The first meeting begins with a “post-mortem” on the latest launch crisis. The team members tackle the issue with enthusiasm, jumping in with their own perspectives of what went wrong and why. At first the meeting seems to be going well, since everyone is obviously engaged in solving the problem. But as the meeting progresses, you start to feel like the group is spinning its wheels. The stories begin to resemble a jumble of personal anecdotes that share no common elements: “Well, on project X, we tried doing something new, and this is what happened…” or “This reminds me of the time when we implemented process Y and we were carrying spare parts in brown paper bags…” Lots of interesting stories are being exchanged, but they do not seem to be leading to a common understanding of the root causes.

The Storytelling Trap

Stories can be a powerful tool for engaging a group’s interest in a problem or issue. The specific details about people and events make it easy for most people to relate to stories, and they often provide a firm grounding in the day-to-day reality of the situation. But storytelling’s strength is also its Achilles heel: when we remain at event-level storytelling, it is difficult to generalize the insights to other situations, and so the solutions are often situation-specific. Without a deeper understanding of why something happened, the most we can do is find ways to react faster to similar events in the future.

FROM EVENTS TO VISION: STRUCTURED PROBLEM-SOLVING

By using a modified version of the “Vision Deployment Matrix,” a team can look at a particular problem under study from different perspectives. The “Current Reality” and “Desired Future Reality” columns allow you to differentiate between diagnosis of the current situation and proposed solutions for the future

Storytelling at Multiple Levels

One way that managers can move beyond event-level storytelling to a deeper understanding of an issue is to use a modified version of the Vision Deployment Matrix (see “Vision Deployment Matrix: A Framework for Large-Scale Change,” February 1995). In particular, applying the first two columns of the matrix (“current reality” and “desired future reality”) to a particular problem can provide a framework for both analyzing the current situation and designing an effective, long-term solution (see “From Events to Vision: Structured Problem-Solving”).

The matrix distinguishes between different levels of seeing and understanding a situation. The “Events” level captures stories about specific incidents or events that indicate a problem. The next level,“ Patterns,” expands the time horizon. At this stage, the team might ask, “Are these individual events or stories part of a larger pattern that has been unfolding over time?” Next, the “Systemic Structures” level looks at the structures that might be producing the observed pattern of behavior. Since those systemic structures are usually physical manifestations of deeply held mental models in the organization, the “Mental Models” level prompts the team to surface them. Finally, at the “Vision” level, the group considers how the vision of what the organization is creating might be influencing those mental models.

Analyzing a problem or situation from multiple levels can be useful in several ways. First, it forces us to go beyond event-level storytelling, where our ability to affect the future is low, to a perspective that offers greater leverage for creating systemic change. Second, the matrix provides a way to distinguish between different ideas and experiences (e.g., “Does this story illustrate a problem situation or a prevalent mental model?”). Finally, when the conversation does jump from events to specific systems to assumptions and so on, the matrix can provide a coherent framework for mapping everyone’s contribution in real time.

Using the Matrix

By filling in the matrix around a particular problem or issue, the team members can work together to raise their understanding from the level of events to patterns, systemic structures, mental models, and vision. For example, in the product launch situation, the team started with stories of a particular launch failure. After some discussion, the team discovered that the proper tests for verification were never conducted. But instead of going further into the details of why that process was neglected, the team can ask questions designed to draw the stories up to the patterns level, such as, “Was this indicative of a pattern that happens on all products?” Additional stories can then be used to establish whether that is indeed a pattern.

The next step is to identify the underlying structures that may currently be responsible for such behavior. In this example, the test and verification efforts all relied on a central group of people who were chronically overused by all the products under development, hence verifications were rarely done to the level specified. When the group tried to understand how engineers could justify skipping such an important step, they revealed an implicit mental model: “not knowing there is a problem and moving forward is better than knowing there is a problem and moving forward.” In short, the division had been operating according to an “ignorance is bliss” strategy.

To understand where this assumption came from, the group asked, “What is the implicit vision driving the process?” The most common answer was “to minimize unwanted senior management attention.” In other words, no one in product development wanted to have problems surface on their “watch.”

Although this team focused on the “Current Reality” column, they could also fill out the “Desired Future Reality” column by asking what kinds of new structures might be needed to prevent these problems from happening in the future.

Guiding Questions

The following set of questions can be used to guide conversations as a team moves among the different levels of perspective. In looking at current reality, it may be easier to start at the level of events (since that is where stories usually begin) and work your way up the levels. When mapping out the desired future reality, however, it may be better to begin at the level of vision and go down to the other levels so that your desired future reality is not limited by the current reality. Having said that, it is likely that in actual meetings the conversation will bounce all over the place. The main point is to use the matrix to capture the conversation in a coherent framework.

Current Reality

• What are some specific events that characterize the current reality?
• Are those specific events indicative of a pattern over time? Do other stories corroborate this repeated pattern?
• Are there systemic structures in place that are responsible for the pattern? Which specific structures are producing the most dominant pattern of behavior behind the current results?
• What mental models do we hold that led us to put such structures in place? What are the prevailing assumptions, beliefs, and values that sustain those structures?
• What kind of vision are we operating out of that explains the mental models we hold? What is the current vision-in-use?

Desired Future Reality

• What is the espoused vision of the future?
• What sets of assumptions, beliefs, and values will help realize the vision?
• What kinds of systemic structures are required (either invented or redesigned) to operationalize the new mental models and achieve that vision?
• What would be the behavior over time of key indicators if the desired vision became a reality?
• What specific events would illustrate how the vision is operating on a day-to-day basis?

By elevating the conversation from events to systems structure and beyond, this simple tool can help managers make clearer sense of their own experiences, and use those experiences to formulate more effective solutions to the problems at hand.

Daniel H. Kim is co-founder of the MIT Center for Organizational Learning, and of Pegasus Communications, Inc. He is a public speaker and teacher of systems thinking and organizational learning.

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1) Working on a range of actions to achieve some long-term outcome, for example, “in order to reduce urban poverty, we are going to start a microlending program, provide mentors to young people, and advertise to external investors,”

or

2) Implementing a policy that they believe will have broad, positive effects, for example, “by improving the efficiency of energy use, we can reduce air pollution, save money for businesses, and reduce greenhouse gas emissions.”

They look to systems thinking for some specific help in addressing questions such as, How can our team test our thinking about the best way to achieve our goals? How can we strengthen our strategy and achieve more success with less energy? And how can we avoid unintended consequences or “push-back” from the system?

To help a group respond to those queries, we lead them through a structured process that we are calling “action-to-outcome” mapping. We have found this approach particularly useful in situations where a team has already chosen a set of actions intended to achieve specific outcomes within an uncertain environment. This process can stand alone or lead to a more expansive effort to map, understand, and formally model the system in which the group is operating.

While we have used several variations, the core of our action-to-outcome mapping process involves five steps:

1. Exploring the existing causal theory,
2. Adding feedback,
3. Uncovering critical mindsets,
4. Accounting for external forces, and
5. Looking for opportunities for learning and action.

1. Exploring the Existing Causal Theory. The existing causal theory is the set of assumptions — explicit or implicit — that group members have about how their actions will lead to desired outcomes. The first step in the mapping process is to articulate those actions and outcomes and create a map connecting the two. By creating this kind of diagram, the group maps out the chain of cause-and-effect that would need to happen to achieve the desired outcome.

WATER CONSERVATION EFFORTS

This simplified causal map shows a proposed water conservation strategy in a particular region, including actions, intermediate indicators of success, and longer-term outcomes. Intermediate indicators are critical in situations where progress toward the ultimate goal happens very slowly and is influenced by many factors.

For example, “Water Conservation Efforts” shows a simplified causal map of a water conservation strategy in a particular region. In this case, the group was considering various actions to improve water management. Team members figured that writing and sharing case studies of urban water utilities with successful water conservation programs would encourage local utilities to follow suit. They hoped these companies would use conservation technologies to reduce water use and create a host of long-term benefits such as higher water levels in rivers.

We have also found it important to identify intermediate indicators that the group can use to measure progress. These are short-term changes in the system that show if the effort is on track. In the example described above, because water levels in rivers are difficult to connect to conservation efforts, the group’s intermediate indicator was “Per-Capita Water Use.” Such indicators are critical in situations where progress toward the ultimate goal happens very slowly and is influenced by many factors.

Reflection questions: Looking at the set of assumptions that link actions to outcomes, what causal connections do you have confidence in? Which are the most uncertain or unknown? Considering these questions helps target the rest of the discussion and identifies research that might be useful to improve the group’s confidence in the overall strategy.

2. Adding Feedback. By starting with the simple, one-way causal chain created in the first step, we can begin to identify important reinforcing or balancing feedback loops that the group’s actions may trigger. We start by looking for ways that the actions or results may get amplified through reinforcing loops. For example, as shown in the reinforcing loop in “Water Conservation Efforts,” success in a water conservation program could lead to public awareness of that success and positive word of mouth in the community, building public support and boosting the water utility effort even more. We then look for ways to strengthen that loop, for example, by writing editorials to the local newspaper to build the public’s awareness of the effectiveness of the water conservation program.

It is equally important to understand how the system can resist change or push back on the group’s effort through balancing loops. The balancing loop in “Water Conservation Efforts” shows how endeavors to introduce water conservation technologies in the Southwest of the United States were undermined by their own success. The implementation of conservation technologies for landscaping, indoor plumbing, and industry actually reduced water use. But because water availability was the primary limit to residential construction, reduced withdrawals meant that there was more water available to supply new development. New homes boosted the number of total water users, consuming most of the saved water and increasing total water use. This “compensating feedback” undid the positive effects of the overall effort and frustrated many advocates for water conservation.

Thus, the mapping revealed not only a possible problem that the team needs to address in the strategy, but also an important disconnect between the intermediate indicators — the amount of water saved through conservation efforts—and the long-term goal of improved stream flow and ecosystem health. In the Southwest, leaders have started to advocate for dedicating some fraction of saved water to increasing water levels in rivers.

Reflection questions: Are there any reinforcing loops that would amplify the effects of your actions? Can they be strengthened? Are there any balancing loops that cause the system to resist your efforts? Can they be weakened? Are there any feedback processes that are already trying to shift the system in the same direction that you are? Can you build on these?

3. Uncovering Critical Mindsets. People make decisions by evaluating information and incentives through the lens of their own assumptions and goals. Therefore, good strategies for changing systems must address both structures and mindsets in ways that reinforce each other. We have found it helpful to uncover relevant mental models in action-to-outcome mapping sessions by asking two questions:

• What are some assumptions that impede your actions from achieving the desired outcomes? (For example, “Water conservation means wimpy showers and half-flushed toilets!”)
• What are the mindsets that support your actions? (For example, “Wasting water is bad.”)

In the case of water use, many people hold the powerful mindset that “conservation is depravation.” The water policy movement thus worked to distance itself from “conservation” and instead spoke of improved “efficiency” in their marketing efforts.

Reflection questions: Are there ways to strengthen the supporting mindsets? Weaken the impeding ones?

4. Accounting for External Forces. Next we ask the group to think of other forces that may have an impact on outcomes. By doing so, we ensure that they work on the most important factor that may help or hurt their initiative. For example, in the water case, if overall environmental health is the goal of the water conservation effort, then the analysis in step 2 suggests that addressing regional population growth might be a high-leverage area to target. Other forces include agricultural water use, the policies of other regions, and global climate change. This listing of external forces, while sobering, helps the group see how its actions fit into a larger picture and prompts members to consider how they might influence any of the external factors. This step offers the chance to evaluate strategy with the widest possible lens.

Reflection questions: Should you be trying to influence any of the external forces that might affect your outcomes? If an external force seems to overwhelm your actions, is there a different set of actions you could take that could be more effective?

5. Looking for Opportunities for Learning and Action. Throughout the session, we keep running lists of questions and insights. The final step is to review the two lists and other notes to see what questions have cropped up and what potential supporting actions, new areas of focus, and further exploration are needed.

Our experience with the action-to-outcome process is that it helps an intact team explicitly map its thinking about how various actions will lead to desired outcomes, while taking into account the important feedback effects that can accelerate or slow progress. One client said that this methodology “sort of backs into system dynamics” by beginning with a team’s current strategies rather than with the behavior of the system. While action-to-outcome mapping does little to initially address the dynamic complexity in the system or uncover root-cause drivers of problems, it is effective in:

• Surfacing a team’s assumptions;
• Maintaining a focus on strategy;
• Explicitly including feedback and multiple effects in strategic thinking;
• Building causal maps when you don’t have extensive experience in diagramming.

Having seen groups use action-to-outcome mapping to improve their strategies on challenges ranging from urban sprawl to sustainable agriculture to air quality to inner-city poverty gives us hope that systems thinking can fulfill its promise of helping overcome the complex challenges of creating a more sustainable world.

Andrew Jones (apjones@sustainer.org) and Don Seville (dseville@sustainer.org) are project managers at Sustainability Institute, a consulting, training, and research center focused on social, economic, and environmental issues. 

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Three Planes

Mintzberg sees managing as “influencing action”; that is, helping organizations and units get things done. His model describes three planes that represent where managing takes place: the information plane, the people plane, and the action plane (see “Rules of Managing” on p. 10).

The Information Plane. According to Mintzberg, managers manage information to drive people to take action; they create budgets, set objectives, and so on. He thinks that most managers spent too much time on this plane, at

the expense of the people and action planes. Mintzberg is critical of what he calls “deeming,” where leaders impose targets in the absence of strategy. He states, “Some deeming is fine; management by deeming is not.” I agree with his premise that many leaders get caught in the trap of seeing their jobs as merely declaring or deeming “stretch goals” and then holding the organization accountable for achieving them.

The People Plane. When describing the people plane, Mintzberg states that “People are not driven so much as encouraged, often to ends they favor naturally.” This simple statement has many ramifications. For instance, encouragement may be praising, coaching, or simply truly understanding the circumstances of those you are leading. When Mintzberg states “to the ends they favor naturally,” he implies that managers need to ensure that the goals of the task are in alignment with the goals of the person being lead.

Many leaders get caught in the trap of seeing their jobs as merely declaring or deeming “stretch goals” and then holding the organization accountable for achieving them.

The Action Plane. On the action plane, managers “do on the inside” and “deal on the outside.” Mintzberg describes the “doing on the inside” role as “managing projects proactively and handling disturbances reactively.” For the “dealing on the outside” role, managers must mobilize support and conduct negotiations. According to the author, “Managers who don’t do and deal, and so don’t know what is going on, can become incapable of coming up with sensible decisions and robust strategies.” When leaders make decisions that leave you wondering, “What were they thinking?” it’s often because they are disconnected from the action plane.

10 Useful Points

A lot of management or leadership books focus on one competency or aspect. Managing provides a balance/ blending of many aspects. The book has key points in bold text, which makes it easy for time-constrained readers to quickly scan to items of importance and dive in where they find an interest. Here are 10 points I found particularly useful:

1. Much of a manager’s information is not verbal so much as visceral—seen and felt more than heard.
2. Managers help to bring out people’s natural energy.
3. Managers are gatekeepers and buffers in the flow of influence.

   Mintzberg characterizes five ways in which managers can get this role wrong:

4. Sieves allow external influences to create an environment in which individuals have to respond to a variety of pressures.
6. Dams are the opposite; they block external influences and disconnect the organization from the outside world.
7. Sponges absorb all the pressure and are at risk for burnout.
8. Hoses create a lot of pressure for those who support the organization from the outside.
9. Drips are the opposite; they don’t put enough pressure on outside supporters.
10. The pressures of managing are not temporary but perpetual.
11. Managing is no job to approach with hesitation; it requires too much of the total person.
12. Successful managers are flawed, as we all are. Fortunately, certain flaws are not fatal.
13. Managing contains many inescapable conundrums. (Chapter 5 documents these challenges and is worth the price of the book by itself). The conundrums of managing reminded me of the statement “describe in detail briefly.” Here are two I found particularly appealing:
    • The Action Conundrum. The Ambiguity of Acting describes the difficulty of making decisions in a world where there are a multitude of factors, all of which may be known with varying degrees of certainty. This reality often paralyzes leaders into not acting, while others seem to wait forever for information or data of limited value.
    • The Information Conundrum. The Dilemma of Delegating highlights the difficulty of delegating when information is “personal, oral and often privileged.” It is challenging to delegate when the context required for the task may not be available to the task recipient.
14. Readers of The Systems Thinker will appreciate the question:, “Do I have sufficiently powerful mental models of those things I must understand?” I like the question about mental models, because my experience has been that many leaders have an insufficient picture of the things they need to understand.
15. Effective managers are reflective: They know how to learn from their own experience; they explore numerous options; and they back off when one approach doesn’t work to try another.
16. Measure what you can, but then be sure to judge the rest, too: Don’t be mesmerized by measurement.

Effective managers are reflective: They know how to learn from their own experience; they explore numerous options; and they back off when one approach doesn’t work to try another.

True Managerial Effectiveness

If you are looking for the “three steps to … or the “five essential factors …” or the “eight ways to … ,” this book is not for you. But if you believe that you can always improve your management skills, then you’ll get a lot out of Managing. In particular, the self-study questions for managers in Chapter 6 are a powerful tool to improve your performance as a manager.

If you are a high-level leader, consider giving this book to your managers and then scheduling a monthly meeting where the group reviews a single chapter and discusses the important points and take-aways. Doing so might just help create true managerial effectiveness in your organization.

Dr. James T. Brown is president of a project management training company, SEBA Solutions Inc, and of a web-based provider of Professional Development Units (PDUs), OnePdu.com. He is author of The Handbook of Program Management, published by McGraw-Hill. For more information, contact Dr. Brown at jtbrown@sebasolutions.com.

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The assumption implicit in this tactic is that change is done to the organization, not by it. People must be convinced of the need for working differently and, if management does not clearly communicate the reasons for it, they will resist it. This model may work in situations where the shift involves introducing systems and processes that do not require a fundamental transformation of people’s attitudes, ways of seeing the world, and modes of working.

FAILING TO CHANGE

Leadership teams often rely on “telling and selling” large-scale change initiatives to the organization (B1). While this approach may initially seem successful, over the longer run, it undermines employees’ commitment to the change process (R2). The more successful tact would be to include employees from the beginning, what we might call the “engage and shape” approach (B3).

But unfortunately, as shown in “Failing to Change,” when instituting large transformational change initiatives, organizations often fall prey to a “Fixes That Fail” archetype. It begins when the leadership team uses the “tell and sell” approach to introduce a wholesale change of the way the organization does business (B1). They often promote these changes using newsletters, handy reference cards, posters, coffee mugs, and perhaps even a video. Workers initially seem enthusiastic, but over the longer term, fail to fully embrace the new routines (R2). In response, management looks for ways to strong-arm employees into adopting the change, an approach that usually dooms the initiative to failure.

So, is the instinct to communicate that underlies the “tell and sell” approach wrong? Of course not— how else can we achieve our goals except by passionately sharing them with others? But gaining employees’ genuine commitment requires a more authentic, interactive way of speaking and listening than we’ve practiced in the past. As shown in “Failing to Change,” the fundamental solution is for leaders to change how they communicate and what they communicate about (B3). They must work with employees to build a shared vision of the organization, its opportunities, and its challenges, as well as to plan a set of purposeful actions for creating the organization’s future. Only when employees have been included in the process and feel their ideas have been heard and respected will they embrace and contribute to the change. We might call this approach the “engage and shape” philosophy.

“Engage and Shape” Philosophy

As Gary Hamel points out in his work on strategy creation and core competencies, the way to unlock new ideas about an organization is to create conversations across boundaries that involve distinct experiential, technical, and philosophical perspectives. Through engaged conversation comes shared meaning. From shared meaning comes alignment of purpose and fundamental buy-in.

How can leaders effectively engage the workforce in sharing, exploring, and aligning their unique perspectives in order to contribute to the enterprise’s larger vision? The “engage and shape” philosophy offers a framework for understanding what is involved in the process. It starts with the following assumptions:

• Developing visioning skills throughout the organization is more effective than imposing a vision on the organization from above.
• Leaders can’t and shouldn’t have all the answers up front. But they must create the overall direction and allow employees to take the initiative forward in their own way.
• No one can predict the outcome of engaging employees and asking them to shape the future. Leaders will have to relinquish some control over the direction the change initiative takes if they wish to move from merely consulting employees (, “telling and selling”) to capturing their hearts and minds (, “engaging and shaping”).
• Change involves a long journey. We can have some idea about and therefore plan for the first leg of the journey, but it’s difficult to know what might be behind the first or second or fiftieth hill! The implication of this fact is that the planning process has to allow for emergence, agility, and course correction.
• Formal project management involves breaking down projects into components that can then be managed. But dynamic organizational and cultural change takes place in the complex interplay of components. Therefore, leaders need to adopt a holistic and systemic approach to managing that takes into account the complex whole.

Having productive conversations around organizational change is a key process in the “engage and shape” approach, but many managers do not have the patience or interest to develop skills in the discipline of dialogue. Nevertheless, the kind of conversation needed to effect transformational change doesn’t happen by magic. Good conversation involves a set of talking practices and people who can facilitate these conversations. It requires enough time to ensure sufficient alignment around why we need to change, what we should change into in order to secure certain outcomes, how we will go about achieving the change, and how we will handle the inevitable surprises and miscues that might come up during the process.

To make the shift to “engage and shape,” groups can follow a series of four conversational practices that guide the change process and serve as an entry point to a more comprehensive use of dialogue (see “Four Conversational Practices”). These practices provide hard-pressed, action-oriented, and outcome-focused managers with a way to manage conversations in the context of open-ended, less tightly planned but ultimately more transforming ways of achieving change.

FOUR CONVERSATIONAL PRACTICES

A series of four conversational practices can guide the change process and serve as an entry point to a more comprehensive use of dialogue. These practices provide hard-pressed, action-oriented, and outcome-focused managers with a way to manage conversations in the context of open-ended, less tightly planned but ultimately more transforming ways of achieving change.

Just recently, the Ministry of Defence in the United Kingdom used these practices to create high-performing integrated project teams for the acquisition and in-service support of military equipment. The team leaders became skilled practitioners in these tools and techniques, despite initial misgivings that this was “yet another change program that will surely go the way of all the others nowhere.” In a short time, they were able to show immediate benefits in terms of creating a new quality of involvement in and buy-in for the new process among staff members. The group ultimately achieved a series of stretch goals that might not have been possible otherwise.

Managing the Four Conversations

The key to achieving employee engagement in actively shaping change is to iteratively manage and follow a sequence of conversational steps. Before beginning, the group should discuss and decide on what kind of listening would be appropriate (see “Automatic vs. Generated Listening” on p. 4). At the same time, participants should agree to other, more familiar ground rules, such as every contribution is valid, let the speaker finish, suspend assumptions, and so forth.

Overall, the group will seek to explore and build on contributions rather than broadcast their own views in an unconnected way. When people compete to secure airtime, the resulting conversation remains superficial and does not build an evolving meaning. It is particularly important for more senior managers to listen to junior managers rather than correct them or talk over them. Likewise, the kind of decision-making that emerges should be consensual and inclusive.

Note that, when managing conversations about change in organizations, it’s important to clearly distinguish among the past, present, and future. If people are unable to see how their actions in the present are driven by their perceptions, and that their perceptions are created by their past experiences, they will be unable to create a distinctive future that is different from the past!

Conversation for Engagement and Alignment

Once the ground rules have been established, the first step in the change process is to identify and build shared commitment among team members by ensuring that everyone is mentally “in the same place.” Most important is to find out what people are currently committed to regarding the issue, purpose, or objective. In this instance, a commitment means a deeply held belief, an expectation about what should happen, or an explicit aim or purpose located in the future. Failing to openly discuss and acknowledge people’s current commitments means that they will emerge at a later stage and possibly undermine the progress made.

To conduct a conversation for engagement:

• Begin by encouraging participants to say what is on their minds, be it related to the issue at hand or something else. This activity is a way of getting people present in the room and encouraging everyone to speak.
• Surface everyone’s individual concerns in relation to the issue being addressed. Capture these on a flipchart to reexamine later in light of any joint commitment developed by the group to see how well it encompasses individual concerns. Take care to ensure that participants do not simply complain. If they do, try to bring to the surface the underlying causal expectation that the symptomatic complaint is based upon. Another caution is to avoid blame. Blame is based in the past, and any engagement or alignment must be founded on a commitment based in the future.
• Explore people’s commitments and capture them on a flipchart. Rarely do concerns or complaints exist without an underlying commitment to something; for example, complaints about a new change initiative may reveal team members’ underlying desire for senior leaders to recognize innovations already happening in the organization. The best way to begin to understand the differences and similarities in people’s perspectives, and to move to alignment, is to ask them to describe what the future outcome would be if the commitment were realized.
• Once all people’s current commitments have been surfaced, come to agreement on an overall commitment with regard to the issue. This process can be challenging. A helpful way of achieving alignment around what the group wants to achieve is to simply focus on the outcome, benefits, or value that they will create, ideally in measurable terms.

Managers often skip this phase because they don’t deem it “action oriented.” They also often believe that everyone already knows what the problem is; they just need to sort it out. But limiting the time spent or the quality of conversation will only restrict the achievement of the end result. Without engagement and alignment around an overall purpose, the group’s effort to explore possibilities for the future, evaluate their feasibility, and enact any plans will be half-hearted.

A conversation for engagement and alignment will often lead to a clear commitment to producing something that the group doesn’t have the faintest idea of how they will go about achieving. This is a healthy sign! The term given to this sort of commitment is “generating a stand.” A stand is a commitment to building a future that is demonstrated through everyday actions:

• It provides stability during turbulence.
• It allows the group to declare “breakdowns,” that is, instances when people’s words and actions are not based on realizing the stand. Team members should be free to point out to colleagues or their managers when they observe a “breakdown” that is not in service of the goal.
• It provides the basis for coaching and being coached.
• It represents a breakthrough from the past.

In our experience at the Ministry of Defence, the most successful teams were those that had strong alignment around a compelling stand. All other elements then tended to fall into place naturally. Typically, the stand would include high-level stretch targets as opposed to hard targets. Participants believed hard targets to be tough but achievable. Stretch targets, on the other hand, were deemed “over the horizon.” Their purpose was to provoke out-of-the-box thinking and unprecedented action.

In the Ministry of Defence, such stretch targets focused on the performance, time, and cost elements of procuring military equipment; for instance, procuring a new frigate and bringing it into service in half the time, for the same cost, but with greater capability than the current version. Even if a stretch target is not achieved, more often than not, committing to it ensures outcomes that are far greater than merely committing to a hard target. But in order to really commit to such a goal, employees need to participate in the planning process and trust that they won’t be penalized for falling short of what is a highly ambitious objective.

Conversation for Shaping the Future

This second conversational practice on the road toward breakthrough change involves imagining what things could be like in the future. When I worked with a client in the financial services industry, the aim was to transform the role of human resources into that of a true business partner. When the HR managers engaged in a conversation for shaping the future, they imagined a tomorrow in which the HR function genuinely influenced business results.

A key tool for this conversation, borrowed from Soft Systems Methodology, is the construction of a “root definition” for the activity that needs to be changed or addressed. A root definition is a structured description of a system that clearly spells out the activities that take place (or might take place) in the system being studied. It has three parts: what, how, and why. The “what” is the immediate aim of the system, the “how” is the means of achieving that aim, and the “why” is the longer-term aim of the purposeful activity.

Root definitions follow this format:

A system to ………………………… by ………………………… in order to ………………………….

For example, a root definition for creating breakthrough procurement performance at the Ministry of Defence might look like this:

In this root definition,

• The what is “to procure military equipment”;
• The how is “by using integrated project team processes and ways of working”; and
• The why is “to deliver the equipment within the budgets and time frames established at the outset of the project, ensuring enhanced capability to the military end users.”

This is one of many root definition that could be constructed for the activity of military procurement. The root definition should be internally consistent; for example, the “how” must describe a process which will (or should) result in the “what,” and so on. A common mistake is to include more than one purposeful activity in a single root definition.

Participants must also talk and think about the various roles that individuals and groups take on in the system. The categories (abbreviated as “CATWOE”) are:

• C (Customer): Who would be the victims/beneficiaries of the purposeful activity?
• A (Actors): Who would do the activities?
• T (Transformation Process): What would happen?
• W (Weltanschauung): A German word loosely meaning “worldview,” what view of the world makes this definition meaningful?
• O (Owner): Who could stop this activity?
• E (Environmental Constraints): What constraints in its environment does this system take as given?

For the root definition given above, the following is a possible “CATWOE”:

• C: Military end users
• A: Integrated project team (IPT)
• T: IPT processes and ways of working
• W: That multi-functional teams will be better at procuring military equipment than the current silo-based structure
• O: The Ministry of Defence
• E: The performance, time, and cost parameters set out at the start of the procurement

The process of trying out different transformation processes (T) and worldviews (W) in the discussion often promotes innovation. Ultimately, the task is to conclude this conversation with an agreement on one or two root definitions that can be taken forward into the next conversation.

Conversation for Feasibility

This step involves testing the possibilities and ideas developed in the conversation for shaping the future against key criteria, including:

• The original stand
• The feasibility of implementing the new ideas (how do the ideas compare with the current real world and what value will be created by implementing them?)
• The things that need to be in place in order to reach the stretch targets
• Initial plans for the early stages of the breakthrough journey and outline plans for the whole journey
• The projected return on investment

A useful technique in this conversation is to draw a conceptual model of the root definition on a big whiteboard. A conceptual model is a simple diagram showing the links between components of the designed future based on the ideas in the root definition (see “Conceptual Models” on p. 6). It is not a causal loop diagram in the conventional sense, because it is a representation of the future arising from the commitments and ideas flowing from the conversation.

The diagram shows the key activities described in the root definition and how they link together as a coherent system. Playing with different options and comparing them with the current reality helps to identify the benefits that might be derived from implementing the ideas captured in the root definition. Once again, this conversation is most effective when the previous conversations have been thoroughly explored and when participants:

• Listen generously and explore each others’ points of view
• Bring to the surface and challenge their assumptions
• Constantly check back to their original commitments and stands
• Are focused on the outcomes sought
• Try not to recreate the past

CONCEPTUAL MODEL

Conversation for Action

The aim of the conversation for action is to bring to life the conceptual model identified in the previous conversation. This step is critical; unfortunately, managers seldom conduct these conversations well. The principles behind a conversation for action fall into two categories:

1. Participants must make requests of other people.

Here it’s important to be explicit about who is having the request made of them, what is being requested, and by when. The individuals who are having requests made of them have three possible responses:

• Accept the request.
• Reject the request.
• Make a counterproposal, that is, undertake the requested action but on a different timetable or propose a different action.

2. Participants can choose to make promises to other people by offering to do something specific by a particular date.

Although this process seems simple and straightforward, think back to management meetings that have failed to result in meaningful actions. Nearly always, people fail to follow up because team members haven’t rigorously handled conversations for action. This oversight often occurs because the group suffers from a lack of commitment, honesty, or trust. For instance, people may attend meetings because they do not want to miss out on anything, but when the group agrees to do something, no one assumes responsibility for taking it forward.

This conversational discipline brings clarity to the “something” as well as a genuine commitment to taking it forward. The final step is to identify accountability for different tasks. Participants will have developed high levels of trust because they have all been involved in the rigor of the previous conversational steps. The will all be on the same page regarding what they want the outcome to be. If any or all of the previous three stages have been handled in an incomplete way, the conceptual model will remain just that, conceptual.

Application of the Disciplines

At the Ministry of Defence, breakthrough change has been achieved in an environment that had previously been hostile to innovations. One hundred and fifty integrated project teams (IPTs), employing some 5,000 staff members, were established over an 18-month period. This process in itself was seen as a major success, particularly in light of team members’ alignment around robust plans. Many IPTs have already achieved their hard targets, and a significant number have made good progress toward their stretch targets. The UK National Audit Office has highlighted this case as an example of successful change.

Leading change is about adding value to the business by engaging people in finding new ways to operate. The only effective way to draw people into the process is to improve the quality of our speaking and listening. It is through improved conversation that aligned action takes place. In this sense, language is indeed the house of being and doing. The techniques described here are a good way to start improving the quality of our conversations for business benefit.

Robert Bolton is a director of Atos Origin Consulting, formerly KPMG Consulting in the United Kingdom. He specializes in transformational change in the UK public sector, particularly in the area of defense. He is also a visiting lecturer in strategic change at the University of Bristol.

The post Talking Change: Developing Conversational Discipline for Breakthrough Performance appeared first on The Systems Thinker.

Twenty-five hundred years ago it might have been said that man understood himself as well as any other part of his world. …Today he is the thing he understands least. Physics and biology have come a long way, but there has been no comparable development of anything like a science of human behavior. … Aristotle could not have understood a page of modern physics or biology, but Socrates and his friends would have little trouble in following most current discussions of human affairs.

Consider the contrast between great advances during the last century in understanding technology and the relative lack of progress in understanding economic and managerial systems. Why such a difference? Why has technology advanced so rapidly while social systems continue to exhibit the same kinds of misbehavior decade after decade? I believe the answer lies in failing to recognize that countries and corporations are indeed systems. There is an unwillingness to accept the idea that families, corporations, and governments belong to the same general class of dynamic structures as do chemical refineries and autopilots for aircraft. To admit the existence of a social system is to admit that the relationships between its parts have a strong influence over individual human behavior.

The idea of a social system implies sources of behavior beyond that of the individual people within the system. Something about the structure of a system determines what happens beyond the sum of individual objectives and actions. In other words, the concept of a system implies that people are not entirely free agents but are substantially responsive to their surroundings.

We change laws, organizational forms, policies, and personnel practices on the basis of impressions and committee meetings, usually without any dynamic analysis.

To put the matter even more bluntly, if human systems are indeed systems, it implies that people are at least partly cogs in a social and economic machine. People play their roles within the totality of the whole system, and they respond in a significantly predictable way to forces brought to bear on them by other parts of the system. This is contrary to our cherished illusion that people freely make their individual decisions. I suggest that the constraints implied by the existence of systems are true in real life. As an example, we see the dominance of the political system over the individual in the evolution of the Federal budget deficit. Every presidential candidate since 1970 has campaigned with the promise to reduce the federal deficit. But the deficit has on the average doubled every four years. The social forces, rather than the president, have been controlling the outcome. How to harness those social forces has not been effectively addressed.

Designing Managerial and Social Systems

In designing an engineering system such as a chemical plant, engineers realize that the dynamic behavior is complicated and that the design cannot be successfully based only on rules of thumb and experience. There would be extensive studies of the stability and dynamic behavior of the chemical processes and their control. Computer models would be built to simulate behavior before construction of even a pilot plant. Then, if the plant were of a new type, a small pilot plant would be built to test the processes and their control.

But observe how differently social systems are designed. Although political, economic, and managerial systems are far more complex than engineering systems, only intuition and debate have ordinarily been used in building social systems. We change laws, organizational forms, policies, and personnel practices on the basis of impressions and committee meetings, usually without any dynamic analysis adequate to prevent unexpected consequences.

“Designing” social systems or corporations may seem mechanistic or authoritarian. But all governmental laws and regulations, all corporate policies that are established, all computer systems that are installed, and all organization charts that are drawn up constitute partial designs of social systems. Such redesigns are then tested experimentally on the organization as a whole without dynamic modeling of the long-term effects and without first running small-scale pilot experiments. For example, bank deregulation and the wave of corporate mergers in the 1980s constituted major redesigns of our economy with inadequate prior consideration for the results. All systems within which we live have been designed. The shortcomings of those systems result from defective design, just as the shortcomings of a power plant result from inappropriate design.

Effects of Feedback Structure

The feedback structure of an organization can dominate decision making far beyond the realization of people in that system. By a feedback structure, I mean a setting where existing conditions lead to decisions that cause changes in the surrounding conditions, that influence later decisions. That is the setting in which all our actions take place.

OPEN-LOOP IMPRESSION OF THE WORLD

The prevailing view is that the world is unidirectional—a problem leads to an action that leads to a solution.

We do not live in a unidirectional world in which a problem leads to an action that leads to a solution. Most discussions, whether in board meetings or cocktail parties, imply a structure which suggests that the world is unidirectional, that the problem is static and we need only act to achieve a desired result (see “Open-Loop Impression of the World”).

CLOSED-LOOP STRUCTURE OF THE WORLD

In reality, we live in an ongoing circular environment in which each action is based on current conditions, such actions affect conditions, and the changed conditions become the basis for future action.

Instead, we live in an ongoing circular environment in which each action is based on current conditions, such actions affect conditions, and the changed conditions become the basis for future action (see “Closed-Loop Structure of the World”). There is no beginning or end to the process. People are interconnected. Through long, cascaded chains of action, each person is continually reacting to the echo of that person’s past actions as well as to the past actions of others.

In general, social systems carry a set of common characteristics:

• Most difficulties are internally caused, even though there is an overwhelming and misleading tendency to blame troubles on outside forces.
• The actions that people know they are taking, usually in the belief that the actions are a solution to difficulties, are often the cause of the problems being experienced.
• The very nature of the dynamic feedback structure of a social system tends to mislead people into taking ineffective and even counter-productive action.
• People are sufficiently clear and correct about the reasons for local decision making—they know what information is available and how that information is used in deciding on action. But people often do not understand correctly what overall behavior will result from the complex interconnections of known local actions.

Jay W. Forrester is Professor Emeritus at the Massachusetts Institute of Technology and former director of the MIT System Dynamics Group, and is the founder of the field of system dynamics. Since his retirement in 1989, he has worked toward bringing system dynamics into schools as the basis for a new kind of education.

Part two of this article is available by clicking here.

The post The Next Great Frontier: Designing Managerial and Social Systems (Part 1) appeared first on The Systems Thinker.