1. Systems and the Fifth Discipline

2. Organizational Learning Disabilities

3. Organizational Learning Disabilities
Most companies are poor learners.
Trouble is often very apparent, yet ignored.
Let’s identify the seven leaning disabilities.

4. 1. I Am My Position We are trained to be loyal to our jobs
We “become” the job
What do you do for a living?
Most describe their daily task.
Not the PURPOSE of the greater enterprise
NASA janitor
Most feel they have little or no influence in the system
Responsibilities are limited to the boundaries of their position.
Detroit vs. Japan

5. 2. The Enemy Is Out There
Thou shalt always find an external agent to blame!
Think “Little League”
We often have a propensity to blame others
When we only focus on our position, we don’t see how our actions extend beyond the boundary of that position.
“Out There” and “In Here” are usually part of a single system.
US Postal Service

6. 3. The Illusion Of Taking Charge
Like to be “proactive”?
…as opposed to being “reactive”?
All too often proactiveness is reactiveness in disguise
If we’re simply becoming more aggressive fighting “the enemy out there”, we’re reacting
True proactiveness
Seeing how we contribute to our own problems
It’s a product of our way of thinking, not our emotional state

7. 4. The Fixation On Events
She took my… He broke my…! She won’t let me… Yeah but he started it!
We are conditioned to see life as a series of events, and for every event, we think there is one obvious cause.
Organizations are concerned with “events”
Last months sales, new budget, quarterly earnings, who was just promoted, fired…

8. 4. The Fixation On Events cont.
Focusing on events leads to “event explanations”.
We don’t see the big picture.
Design a caveman…
Right; immediate actions to stop immediate threats!
Today however, the greatest threats are from slow, gradual processes!
Create! Use generative learning.
Everything else is simply reactionary.

9. 5. The Parable Of The Boiled Frog
Put a frog in a pot of boiling water and…?
Put the frog in room temperature water, and?
Now, start to turn up the heat, and?
Right… zip. Why?
The frog’s internal apparatus for survival is geared to sudden environmental changes. Not slow gradual changes
American auto industry in the 60’s
You have to slow you pace to see the subtleties going on

10. 6. The Delusion Of Learning From Experience
The most powerful learning comes from direct experience.
What happens if the primary consequences of our actions are beyond our vision?
The “Learning Horizon”
Impossible to learn from events beyond this point
We learn best from experience but never directly experience the consequences of many of our most important decisions.

11. 6. The Delusion Of Learning From Experience cont.
R&D vs. Marketing
Investing in capital improvements
Promoting people
Very little opportunity for trial and error
Cycles are very difficult to see if they last beyond a year.
How long are commercials on TV?
So companies develop into departments
They then “stovepipe”
The most important issues that are cross functional, are rarely addressed

12. 7. The Myth Of The Management Team
Aren’t management teams and managers great?!
Do you really believe in management and their abilities?
Always fighting for turf? Arguing?
Trying to “look good”?
Pretending everyone is “on the same page”.
If here’s disagreement?;
Usually they’ll lay blame
Polarize opinion
Fail to reveal the underlying differences

13. 7. The Myth Of The Management Team
Most managers find collective inquiry a threat
We’re trained to never admit “we don’t know”
And companies reward those who don’t really pry!
When was the last time someone was rewarded for asking tough questions about policies?
Skilled incompetence! (Chris Argyris)
We become incredibly proficient at not learning.

14. Time for a beer…
The “Beer Game”

15. Okay, what happened? Prisoners? Of the System???
Or of our own thinking…..
The Beer Game
Thoughts?

16. Lessons Of The Beer Game
1. Structure influences behavior
Different people in the same structure tend to produce like results
Problems and poor performance are blamed on something or someone else
However, the SYSTEM generally causes the crises, not external forces or people mistakes

17. Lessons Of The Beer Game
2. Structure in Human Systems is subtle
We usually think structure = external constraints on people
BUT; structure in complex living systems means the basic interrelationships that control behavior.
How people make decisions is part of the structure
The “operating policies” that we use to translate perceptions, goals, rules and norms into actions.

18. Lessons Of The Beer Game
3. Leverage often comes from new ways of thinking.
When we focus on our own decisions we generally ignore how the decisions affect others.
When we look at just ourselves, we only need a short lever for change.
If you understand the “system”, and use a long enough lever, you can effect change

19. Lessons Of The Beer Game
We inherently love heroes.
If something goes wrong though, someone must have screwed up.
So who screwed up in the beer game?
What does the history of “The Beer Game” tell us?
If thousands of players, from around the world, have the same basic results, the causes of the behavior must be beyond the individual.
The cause of the behavior is in the system

20. Lessons Of The Beer Game
Beer game-like structures create similar crisis's in real life.
1985; PC memory chips: glut = low prices
1986; sudden shortage = 300% increase in prices
; semiconductors
1989; US auto industry
Real estate

21. Structure Influences Behavior
When placed in the same system, people, however different, tend to produce similar results.
Psychologist Phil Zimbardo experiment
Mock prison
Prisoners/guards
Mild resistance
Increasing rebelliousness
Abusiveness
This is a controlling structure, and look at what happened…

22. Structure Influences Behavior
Do you feel yourself controlled by forces in the system from time to time? Or did you feel in control?
Do you find yourself "blaming" the groups next to you for your problems?
Do you feel desperation at any time?

23. Structure Influences Behavior
So what does it mean to say that structures generate particular patterns of behavior?
In the beer game each player makes one move per week. That’s all!
The focus though is on THAT move
The results are inevitable classic buildup and decline of orders at each position
…and the further away from the customer the worse the errors
…AND, all this occurs based on a stable consumer demand

24. Structure Influences Behavior
In order for you to succeed, in the beer game as well as just about any place else, others have to do well also.
So how do you “play the game”?
First, take two aspirin and, wait..
Understand the delays
Second, don’t panic
Be disciplined

25. The Learning Disabilities And Our Way Of Thinking
All of the learning disabilities operate in the beer game:
Because players “become their position” they don’t see how their actions affect others.
Consequently, when problems arise, they blame others; “the enemy”.
When they get “proactive” and place more orders they make matters worse.

26. The Learning Disabilities And Our Way Of Thinking cont.
Because their over ordering builds up gradually they don’t realize he direness of their situation until it’s too late.
By and large they don’t learn from their experiences.
The consequences of their actions occur elsewhere
The people in the different positions become consumed with blaming the other players for their problems. Hence, no one is learning….

27. This is the premise: Events Patterns of Behavior
(Reactive) (Who did what to whom)
Patterns of Behavior
(Responsive) (Long term trends and implications)
Systemic Structure (Generative)
(What causes the patterns of behavior)

28. So… What the heck does this all mean?
And I’m not saying jack! You want to get out of here, show me you understand this.