Monday, September 8, 2008

Senge’s Arch-e-types

No pun intended. Peter Senge’s ideas of the learning organization and systems thinking which revolutionized the discipline as well as the practitioners of management, created a space in every scientific mind with the aches of his archetypes. His book, The Fifth Discipline, describes these archetypes, through arches in Influence diagrams, in so lucid a manner that the ‘-e-‘ connection with that of literary works in Islam is noticeable.

Senge’s systems archetypes show us phenomena that exist very commonly in our systems but we miss them with equal ease. In this blog, I will discuss four of the most common nine archetypes that he has introduced. The focus as we go through his archetypes should be on what we, the tribe of managers, can take home.

1.    1. Balancing Process With Delay

Often the systems we deal with responds to our actions but with a delay. The issue arises when we are not aware of the delay. Of course we may take corrective action after the system has responded fully but our corrective actions will again take time to show effects with a delay. But, how do we know our system-in-focus belongs to this archetype? An easy way is we think we are on the right track and with gradual change we find that our track has changed. An example of such a system is shown in the figure below, where the heater adjusts the water temperature with a delay, say of 15 seconds. But as we do not receive any hot water for 15 seconds, we do not turn the heater off any sooner. And after 15 seconds, the temperature of water is much higher than what we can take. We would not have committed the error of keeping the heater on for 15 seconds if we knew of the delay in its response.



We often encounter this archetype in macroeconomics, which is why RBI waits for at least four months to evaluate the effectiveness of a monetary policy. Fiscal policies have even a longer time lag.

The take away for managers, in the words of Peter Senge is, “Either be patient or make the system more responsive”


 2. Shifting the Burden

This explains the behavior of organizations that are too preoccupied with achieving targets and solving the problem fast so that they end up using the symptomatic quick fix way. However, as the system starts stabilizing through the use of the symptomatic solution, its effectiveness reduces but due to easy results, the people stop taking the more fundamental but longer path. A very relevant such system is presented in www.threesigma.com/systems_primer.htm :


Image Source www.threesigma.com/systems_primer.htm


The result is an over reliance on the quick solution and diminished capacity for the long-term solution.”

The lesson for managers, by Senge, is to use symptomatic solution if it is imperative as delays occur in the fundamental solution to start working. However, he says that the use of the former should be strictly used to buy time while we are at work on the fundamental one.

 

3. Success to the Successful



Image Source : http://agencyspy.wordpress.com/2008/01/24/the-boys-club-says-bye-bye-to-boost/

In this archetype, a common resource is being shared by two, while the control is with a third party who wants the highest utility out of the resource. More the success of one of the two, more is the allocation of the resource to her; while the second one loses right to it. As the allocation of resource reduces for the less successful, her performance also falls thereby making the former even more successful.

This happens with organizations that follow ICAM for allocation of funds – the more successful an SBU is, more is the funds doled out to it and even more successful it becomes due to fund sufficiency.

Senge’s advice to managers in this case is to achieve a balanced output from both the choices - “break or weaken the coupling the two entities competing for the limited resource so that unhealthy competition for resources is not encouraged”.

 

4. Growth and Under-investment

Corporations are victims to the Sigmoid curve. In order to lift the limit on growth, an organization should undertake the path of capacity expansion. However, the very nature of the investment required pushes back the incentive to invest – “the investment must be aggressive and sufficiently rapid to forestall reduced growth”, in the words of Senge. Thus, organizations find ways to under-invest – they lower the performance metrics. 

The take home for managers in these situations according to Senge is, “if there is a genuine potential for growth, build capacity in advance of demand, as a strategy for creating demand”. The vision for the growth should be held onto through development of challenging performance standards.  

Having read through the systems archetypes, the simplicity with which Senge has captured the important systems characteristics through influence diagrams amazes me. No wonder his book, The Fifth Discipline has found so wide a reach. However, planning in organizations has moved ahead of the imperative study of systems. We talk of creating the system today; however, doing so will not be possible until we have sufficient knowledge of how systems behave. His archetypes build a strong foundation in every corporate planner.

 

Reference

Senge, Peter M.(1990). The Fifth Discipline : The Art & Practice of The Learning Organization. USA: Doubleday Currency


2 comments:

Tania said...

Archetypes of Peter Senge are highly useful yet common sensical. It is good that as students of CP we are reading about them.

Anonymous said...

'Systems Archetypes are helpful but they have lost the charm in the 21st century because a few planners think Senge was too good with systems but poor on simulating real-time corporate issues'