© dr kelvyn youngman, apr 20141 systems & structure let’s start by looking at a part of a...

© Dr Kelvyn Youngman, Apr 2014 1

Systems & Structure

Let’s start by looking at a part of a system; it’s composed of two individuals, Bob and Sue …

SueBob


Systems & Structure

… and they are part of a production department or a project team

SueBob

Department/Team


Systems & Structure

Or they could be members of a sports team if that is more familiar to you

SueBob

Department/Team


Systems & Structure

We recognise that there is often a synergy between members of a team such that a team member’s output exceeds that of the individual member in isolation

SueBob

Department/Team

Synergy


Systems & Structure

There is an interrelationship that comes about from working together such that Sue’s skills enhances Bob’s work and Bob’s skills enhances Sue’s work …

SueBob

Department/Team

Synergy


Systems & Structure

… even though they may be skilled in very different domains

SueBob

Department/Team

Synergy


Systems & Structure

And although each member is a discrete, disparate, individual, forming an aggregate collection of people in an unstructured team …

SueBob

Department/Team

Synergy


Systems & Structure

… their individual output is structured and transformed by their interdependency, their interrelationship, with each other

SueBob

Department/Team

Synergy


Systems & Structure

The interrelationship is irreducible, we don’t know where it starts or where it leaves off, it is subconscious, taken for granted, mostly tacit rather than explicit

SueBob

Department/Team

Synergy


Systems & Structure

SueBob

Department/Team

Synergy

We can easily swap people in or out, but to do so changes the interrelationships, it changes the output – often in a way that we can not tell


Systems & Structure

Moreover, the output of the whole team is a synergy of all of the interrelationships between all of the members of the team

SueBob

Department/Team

Synergy


Systems & Structure

So, now, let’s also consider Jan and Max; two more individuals …

SueBob

Department/Team

Jan Max

Synergy


Systems & Structure

… and as you may have guessed, arising from a different production department or a different project team

SueBob

Department/Team

Jan Max

Different Department/Team

Synergy


Systems & Structure

And once again there is a synergistic relationship between the members of the team, but there is something more than that too …

SueBob

Department/Team

Jan Max


Synergy Synergy


Systems & Structure

… there is now, also, an interrelationship between these two departments or teams as well …

SueBob

Department/Team

Jan Max


Synergy Synergy


Systems & Structure

… and that in turn gives rise to a further synergy at the level of the firm or of the project

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy


Systems & Structure

The synergy that arises is emergent from the integration of the parts

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy


Systems & Structure

The whole has properties that none of the parts have, and the parts acquire properties that they do not have in isolation

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy


Systems & Structure

The synergy is contingent upon the potential within the partsand it is contingent upon their past

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy


Systems & Structure

The integration of the parts arises from the transformation from unstructured and independent individuals to their structured and interdependent work

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy

Interrelationships are interdependencies


Systems & Structure

Now be careful! There are two domains operating in the same space and we tend to confuse these – and ourselves in the process

SueBob

Department/Team

Jan Max


Firm/Project

Synergy Synergy

Synergy


Systems & Structure

One domain, the domain of independence, is the domain of the whole

SueBob

Department/Team

Jan Max


Firm/Project

Independence Independence

Independence


Systems & Structure

It is also the domain of simplicity; as we move closer and closer towards the integrative whole two things happen …

SueBob

Department/Team

Jan Max


Firm/Project

Independence& Simplicity




Systems & Structure

… firstly the whole is more and more comprehensive, it encompasses more and more things …

SueBob

Department/Team

Jan Max


Firm/Project





Systems & Structure

… secondly the time span becomes longer and longer, the short-term is replaced by the intermediate-term, which is replaced by the longer-term

SueBob

Department/Team

Jan Max


Firm/Project





Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project




The net effect is, that within the encompassing whole, cause and effect is pretty much local, it is within the time span of control, and it is linear


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project




It is simple in other words


Systems & Structure

The other domain, the domain of interdependence, is the domain of the parts

SueBob

Department/Team

Jan Max


Firm/Project

InterdependenceInterdependence

Interdependence


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project

Complexity &Interdependence



It is also the domain of complexity; as we move further and further away from the integrative whole two things happen …


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project




… firstly each part is less and less comprehensive, it encompasses fewer and fewer things …


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project




… secondly the time span becomes shorter and shorter, the longer-term is replaced by the intermediate-term, which is replaced by the short-term


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project




The net effect is, that within the limiting part, cause and effect now becomes distant in time and place and less and less linear


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project




It becomes complex


Systems & Structure

It seems that we have a two-way street; on the one hand we have an emergent simplicity or synergy that we do want …

SueBob

Department/Team

Jan Max


Firm/Project

Emergence& Simplicity




Systems & Structure

… and on the other hand; we also seem to have a perplexing and submergent complexity that we do not want

PartPart

Department/Team

Part Part


Firm/Project

Emergence & Complexity

Emergence& Complexity

Emergence& Complexity


Systems & Structure

So, let’s have a closer look at this thing that we call complexity

SueBob

Department/Team

Jan Max


Firm/Project

Complexity Complexity

Complexity


Systems & Structure

It comes in two flavours – dynamic complexity and detail complexity, although they are really just different aspects of the same thing

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

What if Bob’s work is essentially first, then he hands it over to Jan, and Jan to Sue, and Sue to Max; this is the dynamic complexity

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

We say that it is complex because effect is not experienced at the same time nor in the same place as the cause – and usually it is non-linear too …

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

… for example what if Sue is working on another urgent job when the work comes to her from Jan – ever seen that happen?

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

Or Jan was late, and Sue was waiting, so she started something else

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

Now, what if Bob makes an “error” which is not picked up until it gets to Max – that’s not entirely unheard of either – right? In fact this is detail complexity

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

SueBob

Department/Team

Jan Max


Firm/Project


Complexity

We say that it is complex because effect is at the end, cause is at the start, and it is non-linear because all hell is about to break loose!


Systems & Structure

Detail and dynamics are always interrelated; by analogy, the ingredients selected in a recipe determine the type of cooking method required …

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

… and vice versa the cooking method selected will determine the type of ingredients that are required

SueBob

Department/Team

Jan Max


Firm/Project


Complexity


Systems & Structure

So we have a paradox; the transformation via interdependency gives us both synergy which we want and complexity which we don’t want

SueBob

Department/Team

Jan Max


Firm/Project

SynergyComplexity

SynergyComplexity

SynergyComplexity


Systems & Structure

But it is worse than that too …

SueBob

Department/Team

Jan Max


Firm/Project

SynergyComplexity

SynergyComplexity

SynergyComplexity


Systems & Structure

… we actually destroy our emergent synergies and we enhance the submergent complexity – all with the very best of intents!

SueBob

Department/Team

Jan Max


Firm/Project

SynergyComplexity

SynergyComplexity

SynergyComplexity


Systems & Structure

How on earth is it that do we do that?

SueBob

Department/Team

Jan Max


Firm/Project

SynergyComplexity

SynergyComplexity

SynergyComplexity


Systems & Structure

Well, we see ourselves as individuals, and quite naturally also as independent wholes, rather than as the interdependent parts of a larger whole

SueBob

Department/Team

Jan Max


Firm/Project

SynergyComplexity

SynergyComplexity

SynergyComplexity


Systems & Structure

The consequence is that we begin to try to break apart and to better understand the wholes which we should have realised are in fact irreducible

SueBob

Department/Team

Jan Max


Firm/Project

Deconstruction Deconstruction

Deconstruction


Systems & Structure

WasteWaste

Capacity

Waste Waste

Capacity

Performance


Deconstruction

We look for waste to reduce rather than for emergent capacity to create …


Systems & Structure

CostCost

Cash Inflow

Cost Cost

Cash Inflow

Performance


Deconstruction

… or we look for costs to reduce rather than ways to improve cash inflow …


Systems & Structure

EfficiencyEfficiency

Effectiveness

Efficiency Efficiency

Effectiveness

Performance


Deconstruction

… or we look at our local efficiency rather than our overall effectiveness


Systems & Structure

EfficiencyEfficiency

Effectiveness

Efficiency Efficiency

Effectiveness

Performance


Deconstruction

In fact there is no end to this deconstruction as we move our attention from the parts to the subparts, ISO 9000, make-work, and economic stagnation


Systems & Structure

OptimizeOptimize Optimize Optimize


Deconstruction

In our efforts to deconstruct our problem into smaller and smaller and more and more understandable parts we seek to ultimately optimize every part


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

However the outcome is to sub-optimise the whole!


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

For example; when we optimise security around each local condition wesub-optimize the security of the whole upon which our security depends …


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

… or when we optimise safety time around each local condition we sub-optimize the safety-time of the whole and most things are late …


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

… or when we optimise accounting “profit” for each local condition we sub-optimize the overall profit of the whole system upon which we depend


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

We isolate ourselves in silos instead of interacting with each other


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

We compete with “them” rather than collaborating – even though they are on “our” side


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

When we operate in this manner we increase the submergent complexity and we destroy the emergent synergy – the inherent simplicity


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

Because this is so “normal” we are hardly even aware of the fact


Deconstruction


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

ConstructionDeconstruction

We need to construct a whole from the parts, not deconstruct the parts from the whole




Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

We need to learn to search for the emergent whole of which we are a part, and not the subsidiary parts of which we are the whole





Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

Instead of spiralling in and downwards with analytical precision, we must spiral out and upwards, the radius of the turns increasing as the spiral rises





Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

We should be searching for ever better integration of the parts; through novel rearrangement of existing ones and the discovery of unexpectedly new ones





Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize




How then do we do that?


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

Well, in a word or two – we must search out for the common good

Common Good Common Good

Common Good


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

Common good is the key that allows for structural interdependency to operate in a self-regulating manner


Common Good


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

The system is then able to operate under the dual authority of the whole and of the parts; they inform one another


Common Good


Systems & Structure

OptimizeOptimize

Sub-optimize

Optimize Optimize

Sub-optimize

Sub-optimize

Now let’s see if we can use this to extract ourselves from our sub-optimization


Common Good


Systems & Structure

PartPart

Whole

Rate Limiting Part

Rate Limited

Rate Limited


Common Good

In any social-systemic or socio-economic system there will be, for any number of reasons, such as incremental capacity issues, a rate limiting step …


Systems & Structure

… a constraint …

PartPart

Whole

Constraint Part

Constrained

Constrained


Common Good


Systems & Structure

… such that as a team we can never run faster than the slowest member and we have a chain of performance from the slowest part to the larger whole

PartPart

Whole

Constraint Part

Constrained

Constrained


Common Good


Systems & Structure

… this can be either concrete or it can be abstract

PartPart

Whole

Constraint Part

Constrained

Constrained


Common Good


Systems & Structure

Everything else, 3/4 of the parts in this simple illustration, and more like 19 out of 20 in real life, are non-constraints and they are non rate-limiting

Non-constraintNon-constraint

Non-constrained

Constraint Non-constraint

Constrained

Constrained


Common Good


Systems & Structure

We have to exploit the optimality of the singular rate-limiting step in order to exploit the optimality of the larger whole …


Non-constrained

Optimize Non-constraint

Optimized

Optimized


Common Good


Systems & Structure

… think about it, we have to optimize just one thing


Non-constrained


Optimized

Optimized


Common Good


Systems & Structure

Not everything, just one thing


Non-constrained


Optimized

Optimized


Common Good


Systems & Structure

But we do have to super-optimize everything else

Super-optimizeSuper-optimize

Super-optimized

Optimize Super-optimize

Optimized

Optimized


Common Good


Systems & Structure

Not optimize, but super-optimize, in fact they are already so, but we must continue to maintain and to improve upon this


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure

Can you see how much this is contrary to our deconstructionist proclivities?


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure

These parts must self-regulate, subordinate, to the optimal rate, even though they can do much better


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

This self-regulation drives a number of non-intuitive outcomes


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

They are non-intuitive because of our lack of expertise with interdependency and our all too common and erroneous assumption of independency


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

For example; the later you put work into such a project or process the sooner it will come out …


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

… or the more inefficient the process the faster the work will be completed …


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

… or some of the least profitable items will produce the best cash inflow …


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

… or the higher up the hierarchy the greater your capability must be, but the more simple the system is


Systems & Structure

In the broadest sense, these are the sorts of emergent potential that we can expect; things are better, sooner, and faster


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure

Old outputs can be improved and new outputs can be developed


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure

Kaizen & Kaikaku have been teaching this to us “concrete heads” for more decades than we care to acknowledge


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure

We must create time to create additional capacity and capability, so that we can create even more time such that the initial time can be converted to value!


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure

Western models of Kaizen never explain this

Value Space100% - $$


Systems & Structure

Takeshi Kawase, emeritus professor of engineering from Keio, does explain this

Value Space100% - $$


Systems & Structure

We have to make time – a headspace – to discover & develop new capacity and capability yet preserving the current output – productivity must improve

Value Space80% - $$

Headspace 20%


Systems & Structure

Arguing the other way, if we improve productivity then we have time to invest in developing new capacity and capability

Value Space80% - $$

Headspace 20%


Systems & Structure

The new capacity and capability appears first as additional headspace(no pun intended) and productivity must improve even more

Value Space70% - $$

Headspace 20%

Headspace 10%


Systems & Structure

Then we transfer the new capacity and capability to produce additional value

Value Space80% - $$$

Headspace 20%


Systems & Structure

The value is not exaggerated because it is marginal gain


Headspace 20%


Systems & Structure

And we start again in our search for more, or better, or novel …


Headspace 20%

Headspace 10%


Systems & Structure

… and then we transfer that too

Value Space80% - $$$$

Headspace 20%


Systems & Structure

All of the time we are building value


Headspace 20%


Systems & Structure

This is a cash machine


Headspace 20%


Systems & Structure

This is a cash machine too


Super-optimized


Optimized

Optimized


Common Good


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

We must create capacity and capability for when it is needed and we must preserve and protect it when it is not needed


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

The creation of additional capacity and emergent capability is vastly, vastly, underrated in Western economic thinking


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

It is only through the existence of such capability, such potential, that new possibilities can emerge


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

But in order to capitalize on this we must attend to the one last thing that is stopping us from this realisation – our current constraint


Systems & Structure


Super-optimized


Optimized

Optimized


Common Good

The next step, elevation in our terms, occurs when can apply this super-optimizing rule to all parts, when we have the socio-economic capital to do so


Systems & Structure


Super-optimized

Super-optimize Super-optimize

Super-optimized

Super-optimized

When we can super-optimize all of the parts, then we can super-optimizethe whole as well


Common Good


Systems & Structure


Super-optimized


Super-optimized

Super-optimized

This is exactly how organic systems work, this is exactly how other social systems work, it should be how our socio-economic systems work too


Common Good


Systems & Structure


Super-optimized


Super-optimized

Super-optimized

In summary …


Common Good


Systems & Structure


Super-optimized


Super-optimized

Super-optimized

When we fail to understand the structural transformation that occurs through interdependency, we create organisations that are anti-requisite and fragile …


Common Good


Systems & Structure


Super-optimized


Super-optimized

Super-optimized

We have patriarchy and subjugation, isolation and competition, distrust, and an underlying sense of insecurity and dissatisfaction


Common Good


Systems & Structure


Super-optimized


Super-optimized

Super-optimized

When we understand the structural transformation that occurs through interdependency, we create organisations that are requisite and anti-fragile …


Common Good


Systems & Structure


Super-optimized


Super-optimized

Super-optimized

We have partnership and subordination, interaction and collaboration, trust, and an underlying sense of security and satisfaction


Common Good


End

Website: www.dbrmfg.co.nz

E mail: youngman“at”dbrmfg.co.nz

© dr kelvyn youngman, apr 20141 systems & structure let’s start by looking at a part of a...

Documents

dr kelvyn youngman

sue suebob slide

interdependencies slide

team members output

sports team

domain of independence

domain of simplicity

individual output