Seeing the Big Picture The Ten Principles of Systems Thinking

1. Seeing the Big Picture The Ten Principlesof Systems Thinking C. James Bacon cjamesbacon@gmail.com

2. Agenda (CIIT/BCS Dorset Branch Wed. 14 Nov. 2012 A quick & preliminary look at the Ten Principles: A Framework for Systems Thinking. Where the story begins: book-in-progress on “Joining Up Business-IT: A Systemic Solution”. Why the book: (1) Make IT-in-Organisations understandable. (2) IT fails most of the time. The book’s JUMP Model - based on Systems Thinking: A Framework for IT-in-Organisations. Back to the Ten Principles (its another book). A basic cause of (IT) failure: Parochial Thinking - The Queen’s Question and other examples Agile/Lean Development: it’s the way to go but – the Parochial Thinking Risk is greater. The first two principles: (1) See the Big Picture, (2) Everything is a system. Systems Thinking Techniques – How to do Systems Thinking. Soft Systems Methodology. The Synergy Principle – how to join up Business and IT. The Upside & Downside of Systems Thinking. Why You should think Systemically. Discussion If there is time – more detail.

3. Seeing Everything as a Holistic System A system is anything made upof intra-dependent partswhich act together for a purposewith some form of input, processand outputand which must, as a whole,intra-act effectively and inter-act & adapt continuouslywith its external/contextual environmentto remain viable. is Systems Thinking An Open System

4. Some Types of System • You might say that my laptop and Iare two parts of a system. • If it does what I need andif I do what it needs, • - then we’re cookin’! - We’ve got synergy! • A business/govt. organisation. • A bus./govt. department • A football team; a football club • A tree; a forest. • A plant; a flower. • Rainfall & rivers. • The Earth; the Universe. • A school; a university. • A supermarket; shopping at. • The roads in/around a town. • But I guess there areother parts in our system,like software, data, - and maybe people! • And I guess we’re part ofa bigger system as well! • A computer information system. • A business process. • An accounting system. • The global financial markets. • A human being (body/mind/spirit).

5. The Ten Systems Thinking Principles: A Framework for Systems Thinking Everything is a system and every system has its purpose or purposes. See the Big Picture:the holistic & systemic whole. Each part of a system is dependent uponand needs to work well with the other parts. Every system must continuously inter-relate with and adapt to its context or external environment to remain viable. A human organisational system must have effective communication and dialogue in working well and in adapting to internal and external change. Synthesis before Analysis. First look to the idealised design. Synergy results from the actualisationof idealised intra-relationships Every system has an optimum min/max size. Optimal efficiency of a part in itself detracts from overall effectiveness.

6. The Importance of Structure in/for Understanding, Learning, and Knowledge A Systemic Approximation of Knowledge Formation The External: People/Things/the World Mind & Memory (short/long-term) ReceivedInformation Structure/Structuring SensesPerception Learning Processing Understanding Knowledge Analysis/Synthesis Thinking (fast/slow) Awareness & Feelings Experience (verb/noun)Observing/Doing(passive/active) Action Daniel Kahneman

7. Socio-Economic Impact – of Business-IT Failure Impact on privacy Frustration, stress and ill health Waste of people potential Poor customer service & value Job losses Higher taxes Loss of life Wasted time Poor collaboration, innovation, knowledge growth Poor public health/social services Ineffective government

8. The JUMP Model ASystemic Frameworkfor ITin Organisations Based on: Systems Thinking A research method known as the Constant Comparative Method of Grounded Theory (Glaser & Strauss). A global Delphic survey of 50 senior academics and many business managers. Pursuit of the Null Hypothesis Principle with audiences and thought leaders in attempts to disprove the validity of the model. Iteration & refinement. The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s InformationSystems (IS) & Applications (Apps) ITProfessionals - Including C y b e r s p a c e Information & CommunicationsTechnology (ICT) IT MOMSManagement Organisation Methodsand Skills - - - Systems Development& Support IT Customers InformationValue Leadership & Culture Management & Mgt. Processes IT Customers System& NetworkOperations - Including C y b e r s p a c e Data P h y s i c al I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

9. The JUMP 12-Part Model (part 1): The External Customer and - - Including C y b e r s p a c e - Including C y b e r s p a c e - Socio-Economic Environment

10. The JUMP Model (part 2) The External Customer and - Governance & Guidance The (virtual) - - Including C y b e r s p a c e Leadership & Culture Management & Mgt. Processes - Including C y b e r s p a c e - Business Organisation Strategy & Structure - Socio-Economic Environment

11. The JUMP Model (3 and 4) The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s - Including C y b e r s p a c e Leadership & Culture Management & Mgt. Processes - Including C y b e r s p a c e P h y s i c a l ICT I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

12. The JUMP Model (5 and 6) The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s ITProfessionals - Including C y b e r s p a c e IT MOMSManagement Organisation Methodsand Skills - - - Systems Development& Support Leadership & Culture Management & Mgt. Processes - Including C y b e r s p a c e P h y s i c a l ICT I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

13. The JUMP Model (7 and 8) The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s ITProfessionals - Including C y b e r s p a c e Information & CommunicationsTechnology (ICT) IT MOMSManagement Organisation Methodsand Skills - - - Systems Development& Support Leadership & Culture Management & Mgt. Processes System& NetworkOperations - Including C y b e r s p a c e P h y s i c a l ICT I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

14. The JUMP Model (9 and 10) The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s InformationSystems (IS) & Applications (Apps) ITProfessionals - Including C y b e r s p a c e Information & CommunicationsTechnology (ICT) IT MOMSManagement Organisation Methodsand Skills - - - Systems Development& Support Leadership & Culture Management & Mgt. Processes System& NetworkOperations - Including C y b e r s p a c e Data P h y s i c a l ICT I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

15. The JUMP Model (11) The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s InformationSystems (IS) & Applications (Apps) ITProfessionals - Including C y b e r s p a c e Information & CommunicationsTechnology (ICT) IT MOMSManagement Organisation Methodsand Skills - - - Systems Development& Support IT Customers Leadership & Culture Management & Mgt. Processes IT Customers System& NetworkOperations - Including C y b e r s p a c e Data P h y s i c a l ICT I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

16. The JUMP Model – part 12 ASystemic Frameworkfor ITin Organisations The External Customer and - Governance & Guidance The (virtual) - B u s i n e s s P r o c e s s e s InformationSystems (IS) & Applications (Apps) ITProfessionals - Including C y b e r s p a c e Information & CommunicationsTechnology (ICT) IT MOMSManagement Organisation Methodsand Skills - - - Systems Development& Support IT Customers InformationValue Leadership & Culture Management & Mgt. Processes IT Customers System& NetworkOperations - Including C y b e r s p a c e Data P h y s i c a l ICT I n f r a s t r u c t u r e - Business Organisation Strategy & Structure - Socio-Economic Environment

17. The Agile/Lean Challenge:the IT Customer/User Perception& Experience Background& Context “I don’t see that IT makes a difference to business performance”. Never been exposed to Systems Thinking; a Parochial Thinker. “I don’t understand IT, and don’t have the time or need to understand it”. Needs education on theinter-connections in Bus.–IT. What d'ya want from me;computers are not my thingand I don’t have the time! Not aware of IT needin business strategy. “My experience with IT has not been good”. Not in a joined-up culture. “Why don’t the IT people just get on and do it?” Doesn’t see the vital role ofthe Bus.-IT savvy IT Customer. “IT doesn’t make my job any easier”. Doesn’t see IT leadershipor example in senior mgt. “IT people don’t understand the business”. Not aware of external or evencross-organisational impacts. “IT just costs time & money”.

18. The Risk in Agile/Lean Development:A Parochial Thinking Perspective • That doesn’t affect me. • Forget about the general stuff; let’s get on with the job at hand! • We know what we need; it’s obvious! • My job, My skill, My department, My agenda. • Tick the boxes – job done! • The problem is obvious; it’s in the numbers! • Us v. Them. • What’s in it for me? • I can’t help them; it will stop me meeting my target! • You don’t understand me. • That’s not my job. • You should know what I need; just do it! • Just tell me what you want; that’s all I need to know. • That’s my specialisation; that’s what I do. Boxed-In Thinking

19. Silo/Stovepipe Thinking – and IT • We naturallythink parochially (in silos): - My job, My skill, My department, My agenda, My needs, My box. • And this translates into the common problemfor IT in Organisations of -doing things in silos: • - hardware requirements • - patches • - enhancements • - project management • - systems audit • - data analysis • - development projects, • - user requirements • - spread sheets • - cost v. benefit Withunintendedyetpotentiallydisastrous and/or expensiveconsequences

20. The Parochial Thinking Perspective:Example Birmingham City Council's Computerised Phone SystemBaffled By Brummie Accent . Nov. 2012. An automated phone system was flummoxed by the local Brummie accent. The service featureda female voice witha Geordie accent. The system cost £11 m. The system wasde-commissioned.

21. Lean + Systems Thinking= Cost-Effectiveness The Metropolitan PoliceDirectorate of Information • Compelling Reasons: • Forced to cut costs by 25% over three years. • Decided Lean was the only way. • Systems Thinking Principles: • Looked at Purpose. • Idealised design. • Synthesis before analysis. • Lean Principles: • Senior Management active support. • People Buy-In. • Customer Value & Value Streams. • Eliminate waste. • Customer-IT empowered teams.

22. The Ten Systems Thinking Principles – Some Techniques (1) Everything is a system and every system has its purpose or purposes. See the Big Picture:the holistic & systemic whole. Each part of a system is dependent uponand needs to work well with the other parts. Every system must continuously inter-relate with and adapt to its context or external environment to remain viable. A human organisational system must have effective communication and dialogue in working well and in adapting to internal and external change. Synthesis before Analysis. First look to the idealised design. Synergy results from the actualisationof idealised intra-relationships Every system has an optimum min/max size. Optimal efficiency of a part in itself detracts from overall effectiveness.

23. First Synthesise then Analyse: e.g. Looking at a Dept./Function as a System • 1. Identify & agree the Subject System with which we’re concerned as a systemic whole, in its Boundaries and Sub-Systems. • 2. Describe theContextual System within which the Subject System exists, which is the next system up, in this case the Organisation. • 5. Analyse the Subject system in termsof its Sub-Systems ,their intra-relationships,and their inter-relationships withthe Contextual system. & Supra System. • 3. Appreciate the Supra system within which the Contextual organisational system exists, which in this case is the External Customer & Socio-Economic Environment. • 4. IdentifyRelated systems/functions with which the Subject System inter-relates.

24. Systems Thinking and IT:The Seven Hats Perspective Who wears this hat?Information Value Management Accountant IT Professional:Systems & Technology Subject:A dept., function, system, process, etc in the organisational context. CEO:Top/Overall View Operations:Business Process& Internal Customer Sales & Marketing: External Customer Sociologist (HR?):People: What they do (and need to do),Why they do it, How they work,and How they interact

25. Help! costs are growing too fast! Mortgage Seeker We’re separate From the restof the Business Accounting Customer Service Rich Picture: Mortgage Brokers Sales Dept. Present Context SSM I can get How can IT systems Change! Flexibility! independent advice help us to be more Fast response to and the best deal competitive? new rules, new ways, new categories! How do we automate our business rules? We have to compete! Our customer service and bus. processes need to be efficient and cost-effective! I’m fed-up with these guys, … they never get our commissions Senior Management right! Competitor Brokers Mortgage Brokers Mortgage FirmDirector Sales MortgageProvider Agent Dept Associate It makes it very Firm difficult to do your job without the right I just cannot handle information! all the paperwork! Sales & Mktg . Internal Mortgage Sales Director Rep Support Commissions are a problem! Staffer Mortgage Admin. & Research Finance Regulatory Regulator - Markets They blame us for bad - Data Admin. - Providers information, but its - Guidance - Investments Ombudsman not our fault! - HR - Accounts - Budgets -Commissions

26. Causal Loop Diagramme (Simple Format):A Systemic View of Issues:Proposed New Road Around the Town Number ofRoads Dependenceon Cars Cost ofPetrol Reliability ofPublic Transport TrafficCongestion Cost ofPublic Transport EnvironmentalPollution GovernmentSubsidies Road TrafficDeaths Independencein/of travel

27. Business Root Definition: A Hospital Ward SSM • 1. Purpose:To make people well and/or recover, and sustain human life within a context of patient care, dignity, and clinical excellence. • 2. Ownership: The trustees, the funding authority, and the public as taxpayers. • 3. Process: (1) GP referral, (2) initial assessment, (3) intake, (4) appropriate & effective procedures and care, (5) recovery, (6) exit (7) follow-up, (8) GP care. • 4. Customers: The patients. • 5. Stakeholders: Patients’ families, staff, trustees, the general public, the funding authority, and the government. • 6. Actors/Doers: Front-line caring staff, support staff, senior staff (surgeons and specialists), and admin./mgt. staff. • 7. Constraints: Funding levels, staffing levels, administrative overhead, government & regulatory requirements, hygiene & safety requirements. • 8. External Context: The Department as a whole, other wards and interfacing departments, the Hospital as a whole, and the community and general public.

28. Mind-Mapping First look to the idealised design See the Big Picture:the holistic & systemic whole A human organisational system must have effective communication and dialogue in working well and in adapting to internal and external change Optimal efficiency of a part in itselfdetracts from overall effectiveness Synthesis before Analysis Synergy results from theactualisation of idealisedintra-relationship Every system has an optimummin/max size. How can we apply the tenSystems Thinking Principlesto Agile/Lean Development? Everything is a system and every system has its purpose or purposes Every system must continuously inter-relate with and adapt to its context or external environment to remain viable. Each part of a system is dependent uponand needs to work well with the other parts

29. The Soft Systems Methodology (SSM) ApproachPeter Checkland • 6. Changes that are systemically desirable and culturally feasible. 1. Statement of situation or issue considered problematic. • 7.Action to improve the problem situation. 2. Problem situation expressed using Rich Pictures and other means. 5. Comparison of idealised, conceptual model with the real world. The Real World 4. Idealised, conceptual model of system, based on root definition, and represented in the form of simpleBusiness Activity/Process Models. Systems Thinkingaboutthe Real World 3. Business Root Definitionof subject system.

30. The Synergy Principle Everything is a system and every system has its purpose or purposes. See the Big Picture:the holistic & systemic whole. Each part of a system is dependent uponand needs to work well with the other parts. Every system must continuously inter-relate with and adapt to its context or external environment to remain viable. A human organisational system must have effective communication and dialogue in working well and in adapting to internal and external change. Synthesis before Analysis. First look to the idealised design. Synergy results from the actualisationof idealised intra-relationships Every system has an optimum min/max size. Optimal efficiency of a part in itself detracts from overall effectiveness.

31. Remind me: what is Synergy? • When the combined effect of the different parts of a system exceeds the sum of their individual effects. • The product of the relationships in a system, particularly a human organisation system. • The added-value effect in effective collaboration or combination. 2 + 2 = 7

32. Business-IT Synergy Theory How can we enhanceSynergyin the intra-relationshipsbetween the basic/intrinsic, intra-dependent areasof IT in Organisations? - If there is Synergy between the basic/intrinsic intra-dependent areas of IT-in-Organisations- as in the JUMP Model then there isJoined-Up Business-IT ! 1. Determine the Purposeof the relationship. 2. Include this Purpose in an Idealised/Synergistic Expressionof the relationship. 3. Based on the Idealised/Synergistic Expression, find Possible Actionsthat might enhance Synergyin the relationship. 5. So as to Actualisethe Idealised/Synergistic Expression. 4. Using the Possible Actions, dialogue for Payback Actions.

33. Seeing significant issues that would not otherwise be seen. • Asking important questions that would not otherwise be asked. • Solving if not avoiding problems that would not otherwise be seen or solved. Systems Thinkingas Double-Edged Sword - The Upside - the Downside • Gaining in Performance. • Gaining in Innovation. • Gaining in Wisdom. • Being different from most other people. • Getting too much information, and taking too much time in getting it. • Not having sufficient power/authority to do much with it (Systems Thinking). So what to do about these things?

34. And if you can think Systemically Then you have The ability to see the Big Picture and see where others do not seeand to help if not lead otherswith this wisdom YOUR COUNTRY NEEDS YOU YOU TO Think Systemically