Target For Success: Map The Relevant Systems Design the Future Target for Success Campaign to Win Finish with Finesse Map the Relevant Systems Identify the Centers of Gravity Determine the Desired Effects

The Promethic Laws Every Thing and Every Action Happens In A System Every Action Affects The Future Specific Actions Create A Specific Future Every Thing and Every Action Happens In A System All Systems Have Inertia and Resist Change All Systems Have Centers of Gravity Systems Change When Their Centers of Gravity Change The Extent and Probability of System Change Is Directly Proportional to the Number of Centers of Gravity Affected and The Speed At Which They Are Affected All Known Systems and Things Have A Beginning and An End Specific Actions Produce Specific Ends

Systems And Centers Of Gravity Why Targeting Is Critical Never Enough Resources Available To Do Everything Need To Have High Probability of Winning Despite Inadequate Resources Must Chose Where To Apply Resources Effort and Resources Must Be Applied Against Something Targets Failure to Choose The Right Targets Dooms Operations Before They Begin The Right Targets Are The Key to Creating The Change Needed To Realize The Future Picture Targets Are Part of A System

Systems And The Future Picture At Least Two Systems Stand Between An Organization And Its Future Picture The Organization’s Internal System The System(s) External To The Organization (Market, Enemy, Political Environment) To Make The Future Picture A Reality Change The Internal And External Systems Process: Identify And Map The Relevant Systems Decide What They Must Become

The Business Strategy Process Systems From The Future Picture Right External System Future Picture Right Internal System TIME

Representative Forces Operating On A Market System Consumers And Customers Old Producers Government Financiers Distributors New Companies Media Suppliers

System Characteristics Disparate Elements Have Centers of Gravity Have Inertia Have Energy Have Information Flow Common Design Patterns Have Hysteresis Effect Are Fractal Retail Stores Market Leaders Communications Facilities Sales Force Key Media Finance System Road & Rail Net interest groups Government Distribution System customers University Research And Development customer’s customer employees innovators Triggers: Title System Grid US Flag Comments:

Energy Change Positive Energy Change Negative Systems Have Energy Triggers: Title – Displays Military System Title – Collapses Military System System Model Energy Change Positive Energy Change Negative

Systems Resist Change

And Exhibit The Hysteresis Effect And Exhibit The Hysteresis Effect Systems Resist Change And Exhibit The Hysteresis Effect And Exhibit The Hysteresis Effect

Centers Of Gravity (COGs) The Leverage Points In The System Between You And Your Future Picture Have Disproportionate Impact High Return On Energy Investment Resources Limited? Attack Centers Of Gravity Triggers: 1.Title

Universal System Pattern Template E(s) = f(Leadership) x f(Processes) x f(Infrastructure) x f(Population) x f(Fielded Forces) Leadership Processes Infrastructure Population Action Units P(s) = f(physical) x f(morale) Triggers: Title Iraq and Labels Iraq Map System Map & Labels Comments:

System Components Person State CEO, Board, Market Leaders Leadership Company/ Market Person State President, Key Media, Policy Makers CEO, Board, Market Leaders Leadership Brain Circulatory, Neuro System Communications Energy Innovation, Finance, Communications Processes Plants, Value Networks, Installed Base Infrastructure Bones, Muscle Highways Triggers: Title Demographic Groups Employee Groups, Customers Population Cells Action Units Military, Police, Merchants, Agencies Sales, Buyers, Retail Outlets Leukocytes

Systems Are Fractal Triggers: Title

Chip Company Supplier #2 The Market System Fidelity Mutual Fund Office Depot Store Stock Analyst Morgan Stanley VC Computer User Software Programmers Microsoft Internet Service Provider Chip Company Supplier #2 Chip Company Supplier Office Depot Store Computer User Intel Compaq Chip Company #3 #2 Triggers: Title Your DSP Company

Map The Relevant System The Market Start Here! Customer’s Customer Investment Community Government Customer’s Customer’s Customer Developer Component Maker Supporting Facilities Direct Customer Competitor 2 Company Supplier #2 Company Supplier Associations Don’t Start Here Your Company Competitor 1 Triggers: Title Your DSP Company Or Here

Stating Desired System Effects Focus On Whole System In Relation To Future Picture Decide What The Systems Need To Become To Realize Future Picture Including The Requisite Energy Levels Be Very Careful To Stay Strategic—Don’t Prescribe Solution! Work Back From The Future

External (Market) Desired Effects Market Needed To Realize Future Picture Market Fiscal State Dollars Being Spent On Your Product; Investment Capital Market Excitement State (Awareness, Perceptions, And Attitudes) Recognition Of Company And Product; Degree Of Enthusiasm; How Market Is Reacting To You; Response To Citizenship Market Technology State New, Supporting, Or Ancillary Technologies Desired; Associated Products That Would Build Demand Market Scope Total Available Market (TAM) And Vector; New Customer Requirements (Current Non-consumers), Market Concentration Market Obstacles Desired Regulatory Climate; Standards Or Codes Desired Or Needed; Political Climate Momentum Market Growth Rates At Future Picture Horizon

Internal (Organization) System Desired Effects Synthesized From Future Picture Key Descriptors Fiscal Business Innovation People Culture Incentives

Negative Energy Change Triggers: Title – Displays Military System Title – Collapses Military System System Model Energy Change Negative

Desired System Effects Case Study Iraq 1990-91 Iraq System Characteristics Expanding and Aggressive Preparing and Equipping For Conquest Crucial Position In Mid-East Geopolitics Iraq: Desired System Effects Assets: Adequate For Functionality Attitude: Learned A Lesson; Won’t Try Again Technology: WMD Broken Scope: No Offensive Capability Obstacles: Few Internal, Overwhelming External Momentum: Collapses To Weak Energy State

Energy Change Positive Energy Change Negative Triggers: Title – Displays Military System Title – Collapses Military System System Model Energy Change Positive Energy Change Negative

Market Desired Effects Disneyland Illustration Timeframe: 9 Years (1951-1960) Market Fiscal State 5X Increase In Money Spent On Theme Park Attendance (1955-1960) Market Awareness, Perceptions, And Attitudes Market Excited By Opportunity For Family Trips To Theme Parks, Sees Theme Parks As Wholesome, Exciting, Safe, And Educational. High Recognition For Brand Market Technology State Ability To Create Ultra-Realistic Settings And Manage Crowds Market Scope Market Moves From Local To International; Includes Teenagers And Adults As Primary Visitors Market Obstacles Local Governments Build Access Roads; Zoning And Tax Rules Are Friendly; Regulators Work With Disney To Establish New Standards Momentum Market Growing Rapidly (Sufficient To Accommodate Disneyworld—And International?)

Internal (Organization) System Desired Effects Disneyland Example Fiscal Revenue Sufficient To Provide Free Cash Flow For Improvements, Long-term Debt Payoff, And Profits For WDC Business Disneyland Able To Operate Smoothly At Capacity; Capacity Growing; Complementary Items Developed And Offered For Sale; Disneyworld Planning Underway Innovation Robust Innovation Process In Place; New Attractions In Operation; More People Able To Visit Disneyland With Less Wait-time; Superb Customer Service People Creative Workforce Improving Attractions And Processes At An Impressive Rate; Guests Commenting On How All Their Needs Are Anticipated; Site Immaculate; And Supervisors Complaining That They Can’t Keep Up With Their Subordinates Associates Proud, Have Morale High, Are Receiving High Marks For Customer Service, And Are Buying WDC Stock. Few People Want To Leave Culture Everyone Involved, Great Ideas Flowing, Strategically Aligned, Executing Quickly And Effectively Incentives Incentive Plan Functioning, Understood, And Appreciated; Salaries High; The Right People Staying. Non-Monetary Rewards Well-Received

Market System States Energy Indicators Expanding Static Contracting Sales Growing, Margins High & Sustainable Sales Flat, Margins Shrinking Sales & Profits Falling Rapidly (Overall) General Making Money Easy Hard Varies Much Lower Prices, Significantly Better Service, Notable Product Improvements Product Availability, Ease of Adoption, Acceptable Price Points Product Availability, Extreme Price, Extreme Service Differentiators Additional Revenue Opportunities Take Customers From Competitors Be One of Few Remaining Sources Newly Aware Customers Vying For New Business, Little Pricing Pressure Squeezed & Loath To Take Risks Fewer & More Expensive Suppliers Stock Price to Earnings Ratio Well Above Broad Index Averages Below Broad Index Averages Far Below Averages & Falling Investors Clamoring To Get In Investment Capital Available At High Cost Scarce

The Essence of System Strategy Know What The Relevant Systems Must Become Identify The Centers of Gravity Decide Effects To Impose Analysis Leads To What, Not How “The Enemy Of Change Is The System”

Understand The Relevant Systems Insights and Discussion Prometheus Process Understand The Relevant Systems Insights and Discussion