their output.
People view process management and improvement as a natural
part of their daily work. Staff are involved in continuous improvement.
Continuous practice of effective change management. Continual
search for best or better fit.
Process improvement process incorporates creative problem solving
processes.
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Principle 4 - To improve the outcome, improve the system (Item 4)
In order to improve the outcome; improve the system and its associated
processes.
Corollary: All people work in a system: outcomes are improved when
people work on improving the system
When you want a different result, you must change the
system.
All systems deliver exactly what they are designed
to deliver. If you want a new outcome, you have to change the process.
If you do not, the outcome will probably stay the same. Working harder
does not work. The 'system' in made up of many interconnections and
interdependencies.
Companies must use their internal systems and business processes to
respond to the needs of their influential stakeholders. Complexity arises
because of interdependencies and interconnectedness of processes and
activities within the company as well as external forces and process
acting on the company. From a systems perspective, nothing in the company
can be thought of as isolated. Therefore, no intervention is totally
discrete.
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Senge, the guru of systems thinking,
proposed a set of laws that he considers apply when problems
are resolved at an inappropriate level of complexity:
- Today's problems come from yesterday's
solutions.
- The harder you push, the harder
the system pushes back.
- Behavior grows better before it
grows worse.
- The easy way out usually leads back
in.
- The cure can be worse than the disease.
- Faster is slower.
- Cause and effect are not closely
related in time and space.
- Small changes can produce big results
- but the areas of greatest advantage are often the least
obvious.
- Dividing an elephant in half does
not produce two small elephants.
- There is no blame.
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In the old thinking, people made their decisions in reaction to what
is happening around them. Such event driven actions are characterized
by:
- Analysis does not consider the system, its complexity or interactions
— or how people will react
- Analyses and decisions are based on old data and information
- `Gut-feel' is used instead of data
- Analysis is superficial
- Power and authority dominate decision making
- Little time for diagnosis
- Poor quantification of resource requirements
- Targets are assigned without knowledge of the systems capability
to produce them and subsequently plans are not made to modify/improve/change
the system so the targets can be reached
- Little consultation with concerned parties
- Poor identification of potential consequences on other parts of
the systems or to other stakeholders (suppliers, customers, community,
innocent bystanders).
- Poor identification of risks or barriers
Event-based, reactive decisions are unlikely to result in system level
improvement.
Event driven improvements fail to consider the effect of the improvement
on the system as a whole and can subsequently undermine your ability
to reach your objectives.
The negative effects that the `improvement' has on other parts of the
system is ignored or thought to be bad luck. For example:
Manager: We have been having major problems achieving our monthly
production targets over the past six months. Last month, my boss really
got stuck into me over falling behind the target. This month, I've instructed
our warehousing people to ensure the full delivery targets are achieved,
irrespective of the stocks in our local distribution stores.
Warehouse Supervisor: I'm going to need to work additional overtime
to get all of the material delivered this month. I'll be in difficulty
over that. I wish the manager had talked this decision through with
me.
Local Store Supervisor: Where am I going to put all that stock?
I need to hire some additional space. That's going to be expensive!
Accountant: Our cost of inventory and overtime are becoming excessive.
Who is making these decisions?
System level improvement requires an understanding of the system and
its interdependencies. The nature of the relationships determines both
the outcomes and the unintended consequences. This approach to improvement
– the new thinking – is characterized by:
- Data on which the analysis is based is historically relevant
- Analysis is in-depth; at a dynamic level of complexity
- Several models in decision making
- Appropriate time for diagnosis
- Sound quantification of resource requirements
- Considered targets
- Appropriate consultation with concerned parties
- Sound identification of potential consequences.
You can probably see very good relationships between these factors
and Senge's laws. These issues are discussed throughout each of the
Principles.
A structured approach to managing and improving the operational efficiency
and effectiveness of business processes would include the following:
- identification and ownership – you should identify,
map and manage your core, support processes and operational processes.
Responsibility for the management of these should be assigned.
- customers of the process – you should identify your
internal customers of your processes, identify their needs and expectations
and ensure adequate feedback in customer/supplier relationships for
the requirements of all customers of the process to be met
- measurements and targets – you should set present and
future targets for process performance levels; measure process performance
and capability and use in-process and outcome indicators to measuring
effectiveness and efficiency
- people participation – you should encourage and enable
your people (provide with adequate skills, knowledge, resources and
authority) to understand the processes with which they work, bring
people at all levels together to understand the systems within which
the processes sit in order to control and improve them. Managers must
work to improve processes
- process improvement – you should establish techniques
to understand the stability and capability of processes; systematically
improve processes through innovation (Principle 8) and reduction of
variation (Principle 6), e.g. performance gap analysis, determine
root causes, re-engineering, eliminate special cause variation and
reduce common cause variation etc
- process execution – you should standardize processes
in order to ensure a high level of confidence that output requirements
and customers' expectations are consistently met
- compliance with standards – you should integrate compliance
to relevant standards into the broader process management system
- comparisons and benchmarking – you should learn from
others, ways to increase speed and effectiveness of the way you improve
your processes, products and services. You should use this information
to improve the way you do things.
Footnotes
This material comes from training
material prepared and used by the Australian Quality Council.
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