THE SYSTEMS THINKING AS THE CORE OF PRINCIPLES OF LEARNING ORGANIZATION

Journal of Information, Control and Management Systems, Vol. 8, (2010), No. 1 93 THE SYSTEMS THINKING AS THE CORE OF PRINCIPLES OF LEARNING ORGANIZATION Jaroslava ŠTAFFENOVÁ University of Žilina, Faculty of Management Science and Informatics, Slovak Republic e-mail: Jaroslava.Staffenova@fri.uniza.sk Abstract This article is focused on the systems thinking as the core of principles of learning organization. The five disciplines of learning organization are fundamental to effective change. People in the learning organization should work closely and find synergy in teams because a team is more powerful than the sum of individuals. System thinking allows the organization to change in the areas where the highest payoff can be reaped and develop the platform to sustain change. Keywords: systems thinking, learning organization, personal mastery, shared vision, team learning, mental models, procedure, process, system. 1 INTRODUCTION From a very early age, we are taught to break apart problems, to fragment the world. This apparently makes complex tasks and subjects more manageable, but we pay a hidden, enormous price. We can no longer see the consequences of our actions; we lose our intrinsic sense of connection to a larger whole. When we then try to "see the big picture," we try to reassemble the fragments in our minds, to list and organize all the pieces. But, the task is futile - similar to trying to reassemble the fragments of a broken mirror to see a true reflection. Thus, after a while we give up trying to see the whole altogether. [1] The five disciplines, that distinguish every organization from innovate learning organization are: Systems thinking - we tend to think that cause and effect will be relatively near to one another. Thus when faced with a problem, it is the solutions that are close by that we focus upon. We look to actions that produce improvements in a relatively short time span. Personal mastery - is the discipline of continually clarifying and deepening our personal vision. People with a high level of personal mastery live in

94 The Systems Thinking as the Core of Principles of Learning Organization a continual learning mode. People with a high level of personal mastery are acutely aware of their ignorance, their incompetence, and their growth areas. Mental models it is necessary for people to learn new skills and develop new orientations. Entrenched mental models thwart changes that could come from systems thinking. In other words it means fostering openness. It also involves seeking to distribute business responsibly far more widely while retaining coordination and control. Shared vision - when there is a genuine vision, people excel and learn, not because they are told to, but because they want to. But many leaders have personal visions that never get translated into shared visions that galvanize an organization. Visions spread because of a reinforcing process. Increased clarity, enthusiasm and commitment rub off on others in the organization. Team learning - the discipline of team learning starts with dialogue, the capacity of members of a team to suspend assumptions and enter into a genuine thinking together. When dialogue is joined with systems thinking, there is the possibility of creating a language more suited for dealing with complexity, and of focusing on deep-seated structural issues and forces rather than being diverted by questions of personality and leadership style. 2 SYSTEMS THINKING Systems thinking offers you a powerful new perspective, a specialized language, and a set of tools that you can use to address the most stubborn problems in your everyday life and work. Systems thinking is a way of understanding reality that emphasizes the relationships among a system's parts, rather than the parts themselves. Based on a field of study known as system dynamics, systems thinking has a practical value that rests on a solid theoretical foundation. One of the major breakthroughs in understanding the complex world of organizations is the field of systems theory. The field studies systems from the perspective of the whole system, its various subsystems and the recurring patterns in the relationships between the subsystems. Systems theory has greatly influenced how we understand and change organizations. The application of this theory is called systems analysis. One of the major tools of systems analysis is systems thinking. Basically, systems thinking is a way of helping a person to view systems from a broad perspective that includes seeing overall structures, patterns and cycles in systems, rather than seeing only specific events in the system. This broad view can help you to quickly identify the real causes of issues in organizations and know just where to work to address them. Systems thinking has produced a variety of principles and tools for analyzing and changing systems. By focusing on the entire system, consultants can attempt to identify solutions that address as many problems as possible in the system. The positive effect of those solutions leverages improvement throughout the system. Thus, they are called

Journal of Information, Control and Management Systems, Vol. 8, (2010), No. 1 95 leverage points in the system. This priority on the entire system and its leverage points is called whole systems thinking. The major priority is recognizing the interaction between a system and its external environment. The model, in conjunction with whole systems thinking, is a powerful means to analyzing and changing systems. Systems theory has evolved to another level called chaos theory. In this context, chaos does not mean total confusion. Chaos refers to the dynamics of a system that apparently has no, or little, order, but in which there really is an underlying order. In these systems, small changes can cause complex changes in the overall system. (In technical terms, chaos theory applies to complex non-linear dynamics systems.) Chaos theory has introduced new perspectives and tools to study complex systems, such as biological, human, groups, weather, population growth and the solar system. Note that systems theory and systems thinking are not the same as being systematic. In the context of a consulting project, systematic is about setting goals, collecting and analyzing feedback about status of achievement of goals, and then adjusting activities to achieve the goals more effectively. Systems thinking is valuable because it can help you design smart, enduring solutions to problems. In its simplest sense, systems thinking gives you a more accurate picture of reality, so that you can work with a system's natural forces in order to achieve the results you desire. It also encourages you to think about problems and solutions with an eye toward the long view for example, how might a particular solution you're considering play out over the long run? And what unintended consequences might it have? Finally, systems thinking is founded on some basic, universal principles that you will begin to detect in all areas of life once you learn to recognize them. 2.1 Systems Thinking as a Special Language As a language, systems thinking has unique qualities that help you communicate with others about the many systems around and within us: It emphasizes wholes rather than parts, and stresses the role of interconnections -including the role we each play in the systems at work in our lives. It emphasizes circular feedback (for example, A leads to B, which leads to C, which leads back to A) rather than linear cause and effect (A leads to B, which leads to C, which leads to D,... and so on). It contains special terminology that describes system behavior, such as reinforcing process (a feedback flow that generates exponential growth or collapse) and balancing process (a feedback flow that controls change and helps a system maintain stability).

96 The Systems Thinking as the Core of Principles of Learning Organization 2.2 Systems Thinking as a Set of Tools The field of systems thinking has generated a broad array of tools that let you graphically depict your understanding of a particular system's structure and behavior, communicate with others about your understandings, and design high-leverage interventions for problematic system behavior. These tools include causal loops, behavior over time graphs, stock and flow diagrams, and systems archetypes - all of which let you depict your understanding of a system - to computer simulation models and management "flight simulators," which help you to test the potential impact of your interventions. Whether you consider systems thinking mostly a new perspective, a special language, or a set of tools, it has a power and a potential that, once you've been introduced, are hard to resist. The more you learn about this intriguing field, the more you'll want to know! 3 SYSTEMS AND PROCESSES 3.1 Systems A system is a collection of objects such as people, resources, concepts, and procedures intended to perform an identifiable function or to serve a goal. The notion of levels (a hierarchy) of systems reflects that all systems are actually subsystems because all are contained within some larger system. The interconnections and interactions among the subsystems are called interfaces. 3.2 The Structure of a System Systems are divided into three distinct parts: inputs, processes, and outputs. They are surrounded by an environment and often include a feedback mechanism. In addition, a human decision maker is considered part of the system. A special type of closed system called a black box is one in which inputs and outputs are well defined, but the process itself is not specified. Many managers are not concerned with how a computer works. Essentially, they prefer to treat them as black boxes, like a telephone or an elevator. Managers simply use these devices independent of the operational details because they understand how the devices function and their tasks do not require them to understand the way they really work.

Journal of Information, Control and Management Systems, Vol. 8, (2010), No. 1 97 Figure 1 The System and Its Environment [5] 3.3 System Effectiveness and Efficiency Effectiveness Is the degree to which goals are achieved. It is therefore concerned with the outputs of a system (such as total sales or earnings per share). Efficiency Is a measure of the use of inputs (or resources) to achieve outputs (e.g., how much money is used to generate a certain level of sales). Effectiveness is doing the right thing. Efficiency is doing the thing right. 3.4 Processes A process is a series of actions or operations that transforms inputs to outputs. A process produces or generates output over time. The most obvious processes that are of interest to businesses are production or manufacturing processes. A manufacturing process uses a series of operation

98 The Systems Thinking as the Core of Principles of Learning Organization performed by people and machines to convert inputs, such as raw materials and parts, to finished products (the outputs). Examples include the process used to produce the paper on which these words are printed, automobile assembly lines and oil refineries. Figure 2 Graphical depiction of a manufacturing process [4] Figure 2 presents a general description of a process and its inputs and outputs. In the context of manufacturing, the process in the figure (i.e., the transformation process) could be a depiction of the overall production process or it could be a depiction of one of the many processes (sometimes called subprocesses) that exist within an overall production process. Thus, the output shown could be finished goods that will be shipped to an external customer or merely the output of one of the steps or subprocesses of the overall process. In the latter case, the output becomes input for the next subprocess. For example, Figure 2 could represent the overall automobile assembly process, with its output being fully assembled cars ready for shipment to dealers. Or, it could depict the windshield assembly subprocess, with its output of partially assembled cars with windshield ready for shipment to the next subprocess in the assembly line. Besides physical product and services, businesses and other organizations generate streams of numerical data over times that are used to evaluate the performance of the organization. Examples include weekly sales figures, quarterly earnings, and yearly profits. The U.S. economy (a complex organization) can be thought of as generating streams of data that include the Gross Domestic Product (DDP), stock prices, and the Consumer Price Index. Statisticians and other analyst conceptualize these data streams as being generated by processes. Typically, however, the series of operations or actions that cause particular data to be realized are either unknown or so complex (or both) that the processes are treated as black boxes.

Journal of Information, Control and Management Systems, Vol. 8, (2010), No. 1 99 3.5 Black Box A process whose operations or actions are unknown or unspecified id called a black box. Frequently, when a process is treated as a black box, its inputs are not specified either. In studying a process, we generally focus on one or more characteristics, or properties, of the output. For example, we may be interested in the weight or the length of the units produced or even the time it takes to produce each unit. As with characteristics of population units, we call these characteristics variables. In studying processes whose output is already in numerical form (i.e., a stream of numbers), the characteristics, or property, represented by the numbers (e.g., sales, GDP, or stock prices) is typically the variable of interest. If the output is not numeric, we use measurement processes to assign numerical values to variables. For example, if in the automobile assembly process the weight of the fully assembled automobile is the variable of interest, a measurement process involving a large scale will be used to assign a numerical value to each automobile. As with populations, we use sample data to analyze and make inferences (estimates, predictions, or other generalizations) about processes. But the concept of a sample is defined differently when dealing with processes. Recall that a population is a set of existing units and a sample is a subset of those units. In the case of processes, however, the concept of a set of existing units is not relevant or appropriate. Processes generate or create their output over time one init after another. For example, a particular automobile assembly line produces a completed vehicle every four minutes. Any set of output (object or numbers) produced by a process is called a sample. Thus, the next 10 cars turned out by the assembly line constitute a sample from the process, as do the next 100 cars or every fifth car produced today. 4 CONCLUSION Systems thinking is any process of estimating or inferring how local policies, actions, or changes influence the state of the neighboring universe. It also can be defined, as an approach to problem solving, as viewing "problems" as parts of an overall system, rather than reacting to present outcomes or events and potentially contributing to further development of the undesired issue or problem. Systems thinking is a framework that is based on the belief that the component parts of a system can best be understood in the context of relationships with each other and with other systems, rather than in isolation. The only way to fully understand why a problem or element occurs and persists is to understand the part in relation to the whole.

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