systems thinking for teams leaders and policy makers
TRANSCRIPT
Systems Thinkingfor Teams, Leaders & Policy-Makers
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Ever wonder …
• What causes the economy to cycle and crash?• Is global warming all bad?
• Would there be less crime if drugs were legal?• Why do profits rise and fall?
• What will healthcare reform or tax reform bring?• Why change programs fail?
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Tough Questions!
• How would you begin to answer these questions?
• Would others agree?• How would you get other people TO AGREE?
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Systems Thinking• Systems Thinking is any process of foreseeing how
local policies and actions influence the state of the universe
• We all have different views of how the world works (how this affects that – why events happen)
• To some degree we’re already Systems Thinkers
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Systems Thinking
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
• But we didn’t start out as Systems Thinkers
• Our young INFINITE minds were wide open to accepting the way our teachers thought
What do children do with new objects?
New Object
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Analytic Thinking
1. Take apart2. Try to understand what the parts do3. Assemble understanding of the parts into an
understanding of the whole
Whole = ΣParts
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
?
Analytic Thinking
• We use analytic thinking to try and understand people as well
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
President = George + Bush + Republican
Sales Service Quality R&D
Analytic Thinking
• We use analytic thinking when our business is not meeting its goals
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Sales
• From a very early age we are taught to break apart problems; to fragment the world. This apparently makes complex tasks and subjects more manageable, but we pay an enormous hidden price. We can no longer see the consequences of our actions. We lose our intrinsic sense of connection to a larger whole.
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
• When we then try to see the big picture we try to reassemble the fragments in our minds, to list and organize the pieces, but the task is futile. It’s similar to trying to reassemble the fragments of a broken mirror to see a true reflection. So after a while we give up trying to see the whole all together.
Peter Senge
Analytic Thinking
• Formal education is based on analytic thinking
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
FinanceEconomics
Production
Personnel
Marketing
Management
Supply Chain
MBA
Analytic Thinking
• In many ways it’s like trying to understand life by studying the dead
Our entire culture is based on
Analytic Thinking
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
• Assumption:– If you know what the parts do you’ll be able to
integrate that knowledge into an understanding of the WHOLE
“Business” is the product of the
interactions between the parts
Analytic Thinking
Finance
Economics
Production
Personnel
Marketing
Management
Supply ChainJohn Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Analytic Thinking
• It’s not surprising that corporations, governments and organizations are created and managed by parts
ProductionSales
R&D HRCustomer
Service QualityIT
Corporate System
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
How is problem-solving approached in companies?
Analytic Thinking• Analytic Thinking can’t tell us why we’re getting the
results we’re getting because the parts lose their meaning when separated from the whole
• This sets up learning disorders in organizations because cause and effect are often separated in space and time
• System dynamics and delays make it impossible to judge or measure the effectiveness of our actions
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Roll Video
Analytic vs. Systems Thinking
Analytic Thinking1. Take apart2. Try to understand
what the parts do3. Assemble your
understanding of the parts into an understanding of the whole
Systems Thinking1. Determine what it’s a
part of2. Try to understand the
behavior of the whole3. See the functional
interdependencies of the parts with respect to the whole
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Analytic vs. Systems Thinking
Analytic Thinking1. Take apart2. Try to understand
what the parts do3. Assemble
understanding of the parts into an understanding of the whole
Systems Thinking1. Determine what it’s a
part of2. Try to understand the
behavior of the whole3. See the functional
interdependencies of the parts with respect to the whole
Whole = Sum of Parts
Whole = Product of Part
Interactions
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Analytic vs. Systems Thinking
Analytic Thinking1. Take apart2. Try to understand
what the parts do3. Assemble
understanding of the parts into an understanding of the whole
Systems Thinking1. Determine what it’s a
part of2. Try to understand the
behavior of the whole3. See the functional
interdependencies of the parts with respect to the whole
How parts work & the role they
play
Why events occur
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Why “Change Programs” Fail1. Focus is on getting people
to do things faster and better rather than improving the system they are part of
2. Many times the system that needs changing is our own beliefs or paradigms and habitual thought processes
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Rx: Systems Thinking Rx: Thinking
Into Results
More later…
Systemic Problem-Solving
Non-Systems Thinking
SystemsThinking
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Today’s solutionstomorrow’s problems
Tools for Systems Thinking
Measurement Material
ManMotherNature
Machine
Method
Problem
Cause-Effect Diagram
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Analytic Thinking
Measurement
Material
ManMotherNature
Machine Method
Causal Loop DiagramSystems Thinking
Mostly Cause Theories All Causal Facts
Itching & Scratching
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Itching Scratching++
-Connection Matrix
(Destination)
(Source)
Biological System
Itching & Scratching
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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No Scratching
Itching
No ScratchingPattern =
Voice of the System
Voice of the System• Answers are not in
terms of how much or when– X-Y scales are unit less
• Answers are system behavior patterns– Pattern = Vibration
(Voice of the System)• Experienced as
recurring or isolated events in space & time
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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Itching & Scratching
Itching
Scratching
Scratching
Voice of the System
• Vibration is a universal language– Hear, see, smell, taste,
touch is all vibrational energy
• System vibration also tells us what to expect
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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Itching
Scratching
Scratching
Highway Accident Rate
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
2 Accident
Rate
3Patrol
Frequency
1 VehicleSpeed +
+
-+
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Connection MatrixDestination
1 Speed 2 Accident Rate 3 Patrol Freq.1 Speed 0 1 1
Source 2 Accident Rate 0 0 13 Patrol Freq. -1 -1 0
Opinion of an Expert
Highway Accident Rate
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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1 Speed
2 Accident Rate3 Patrol Freq.
Highway Accident Rate
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
5 Traffic
Congestion
6 Bad
Weather
4 Raise
Driver Age
7 Driver’s Risk
Aversion
2 Accident
Rate
3Patrol
Frequency
1 VehicleSpeed +
+-
-+
8 Driver’s
Education
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
2 AccidentRate
3 PatrolFrequency
1 VehicleSpeed +
+--
+
5 TrafficCongestion
4 Raise Driver
Age
7 Driver’s RiskAversion+
8 Driver’sEducation
+
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6 BadWeather
Policy not in our control
Policy in our control
Highway Accident Rate
Expert Opinion
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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eAccident Rate (Raise Driver Age & Driver's Education are Active)
1 Speed2 Accident Rate
3 Patrol Freq.4 Raise Driver Age5 Traffic Congestion
6 Bad Weather7 Driver's Risk Aversion8 Driver's Education
Highway Accident Rate
VehicleSpeed
Driver’s RiskAversion
< AccidentRate
Product Line Profit
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
1 Production
2 Costs
3 InventoryGrowth
4 UnmetDemand
5 CompetitorSales
6 Sales7 Demand
8 Price
9 Revenue
10 Profit 11 Advertising
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Product Line Profit (Present State Policy)
1 Production
2 Costs
3 Inventory Growth
4 Unmet Demand
5 Competitor Sales
6 Sales
7 Demand
8 Price
9 Revenue
10 Profit
11 Advertising
Product Line Profit
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Run 3 to 1 6 to 11 6 to 8 MScore(SS) VScore1 -1 -1 -1 4.3 4.282 -1 -1 0 -1.6 1.043 -1 -1 1 0 14 -1 0 -1 8.2 4.64 < Optimal5 -1 0 0 4 4.16 -1 0 1 -0.1 1.297 -1 1 -1 16.8 1.088 -1 1 0 6.8 3.339 -1 1 1 4 4.1
Target Variable = ProfitConnection Policy
Profit CLD Simulation Experiment
01234567
-20 -15 -10 -5 0 5 10 15 20
Vsco
re
Mscore
Profit Policy Scores
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eProduct Line Profit (Future State Policy)
1 Production
2 Costs
3 Inventory Growth
4 Unmet Demand
5 Competitor Sales
6 Sales
7 Demand
8 Price
9 Revenue
10 Profit
11 Advertising
Sick Call-Ins
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
12 FamilyTime
1 EmployeesIn Training
2 Sick Call-Ins
3 Late Employees
4 Employees Temporarily Reassigned
5 Available Employees 6 Productivity
7 Perceived Training Rqmts.
8 Overtime Utilized
9 Employee Morale
10 Mgrs Doing Employee's Duties
11 Supervision Quality
+
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-
+ +
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13 Delay-
-
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14 Return Early if Possible
17 Evaluate ROI
15 Barrow EmployeesFrom Other Depts. 16 Remind Employees of
Proper Call-In Policy-
+
-
Sick Call-Ins
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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Sick Call-In Issue (Present State)
1 Employees In Training
2 Sick Call-Ins
3 Late Employees
4 Employees temporarily Reassigned
5 Available Employees
6 Productivity
7 Perceived Training Rqmts.
8 Overtime Utilized
9 Employee Morale
10 Mgrs. Doing Employees Duties
11 Supervision Quality
12 Family Time
14 Return Early If Possible
15 Barrow Employees From Other Depts.
16 Remind Employees of Proper Call-In Policy
17 Evaluate ROI
Sick Call-Ins
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
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Sick Call-In Issue (Active Training ROI Evaluation)
1 Employees In Training
2 Sick Call-Ins
3 Late Employees
4 Employees temporarily Reassigned
5 Available Employees
6 Productivity
7 Perceived Training Rqmts.
8 Overtime Utilized
9 Employee Morale
10 Mgrs. Doing Employees Duties
11 Supervision Quality
12 Family Time
14 Return Early If Possible
15 Barrow Employees From Other Depts.
16 Remind Employees of Proper Call-In Policy
17 Evaluate ROI
Sick Call-Ins
Employee Morale
Late Employees
Mgrs. DoingEmployees Duties
Cash for Clunkers
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
5 Fund Growth
6 Interest Income
8 DirtyCars
3 Buy Back Withdrawals
9 Car Emissions
11 Delay
12 Delay
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Cash for Clunkers
Clean Car Rebates
Dirty Car Sales Fees
Dirty Car Buy Back
1-Time Funding
Fund Growth
Interest Income
Clean Cars
Dirty Cars
Car Emissons
Cash for Clunkerswith FeeBate Structure
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
5 Fund Growth
6 Interest Income
7 CleanCars
8 DirtyCars
3 Buy Back Withdrawals
1 Clean CarRebates
2 Dirty CarSales Fees
9 Car Emissions
10 Delay
11 Delay
12 Delay
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anda
rdize
d Sc
ale
FeeBate Policy
Clean Car Rebates
Dirty Car Sales Fees
Dirty Car Buy Back
1-Time Funding
Fund Growth
Interest Income
Clean Cars
Dirty Cars
Car Emissons
Modeling Hierarchy
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Time & Effort
Valu
e (U
tility
)
+ Causal Magnitude
+ Functional Form
+ Constraints
+ Learning new language & software
Seeking Structure Instead of Blame
ModelingHierarchy
+ Noise uncertainty with all the above
+ CLD (Key Variables, Causal Arrows & Signs)
VOS
Google CLDs
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Alan Greenspan
1 Production
2 Costs
3 Inventory
4 UnmetDemand
5 CompetitorSales
6 Sales7 Demand
8 Price
9 Revenue
10 Profit 11 Advertising
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Time
1 EmployeesIn Training
2 Sick Call-Ins
3 Late Employees
4 Employees Temporarily Reassigned
5 Available Employees 6 Productivity
7 Perceived Training Rqmts.
8 Overtime Utilized
9 Employee Morale
10 Mgrs Doing Employee's Duties
11 Supervision Quality
+
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-
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-
+ +
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Delay-
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CompanyPerformance
OrganizationPerformance
IndividualMorale
Thoughts& Emotions
Commitment& Action
TeamPerformance
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GoalAlignment
Mgt.Support
Needs Met
++
+
2 Accident
Rate
3Patrol
Frequency
1 VehicleSpeed +
+-
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2 AccidentRate
3 PatrolFrequency
1 VehicleSpeed +
+--
+
5 TrafficCongestion
6 BadWeather
4 DriverAge
7 Driver’s RiskAversion+
8 DriverTraining
+
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-
+ = Proportional
- = Inversely Proportional
Knowledge Networking(Linked Expert CLDs)
Expert CLD 1 Expert CLD 2
Expert CLD K
Expert CLD 4Expert CLD 3
TT
T
T
T
T
T
T = Target Variable
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
1 Production
2 Costs
3 Inventory
4 UnmetDemand
5 CompetitorSales
6 Sales7 Demand
8 Price
9 Revenue
10 Profit 11 Advertising
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Time
1 EmployeesIn Training
2 Sick Call-Ins
3 Late Employees
4 Employees Temporarily Reassigned
5 Available Employees 6 Productivity
7 Perceived Training Rqmts.
8 Overtime Utilized
9 Employee Morale
10 Mgrs Doing Employee's Duties
11 Supervision Quality
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Delay-
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CompanyPerformance
OrganizationPerformance
IndividualMorale
Thoughts& Emotions
Commitment& Action
TeamPerformance
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GoalAlignment
Mgt.Support
Needs Met
++
+
2 Accident
Rate
3Patrol
Frequency
1 VehicleSpeed +
+-
-+
2 AccidentRate
3 PatrolFrequency
1 VehicleSpeed +
+--
+
5 TrafficCongestion
6 BadWeather
4 DriverAge
7 Driver’s RiskAversion+
8 DriverTraining
+
+
+
+
+
+
+
-
+ = Proportional
- = Inversely Proportional
Knowledge Networking(Linked Expert CLDs)
Expert CLD 1 Expert CLD 2
Expert CLD K
Expert CLD 4Expert CLD 3
TT
T
T
T
T
T
T = Target Variable
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
LV L
V
T
LV
$
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Define•Create problem specification:
•Who (Who cares and why – VOC)• Extent (Scope, COPQ, ROI)•What, Where, When (Is and Is Not for each)
•Create team•Define target metrics
Measure•Gather baseline data for target metrics
Analyze•Research & development (operational thinking)
• See Six Sigma tools that facilitate creation of CLDs•Brainstorming system variables using 5-Whys•Organize using cause-effect (fishbone) diagram• Separate causal facts from theories•Create expert causal loop diagram (CLD)
• Expert mental model mixing• Simulate (event pattern inference)
•Determine leverage variables & policy types• Experiment & optimize target variable scores
Improve• Share with all stakeholders and adjust as needed• Execute policy design projects at optimal leverage points•Assess impact relative to baseline data
Control•Monitor target metrics, communicate and audit
Systemic Problem-Solving using DMAIC
Expert 1CLD
Expert 6CLD
Expert 3CLD
Expert 4CLD
Expert 5CLD
Expert 2CLD
Expert CLD
Expert KCLD
.
.
.
Knowledge Network
Systems vs. Statistical Thinking
• Statistical Thinking – Detect and react to
signals (not noise)– Prescribes appropriate
inaction
• Systems Thinking– How to react to signals– Prescribes appropriate
action
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Skills leaders, policy-makers and change agents need to cure corporate arrhythmias
Summary
• PROBLEMS? Don’t just do something, SIT THERE!– Take time to seek VOS not blame
• It’s possible to agree on answers to tough questions• We can create and simulate our mental models and
use them to test policies• CLDs are true cause-effect diagrams• Expert opinion is better than opinion of an expert• Sustainability requires knowledge of the parts and
how they interact and function as a whole
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
I don’t worry about the future;I know what will happen…“…managers will either learn how to optimize the system or they will go
out of business.”
W. E
dwar
ds D
emin
g
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Roll Video
Team Workshops• Create and simulate CLDs using CLD SIM• Call for group rates (includes CLD SIM)
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
1 Production
2 Costs
3 InventoryGrowth
4 UnmetDemand
5 CompetitorSales
6 Sales7 Demand
8 Price
9 Revenue
10 Profit 11 Advertising
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John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
CRC Press
Optimizing the Health of Your Company with Systems Thinking
Thinking Into Results
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Leadership Program
LifeSuccessCorporate.com
Systems Thinking changes the way
organizations see and approach problems
Thinking Into Resultschanges the organization’s
paradigms and habitual thought process
Belief System
• Does our experience create our beliefs or do our beliefs create our experience?
• Yes, both!
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
+Vision
Results + Action
++
Belief Potential+
Websitehttp://sites.google.com/site/roicreationsllc
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014
Systems Thinkingfor Teams, Leaders & Policy-Makers
John Dubuc ROI Creations, LLC Scottsdale, AZ (480) 283-7014