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Strategic Systems Thinking Week 1 2016.pptx
- 1. Strategic Systems Thinking Anintroduction
- 2. Aims of theSessions this week • Introduce the nature of the module • Identify key ideas that underpin the module • Explore approaches to strategy • Examine how we can understand certainty in the business environment
- 3. Structure of theModule Two sections to be explored • Part A: Strategic Systems – Introducing Strategy and Systems – Systems Thinking; Hard and Soft Approaches – Complex Adaptive Systems – Strategic Thinking in Practice • Part B: Strategic Knowledge – Knowledge Management/Environment – Communities of Practice/Interest – The Challenge of Performance Measurement – Intellectual Capital and Social Networks
- 4. Assessment • Two piecesof work, each worth 50% of the overall grade • Details of the assignment tasks are provided in the VLE. • Assessment One – Deadline – Week 4 • Assessment Two – Deadline – Week 8
- 5. Key Ideas tothink about • Strategic Thinking rather than Strategic Decision Making • Business as a ‘social activity’ – ‘It is about people!’ • Different perceptions are interesting to think about. • Relationships rather than individual functions. • Understanding situations rather than simple answers to simple problems.
- 6. Certainty !! Innovation & Creativity Responsibility (CSR) Experience PeopleThinking Diversity Complexity Instinct ?
- 7. The Nature ofthe Environment Static Dynamic Complex Simple Certain Uncertain Maturity Researchability Important Factors A series of continuums can help to determine the nature of your environment
- 8. Activity • Food forthought: • What does the word strategy mean to you? • How have you used strategies in your life?
- 9. What do wemean by Strategy? • Strategy is a widely used term in business, politics, etc. • However, it is often used as a general idea of doing something • Origins in leading armies, expeditions, etc. • A common basis of strategy is to provide a clear purpose of the organisation • Yet, the notion of strategic management is a relatively modern part of organisational life and is not an agreed concept (Stacey & Mowles, 2015)
- 10. A Definition OfStrategy Strategy is the direction and scope of an organisation over the long term which achieves advantage for the organisation through its configuration of resources within a changing environment to meet the needs of markets and to fulfill stakeholder expectations. (Johnson, Scholes & Whittington, 2011)
- 11. Core Strategic Elements StrategicAnalysis Strategy Implementation Strategic Development
- 12. What do wemean by Systems? “A system is an entity which maintains its existence through the mutual interaction of its parts.” (von Bertalanffy, 1954) • Systems can be naturally occurring or man made • A system has a purpose that defines its actions • Things on their own have a limited use or value
- 13. What do wemean by Thinking? • The process of considering or reasoning about something • Thinking about the world is through established views or paradigms (Khun, 1970) • Paradigms are developed as we learn new things e.g. the earth was thought to be flat • Strategy is no different: “We use paradigms to think about and do strategies: what the important issues are, what we should value, what customers need, how to serve them and so on.” (Nonaka & Zhu, 2012)
- 14.
- 15. Strategy schools: twobasic categories Prescriptive – how strategy formation process should happen – ex ante or in advance; Rational, structured approach (Design, Planning, Positioning) Descriptive – seeks to understand strategy as it unfolds
- 16. Traditional Design schoolof Strategy • Agree strategy formulation – then move to implementation (completely separate) • Little room for incremental, emergent strategy changes during implementation • SWOT model – central in most textbooks Formulation Thinking, Design Implementation Acting, doing
- 17. Ways of ThinkingAbout Strategy Planned Emergent Process Design Ansoff Mintzberg/Stacey The Two Ends of The Spectrum Prescriptive (What To Do) Descriptive (How To Do It)
- 18. Development of StrategicTheory • The idea of managing corporations has evolved over the recent decades. • In this time the environment has changed, thus different questions are asked. • The idea of ‘paradigm shift’ • There are still important roots that strategy feeds from: – Economics, Finance, Social Theory
- 19. Pick a School Design& Planning Positioning Entrepreneurial Learning & Emergent Power & Culture (Mintzberg & Lampel, 1999)
- 20. Activity – Food forthought: – Identify the main aspects of each of the Strategic Schools we have just introduced. – What are the key reasons for the development of different schools?
- 21. Is it possibleto plan? Planning is a natural activity for people and there are a number of benefits that can be achieved: • External and Future Awareness • Competitor Awareness • Increased Productivity • Reduced Resistance to Change • Problem Prevention Culture • Prioritisation of Problems/ Threats • Improves Resource Allocation • Improves Tactical Actions • Improves Internal Communication (David, 1995 and Greenley, 1986)
- 22. Balance in Planning… Being able to plan allows us to: • Be Proactive • Clarify Objectives for Employees • Increase Performance? (no clear evidence) • Enable the realisation of Efficiency & Effectiveness However, can we fully; – Understand – Design – Plan its operation in detail – Predict its behaviour And … – Control?
- 23. Fallacies of Planning 1.The Fallacy of Predetermination or Predictability 2. The Fallacy of Detachment 3. The Fallacy of Formalisation (Source: Mintzberg, H., The Fall and Rise of Strategic Planning, Harvard Business Review Jan/Feb 1994)
- 24. Activity • Food forthought: – A certain planner or comfortable with adapting. – What are the reasons for your choice?
- 25. Calm Certainty orEdge of Chaos? • Life and economics and strategic management is a fishbowl! • i.e. A closed system – predictable – Greek-letter economics Or • Exogenous shocks, e.g., the Web (Beinhocker, E. 2000) ? ?
- 26. • Early Thinkingon Management in NE: – Punctuated equilibrium – Robust strategies rather than focused ones – Continuous adaptation rather than competitive advantage – Radical innovator as opposed to the conservative operator – Diverse strategies, not routinised – Flexibility, not scale Beinhocker, E. (2000) Strategy at the Edge of Chaos. Time
- 27. Activity • Food forthought: – Major changes that have changed or challenged assumptions (countries, industries) e.g. economic, technological or political shocks
- 28. The Nature ofthe Environment Static Dynamic Complex Simple Certain Uncertain Maturity Researchability Important Factors A series of continuums can help to determine the nature of your environment
- 29. Dynamic ENVIRONMENTAL CONDITIONS Simple Complex Making senseof the environment Static
- 30. Activity • Food forthought: – What are the Certainties that can be identified? – What factors add to the level of Uncertainty?
- 31. How Does StrategyHappen? - Four Levels of Uncertainty Level 1: Clear enough future Level 2: Alternate futures Level 3: Range of futures Level 4: True ambiguity Source: Courtney, Kirkland & Viguerie (2000) Strategy under Uncertainty
- 32. Making the Mostof Uncertainty - Adapt or Shape? • Adapt: existing strategies to market changes • Shape: the market to fit your strategy • Drivers: Globalisation; digitisation; unfettered capital markets • Risk vs. return equation more polarised • No dominant solution