This week you will participate in the learning activity listed below as part of your ongoing development in Strategic Leadership.

Following the reading/instruction/direction contained in each Learning Activity adds to your proficiency in Strategic Leadership and skill development for adding to your knowledge base, completion of assignments and development of PressBooks materials throughout this course. This is the same requirement for each Learning Activity throughout the coursework.

Systems Thinking

A Systems Thinking Primer: Seeing Organizations in Action

Five Disciplines of a Learning Organization – Peter Senge

See Senge’s Five Disciplines of Learning Organizations for an effective summary of this seminal book related to Systems Thinking.

Stephen Haines writes that a system is “a set of components that work together for the overall objective of the whole.” (p. 17)

In Senge’s The Fifth Discipline, Senge outlines his fundamentals (Laws) for systems thinking.

Today’s problems come from yesterday’s solutions.

Senge notes, ‘we merely need to look at our own solutions to other problems in the past.’ (p. 57)

Explaining that problems arise from past actions.

A well-established firm may find that this quarter’s sales are off sharply. Why? Because the highly successful rebate program last quarter led many customers to buy then rather than now. Or a new manager attacks chronically high inventory costs and “solves” the problem—except that the salesforce is now spending 20 percent more time responding to angry complaints from customers who are still waiting for late shipments, and the rest of its time trying to convince prospective customers that they can have “any color they want so long as it’s black. (Senge. pp. 57, 58)

The harder you push, the harder the systems push back.

Compensating feedback is when well-intentioned interventions offset the benefits of the intervention (p. 58). Senge provides an example of this when he writes:

efforts to correct the U.S. trade imbalance by letting the value of the dollar fall in the mid-1980s were compensated for by foreign competitors who let prices of their goods fall in parallel (for countries whose currency was “pegged to the dollar,” their prices adjusted automatically) (p.59).

In a similar fashion, the attempt to address homelessness in Canada created an industry requiring people to be homeless for them to survive as organizations. If homelessness is reduced or eliminated, hundreds of people in every province will be out of jobs as a result of solving homelessness. This in turn may create a whole new wave of homelessness as the unemployed caregivers become unable to pay their bills or meet their financial; obligations caused by the reduction or eradication of homelessness.

Behavior grows better before it grows worse.

As in the illustration regarding solving homelessness, things do get better than worse; in the short term. But like a giant game of JENGA where pieces are stacked successfully, the organizational successes quickly erode or are replaced due to reorganization of funds. Soon enough of the original foundational idea is gone and the entire structure begins to topple, requiring other supports to prop it up. “The better before worse response to many management interventions is what makes political decision making so counterproductive.” (Senge p. 60)

The easy way out usually leads back in.

“Pushing harder and harder on familiar solutions, while fundamental problems persist or worsen, is a reliable indicator of nonsystemic thinking.” (Senge, p. 61) We need to look beyond the comfortable and familiar and push on into finding solutions in areas where we are unfamiliar, but might have an answer we had not considered previously.

The cure can be worse than the disease.

“The long – term, most insidious consequence of applying nonsystemic solutions is increased need for more and more of the solution.” (Senge, p. 61)

The old saying about everything being a nail if you’re a hammer applies here. Your solution becomes one size fits all. The solution becomes so predictable everyone in the organization makes it their go to whenever a challenge arises requiring attention. Senge suggests every truly healthy organization requires everyone to shoulder their own burdens (p. 62), take responsibility for finding the best solutions for the challenges before them.
A sentiment repeated in Galatians 6:4, 5 in the Bible.

4 Each one should test their own actions. Then they can take pride in themselves alone, without comparing themselves to someone else, 5 for each one should carry their own load (Galatians 6: 4, 5 NIV).

Faster is slower.

When growth becomes excessive … the system itself will seek to compensate by slowing down; perhaps putting the organization’s survival at risk in the process. (Senge, p. 62)

Taking the time in process, with well thought out answers to the organizational challenges experienced will help curtail excessive growth that can hinder the anticipated progress of the organization. We’ve seen many organizations experience growth and rapid success, only to fail shortly afterward because their success did not anticipate the effects growth would have on the organization as a whole.

Target Canada is a perfect example of the law of ‘faster is slower.’ They entered the Canadian market after the highly successful growth and brand adoption in the US. The expansion was based primarily on the US growth success. As a result of poor planning, taking on too much too soon, poor supply chain issues to support their expansion, Target soon closed their doors in Canada less than two years after opening a massive number of stores to amazing fanfare. (St. Louis, January 30, 2015)

The company assumed it could coast on its reputation, but its actions in the early stages of the expansion suggests it didn’t understand why Canadian customers loved Target’s U.S. stores. (St. Louis, January 30, 2015)

Cause and effect are not closely related in time and space

Underlying all of the above problems is a fundamental characteristic of complex human systems: “cause” and “effect” are not close in time and space. By “effects,” I mean the obvious symptoms that indicate that there are problems—drug abuse, unemployment, starving children, falling orders, and sagging profits. By “cause” I mean the interaction of the underlying system that is most responsible for generating the symptoms, and which, if recognized, could lead to changes producing lasting improvement. Why is this a problem? Because most of us assume they are — most of us assume, most of the time, that cause and effect are close in time and space. (Senge, p. 63)

What Senge is getting at is that cause and effect can occur between great distances of time and across great distances. The Butterfly Effect, made popular by movies, is part of the chaos theory.
The chaos theory is part of:

a scientific field blending mathematics, statistics, and philosophy that was developed to study systems that are highly complex, unstable, and resistant to exact prediction. Chaotic systems include weather patterns, neural networks, some social systems, and a variety of chemical and quantum phenomena. The study of chaotic systems began in the nineteenth century and developed into a distinct field during the 1980s. (Chaotic Systems, 2013)

Small changes in initial conditions lead to drastic changes in results. (Fractal Foundation) What gets set in motion today, may not effect the organization for years to come. What started as a small imperfection in Europe can cost thousands of dollars in remanufacturing costs in North America. The key component to watching and monitoring cause and effect is diligence. Pay attention to the sources and results of all products and systems to determine their effect elsewhere.

Small changes can produce large results — but the areas of highest leverage are often the least obvious.

Tackling a difficult problem is often a matter of seeing where the high leverage lies, a change which — with a minimum of effort — would lead to lasting, significant improvement. (Senge. p. 64)

Senge uses an illustration from Buckminster Fuller regarding the ‘trim tab’:

The trim tab — this very small device that has an enormous effect on the huge ship — does the same for the rudder. When it is turned to one side or the other, it compresses the water flowing around the rudder and creates a small pressure differential that “sucks the rudder” in the desired direction. But, if you want the rudder to turn to the left, what direction do you turn the trim tab? — to the right, naturally.

The entire system — the ship, the rudder, and the trim tab — is marvellously engineered through the principle of leverage. Yet, its functioning is totally nonobvious if you do not understand the force of hydrodynamics.

So, too, are the high – leverage changes in human systems nonobvious until we understand the forces at play in those systems. (Senge, p. 65)

The bible speaks of another small high leverage device that creates high leverage changes; the tongue. Whether expressed directly or through written mediums like email or social media, the tongue can introduce small changes to personal or organizational perspectives that can affect/effect the entire outcome of corporate or personal relations; positively or negatively. (James 3: 3-6)

It is therefore important to realize, every word spoken or written, every plan made, every communication released and every explanation given, must be carefully reviewed before being released for public dissemination. – The smallest changes can produce large results; to the positive or negative.

You can have your cake and eat it too but not all at once.

American manufacturers thought they had to choose between low cost and high quality. “Higher quality products cost more to manufacture,” they thought. “They take longer to assemble, require more expensive materials and components, and entail more extensive quality controls.” What they didn’t consider was all the ways the increasing quality and lowering costs could go hand in hand, over time. What they didn’t consider was how basic improvements in work processes could eliminate rework, eliminate quality inspectors, reduce customer complaints, lower warranty costs, increase customer loyalty, and reduce advertising and sales promotion costs. They didn’t realize that they could have both goals, if they were willing to wait for one while they focused on the other. Investing time and money to develop new skills and methods of assembly, including new methods for involving everyone responsible for improving quality, is an up front “cost.” Quality and costs may both go up in the ensuing months; although some cost savings (like reduced rework) may be achieved fairly quickly, the full range of cost savings may take several years to harvest. (Senge, p. 65)

There is nothing wrong with success, but don’t expect immediate results in everything you do. Some things take time and others tale less time while others take more time still. This is the place for dreamers to pause. Look at the long game and determine the results over increments of time in months, years and decades. Too much too soon can set an organization up for failing in their markets because they lose sight of the long term ends they hope to achieve. Pacing the results and returns into realistic reports and responsible projections can help organizations see the both/and nature of their business and reap the benefits as they prepare to eat their cake, one bite at a time.

Dividing an elephant in half does not produce two small elephants.

Seeing “whole elephants” does not mean that every organizational issue can be understood only by looking at the entire organization. Some issues can be understood only by looking at how major functions such as manufacturing, marketing, and research interact; but there are other issues where critical systemic forces arise within a given functional area; and others where the dynamics of an entire industry must be considered. The key principle, called the “principle of the system boundary,” is that the interactions that must be examined are those most important to the issue at hand, regardless of parochial organizational boundaries. (Senge, p. 65)

There are many issues and challenges facing an organization that do not require the attention of the whole. Enaggaing other aspects or interactive parts of the organization in isolation can help reviewers understand the issues affecting the greater whole. There is little need to engage every level, every department, when focusing on the interactive areas within the organization may bring the result desired. It is still part of the elephant; yes. But you don’t need to involve the legs, back and tail to feed it and ensure its nutritional health.

There is no blame.

We tend to blame outside circumstances for our problems. “Someone else”—the competitors, the press, the changing mood of the marketplace, the government—did it to us. Systems think that there is no outside; that you and the cause of your problems are part of a single system. The cure lies in your relationship with your “enemy.” (Senge, p. 65)

Take responsibility for your actions. Take responsibility for the risks you take. Fail; try again. Fail again; try again and again. You and your thinking are your greatest asset and your greatest enemy. Too often we look for scapegoats to take the blame and blame shift our responsibility to find others responsible for our failings and conversely for our success. Blame works both ways.

Stepping up and taking responsibility for the things going well requires us to stand up and take responsibility for those things that don’t go so well. In the sense that when failing belongs to us so does success. Look in the mirror, take responsibility, be the leader you need to be at the time you need to be.

5 more laws to consider – just to expand the thought.

Now that we’ve reviewed Senge’s laws, here are 5 more:

Systems cannot be fully perceived with one set of eyes.

As the old African proverb states, ‘it takes a village to raise a child,’ so to does it take a team of people to understand and address the systems within an organization. In education, we have moved from the ‘sage on the stage’ where the professor was the all knowing expert waiting to dispense wisdom to all enrolled. Education, like many systems seeks collaborative learning from all engaged in the process; from learner to leader.

No ones work is performed in isolation.

Whether it is science fiction, faith or being part of an organization, the truth is out there. We are not alone. And being that we are not alone, we should not believe we are alone in any challenge we face in the learning organizations we call home. Nothing we do is in isolation, unless we choose to isolate ourselves and be alone in our decision making or the challenges we face. Utilize the team, bring everyone together, review collectively and by all means make problem solving the group activity it is meant to be.

If you put a system under pressure long enough it can suddenly collapse.

All systems work similarly. Organizational systems have clear lines of operation and responsibility. To that end, if the systems experience challenges or are overloaded in the process, it takes specific and directive action by those familiar with the systems under pressure to salvage the system due to excessive pressure applied to the various systems needed for effective operation.

When equipment fails due to being under pressure for a long period of time, it is important the cause is correctly identified so corrective steps can prevent recurrence. An incorrect diagnosis of a failure can lead to improper corrective measures; thus, problems continue.

General Electric (GE) describes the process for boiler failures this way:

When equipment failures do occur, it is important that the cause of the problem be correctly identified so that proper corrective steps can be taken to prevent a recurrence. An incorrect diagnosis of a failure can lead to improper corrective measures; thus, problems continue. (GE)

Use the system within the limits it was intended for. Add pressure to the systems so the system can adjust to the extra stressors placed on it and proceed with caution to accomplish the goals with the system as it was designed, not what was hoped it would handle.

Systems can suddenly change if you find the right combination of actions.

Just because you have a system needing change, but not able to handle the pressure of the changes desired, don’t lose hope. As you apply different options and press forward with specific plans; change can occur. It just takes ongoing review of what has and has not worked and the attempt to change using a variety of applications and process to make the changes to the system the organization sees as necessary.

A system’s behaviour depends on the total structure. Change the structure and the behavior changes.

Richard Lepsinger writes:

“Organizational structure and management systems must support and reinforce that behavior.” (p. 206)

Structure is not simply the design or the management structure put in place to run the organization. It is a ‘both/and’ proposition. Both design and management structure must work hand in hand to ensure the ongoing health of the organization. Design and management structure must reinforce the total structure together.

Leadership in the design and management structure is paramount to ensure the ongoing success of the organization. Changing the design, management structure of leadership focus of the organization changes the structure and in course, the behaviour of the organization and all its component parts. The process involves a great deal of commitment and focus to get it right.

Leonard Sayles, as quoted in Mintzberg, Ahlstrand and Lampel’s Strategy Bites Back (p. 45), notes leaders are like symphony conductors endeavour, to maintain a melodious performance in which the contributions of the various instruments are coordinated and sequenced, patterned and paced , while the orchestra members are having various difficulties , stage hands are moving music stands, alternating excessive heat and cold are creating audience and instrumental problems, and the sponsor of the concert is insisting on irrational changes to the program.

In the same way, orchestrating the organizational and management systems to support and reinforce behaviour reuires a specific finesse to ensure the whole is not overpowered by subordinate parts to dominate the outcome of organizational vision and focus. Leadership is the central focus to make this balance happen.

There is a limit to how big a system can grow.

No matter what the business model, there is a limit to how big a system can grow before it becomes unmanageable and must break into subsystems or lesser systems to continue to grow and expand.

David Walonick suggests there are a number of reasons for upper growth limits that still have relevance today.

Organizational growth does not continue indefinitely. An upper asymptopic limit can be imposed by a number of factors. Land and Jarman (1992, p. 258) identify the most common reasons why organizations reach upper growth limits:

Rapidly increasing internal and market place complexity in such areas a product proliferation and market divisions
Internal competition for resources
Increasing cost of manufacturing and sales
Diminishing returns
Declining share of the market
Decreasing productivity gains
Growing external pressures from regulators and influence groups
Increasing impact of new technologies
New and unexpected competitors

Being ahead of the challenges and staying aware of the various factors affecting organizational growth will allow leaders to anticipate changes (expected and unexpected), while responding to the challenges they represent.

Organizational Learning Disabilities

• I am my position – when we confuse our position in an organization with our personal identity, every failure, criticism, success and victory is a direct reflection of our worth. We are more than our position. Getting sucked into that thinking only leaves us feeling unfulfilled and at times hamstrung by the challenges we face, where we could be an integral part of the solution versus mired in guilt and shame over organizational performance.(Senge, p. 18)

• The enemy is out there – as stated earlier, we often look for scapegoats to take the blame and blame shift our responsibility to find others responsible for our failings and conversely for our success. Blame works both ways. Similarly, when we look for an enemy we can find one, but blaming them for outcomes limits our locus of control to things beyond our control affecting our organizational success. We may see challenges on the horizon, but the challenges are not the enemy. We are our own worst enemies and that enemy is usually from within. (Senge, p. 20)

• The illusion of taking charge – Being proactive when challenges arise is good, but don’t mistake proactive action for reflexive reaction to the challenges. Proactivity faces the difficult issues without waiting for someone else to step up to do it. Proactive is anticipatory. Waiting until the challenge arises or controls the organizational scenario before taking action is reactionary. Taking charge proactively is a positive response to impending challenges. Waiting for them to occur is not. (Senge, p. 20)

• The fixation on (short term) events – when we focus our attention on short term events occurring within the organizational parameters around us versus describing longer term pattern explanations to describe a longer view of where the organization is going, we can fixate on short-term reporting and miss the long term implications to the organizational structures and processes. (Senge, p. 21)

• The parable of the boiled frog – “where we do not see gradual changes, much like a frog in a pot will relax into drowsiness as its water is slowly heated.” (Mister Ambiguous)

• The delusion of learning from experience – “because some effects are beyond the current limits our awareness (e.g., effects in time, non-linear effects), we do not experience many of the effects of our actions.” (Mister Ambiguous) This is reminiscent of Senge’s law where “Cause and effect are not closely related in time and space.” (p. 63) Sometimes the results of our actions occur far past the time things are put in motion.

• The myth of the management team – Teams spend much of their time fighting for turf, avoiding anything making them look bad, while pretending everyone is behind team strategies. (Senge, pp. 18-19) Their energies are mis-focused. Instead of focusing on solutions to the challenges at hand, they are focused inwardly toward self-protection.

Learning Activity 3. 1

Unit Learning Outcome

Upon completion of Learning Activity 3.1 learners will be able to:

1. Understand Senge’s fundamentals (laws) for systems thinking and the development of Strategic Leadership principles.

As you complete your reading of, A Systems Thinking Primer: Seeing Organizations in Action, reflect on the following questions to help you understand your System Thinking practice in the organization you presently serve or recently served.

Create a new post on your blog and reflect on 2-3 key take-aways from the reading for this activity and indicate how those take-aways are relevant to your context or experience in systems thinking. There are some questions below that may guide your post, but you are not required to address all of these questions.

Categories for this post:

• ldrs501
• Senge

1. How does your organization, or the organization you previously served, practice Senge’s fundamentals (laws) for systems thinking?
   • What are some of the positive outcomes from practicing these fundamentals (laws)?
   • What are some of the negative outcomes from practicing these fundamentals (laws)?
   • What one change would you introduce to the practice of these fundamentals (laws) to improve what your organization, or the organization you previously served, accomplishes through their systems practice?
2. How does your organization, or the organization you previously served stack up to the additional 5 laws listed above?
   • Reflect on the impact these additional laws have on your organization, or the organization you previously served?
   • Which of these 5 listed additional laws are most evident in your organizational practice? What are their impact?
   • What organizational changes would you introduce to mitigate the effect of a departure from these 5 additional laws in your organization or the organization your served previously?
   • What organizational learning disabilities have you experienced in your career?
3. Have any of the organizations you worked with successfully navigated from disability to ability in their systemic practice?
   • What is the most memorable success story for that change?
4. If you had the opportunity to speak into your organization to change the evident disabilities, what would you say and what processes would you suggest to turn the corner from disability to ability?

As you complete these questions, you will have a better grasp on Systems Thinking practice and the development of Strategic Leadership principles going forward.

Learning Activity References

Fractal Foundation (2018) What is chaos theory?

GE Power and Water (2012) Handbook of industrial water treatment: chapter 14 – boiler system failures. Boston MA:General Electric Company.

Haines, S. (2000). The systems thinking approach to strategic planning and management. Washington DC: St. Lucie Press.

Issitt, M. (2013). Chaotic systems. In Salem Press Encyclopedia of Science.

Lepsinger R. (2010). Closing the Execution Gap. San Francisco: Jossey-Bass.

Mintzberg, H., Ahlstrand, B., & Lampel, J. (2005). Strategy bites back: it is far more, and less, than you ever imagined. Upper Saddle River: Pearson Prentice Hall.

Mister Ambiguous. (February 2, 2002). Senge’s 7 organizational learning disabilities.

Senge, P. (2006). The fifth discipline. New York: Doubleday

St. Louis, D. (January 30, 2015) Why Target failed in Canada, and what other companies can learn from it. Visioncritical: Vancouver BC.

Walonick, D. (1993) Organizational theory and behavior.

Zeeman, A. (2017). Senge’s Five Disciplines of Learning Organizations.

As leaders you are on your life long learning journey as a systems thinker