Systems Thinking and the Three Musketeers - Deming's SoPK Part I

Conceptually, it is often easy to grasp the concept of Systems Thinking, writes contributor Eric Christiansen, in the first of a four-part series looking at Dr. W. Edward Deming's system of management - the System of Profound Knowledge (SoPK). What is more difficult is figuring out what you should do once you understand it. And that's where the Three Musketeers come in.

Read Part II: The Trouble with Motivation

Read Part III: Variation, So Meaningful Yet So Misunderstood

Read Part IV: How Do We Know What We Know?

"All for one, one for all." For over 150 years these words have invoked images of four young men working together with single minded purpose to overcome great obstacles, privations, injuries and loss. (In the Alexandre Dumas novel, TheThree Musketeers, Athos, Porthos and Aramis are the three musketeers who eventually befriend D'Artagnan –thus making four companions "All for one and one for all.") At the heart of "Systems Thinking" is the same philosophy and call for action for the benefit of all.

Conceptually, it is often easy to grasp the concept of Systems Thinking and the various components that go into a system (people, processes, materials, environment to name but a few). What is much more difficult is to actually execute from a Systems Thinking perspective. While in his seminars and publications Dr. W. Edwards Deming took great pains to describe the typical management practices that inhibit Systems Thinking, he also provided guidance and examples on how to create, nurture and execute systems thinking in an organization.

The first obstacle for many organizations is the lack of a clear aim. Without an aim, a system does not exist. Without an aim what would be its purpose in existing? How would it fit within the market or within the greater sphere? What would it hope to achieve in the long term? Without answers to these questions, there is nothing to be accomplished. Dr. Deming counseled that a system must have an aim and that aim should be a value judgment and must include the future in its scope. Think of the effect these visions have had on the respective organization:

• Quality is Job #1- Ford Motor Company, the only American car company not to seek government assistance in 2008.
• Bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through innovative hardware, software and Internet offerings. - Apple, has redefined the personal music player, cell phone and tablet PC.
• I shall return - General Douglas MacArthur, led to eventual liberation of Philippines after 2 years of various success and failures on the battlefield.
• Be one of the world's leading producers and providers of entertainment and information - Walt Disney Company, customers will save for a couple of years to have the Disney Experience, and it is a leader in various entertainment segments including sports, news, electronic entertainment, and travel.

Each brings a clarity of purpose which, as Peter Senge details in The 5thDiscipline, is required to build a shared vision that enables an individual to commit and enroll themselves to the success of the all rather than just compliance with the organizational rules and expectations and a focus on the success of the self. Such committed and enrolled people greatly help the organization be poised for success.

The 3 Musketeers' Mission: All For One & One For All

Having a mission statement with committed individuals does not mean that an organization is working as an effective system. As mentioned earlier, Dr. Deming detailed forces that destroy a system. The most common destructive forces include extrinsic motivation (prizes, grades, pay for performance, sales commissions, incentive pay, stock options), management by numbers/objectives (quotas, zero defects, focus on hitting quarterly financial numbers, revenue targets), and competition (individual cost/profit centers, performance reviews, group competitions, individual group/rankings).

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Adding to these forces is the use of the "pyramid" or traditional organization charts. They do not describe a person’s job, where the person fits into the system or how the person’s job impacts the company; rather, the traditional organization chart shows only the reporting structure: the people an employee needs to satisfy in order to get a good rating. The traditional organization chart fragments an individual’s view of the system and leads to view of independent – rather than interdependent – operation.

A better view is a flow diagram such as one that Dr. Deming illustrates in The New Economics (p58).

This view helps individuals see where they fit within an organization: Whom do they depend on to succeed? Who depends on them? Where does their responsibility fit within the overall system of the organization? With distributed, global organizations and globally spanning supply chains, such information is invaluable not only for the C-level executive at headquarters, but for the individual contributor in Bangladesh and her counterparts in Europe, South America and the US Midwest. By knowing this, true systems thinking can begin to occur as individuals/teams/departments begin working to improve the interactions that the flow diagram will help them understand exist within the system. It is these improvement activities that will begin to unlock the potential within an organization.

Most organizations spend lots of time and effort to identify "winners" that will come in and help drive success, for as Dr. Deming states "who wants to do business with a loser?" But organizations are mystified that even though they are bringing in the best and the brightest, their organization seems to be operating below peak efficiency. At a minimum, an organization expects that the results of having Person A, Person B, Person C, and Person D would be the Sum of all (A+B+C+D); what they get many times is something less.

As Dr. Deming describes in The New Economics what organizations experience are the sums of the various interactions between the individuals: (AB)+(AC)+(AD)+(BC)+(BD), (ABC)+(ACD)+(BCD), (ABCD). Some of these interactions are positive; others are negative. The goal of management is to support and create positive interactions and work to minimize negative interactions. It’s only through these efforts that an organization’s true potential can be unleashed, and true system optimization can be realized. If each person/team/department is required to optimize itself for individual profit, performance or gain, the system will not be optimized as these efforts lead to negative interactions with other components of the system.

At the end of The Three Musketeers, the heroes victoriously prepare for their next adventures after successfully accomplishing their aim in protecting the sanctity and honor of Queen Ann of Austria against the depravations of Cardinal Richelieu, the deprecations of Louis XIII, and assaults by Milady. So too will organizations move successfully into the future, through the use of Systems Thinking, by providing a clear aim that is not merely limited to profitability but to optimizing the entire organization, removing the forces that destroy a system, and promoting the positive interactions that create the "All for one, one for all" camaraderie found in the most successful organizations.

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Deming's SoPK Series on PEX Network

System of Profound Knowledge (SoPK) is the main subject of Deming’s second book on management, The New Economics. SoPK is Deming's system of management and has four interdependent areas:

• Appreciation for a System –how to lead a system, and systems thinking
• Knowledge about Variation, including statistical variation
• Theory of Knowledge -the study of how we know what we know
• Psychology - understanding the human aspect of management, and especially intrinsic motivation vs. extrinsic motivation.

Dr. Deming pointed out that one need not be an expert in any of the four elements, but viewing the world through the lens of the four elements with some proficiency would provide the viewer with profound knowledge of how to lead, diagnose data and issues, plan for the future, have everyone work together to optimize the system, innovate, and create an exciting win/win environment for customers, suppliers, employees, and managers alike.

Read Part II: The Trouble with Motivation

Read Part III: Variation, So Meaningful Yet So Misunderstood

Read Part IV: How Do We Know What We Know?

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Editor’s Note: The columns published in THE DEMING FILES have been written under the Editorial Guidelines set by The W. Edwards Deming Institute. The Institute views these columns as opportunities to enhance, extend, and illustrate Dr. Deming’s theories. The authors have knowledge of Dr. Deming’s body of work, and the content of each column is the expression of each author’s interpretation of the subject matter.