Systems thinking on the rise

‘Command and control’ management has had its day. The ideas that have characterised management thinking since the turn of the last century will wane as we enter the new millennium. How can I be so sure? Because better ideas have been around for the last fifty years and, as is so often the case with new ideas, they have taken some time, but are at last beginning to catch on.

What do I mean by ‘command and control? I’m sure you will recognise this: We think of our organisations as a ‘top-down hierarchies’. Work is designed in functional specialisms. Decision-making is separated from work – decision-making being management’s job – and in making decisions, managers use measures of budget, activity, productivity, standards and the like. Managers are taught their job is to manage budgets and manage people. Most organisations are designed and managed this way. The news (if it is news for you) is this doesn’t work very well; there is a better way.

Consider this: The number of man hours it takes to build a Lexus is LESS than the number of man hours used to RE-WORK a top-of-the-line luxury German car at the end of the line after it has been made. Are the Toyota people smarter, more committed, more enthusiastic or is it perhaps because they are Japanese that they can achieve this? None is true. Toyota achieved this extraordinary leap in performance by using better methods. These methods weren’t dreamt up in a boardroom, they emerged from solving practical problems while working against seemingly insurmountable odds. Is this better thinking unique to Toyota? No, many organisations are now learning to work this way.

In short, the better way is based on systems thinking. In short, systems thinking teaches management of flow not function. Here is just one simple example: When you call a service organisation, if they understand why you called, from your point of view, and respond by doing what matters to you – and only that – you would think you got great service. From their point of view, any organisation working this way would achieve lowest costs. Magic. Systems thinking provides method for improving service and lowering costs. Not something many managers would comprehend for they traditionally have been taught that service and cost must be ‘balanced’.

Systems thinking. Watch out for it, it could radically improve your performance.


A rejoinder to the IT Y2K question

Re my last piece in this newsletter (‘Is IT bugging you?’). During the millennium hangover, the Observer reported that Russia spent only 2% of what the USA spent on Y2K compliance. Makes you think doesn’t it? What might be the next IT scam for getting us to part with buckets of money? What value are we getting from IT?


The ISO 9000 year 2000 revision

I have been asked by my publisher to up-date “In Pursuit of Quality: the case against ISO 9000” for the forthcoming year 2000 revision. This will probably go out in paperback with a revised title (“The Case Against ISO 9000”) to coi9ncide with the year 2000 revision’s publication.