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Week9LectureSlides.pptxWeek 9: Matching Leadership to Situations I
The Blind Men & The Elephant
We have solved many problems by rationalising, analysing, reducing, looking for cause/effect & controlling (e.g. cured small pox)
The Enlightenment/Modernism worldview
However, we also deal with complex systems daily. Unfortunately, these systems resist reductionism, rationalism, control etc
Major problems remain unresolved (e.g. hunger, poverty, war, environmental degradation, Chronic illness etc).
We need to stop thinking the problem is “out there” rather than “in here”.
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Systems Thinking
There is relationship between the structure of a system and its behaviour
A system is a set of things interconnected in such a way that they produce their own pattern of behaviour over time
An outside event may unleash a systems behaviour but each system reacts to external events in its own way
It is more than the sum of its parts
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Think About These…
Political leaders don’t cause recessions or economic booms. Ups & downs are inherent in the structure of economy.
Competitors don’t cause companies to loose market share. The company creates the losses, at least in part, through its own business policies.
The oil-exporting nations are not responsible for oil price rises. The oil-importing nations are responsible because they have built economies vulnerable to supply interruptions.
The flu virus does not attack you; you set up the conditions for it to flourish within you.
Drug addiction is not the failing of an individual, and no one person can cure an addict. It must be understood as part of a larger set of influences and societal issues that one can begin to address.
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Think about this…
You think that because you understand ‘one’ that you must therefore understand “two’ because one and one makes two. But you forget that you must also understand “and” – Sufi Parable
How do you know whether you are looking at a system or just a bunch of stuff?
Can you identify parts? and
Do the parts affect each other? and
Do the parts together produce an effect that is different from effect of each part on its own? and
Does the effect, the behaviour over time, persist in a variety of circumstances?
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System Behaviour
Stocks are foundations of any system
These are elements of the system that you can see, feel, count or measure at any given time.
E.g. Water in a bathtub, a population, books in a bookstore, goodwill towards others (doesn’t have to be physical)
Stocks change over time through the actions of flow
These are filling & draining, births & deaths, deposits & withdrawals
A stock is the present memory of the history of changing flows within a system
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System Behaviour
STOCK
INFLOW
OUTFLOW
SOURCE
SINK
WATER
WATER in BATHTUB
DRAIN
INFLOW
OUTFLOW
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Systems Behaviour
When stocks grow/decline swiftly, or hold within a certain range, then a mechanism is at work via a feedback loop (e.g. interest-bearing bank account).
Flows in and out of the stock are adjusted because of changes in size of the stock itself.
Different types of feedback processes in a system
Balancing feedback (Stabilising loops)
Reinforcing feedback (Runaway loops)
The total amount of money in the account (stock) affects how much money comes into the account as interest.
Different types of feedback process in a system
Balancing feedback – this feedback stabilises the system (see next slide – coffee example)
Reinforcing Feedback – this feedback causes the system to grow or diminish (see next slide – interest bearing bank account)
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Stabilising Loop
STORED ENERGY IN BODY
ENERGY AVAILABLE FOR WORK
Metabolic Mobilisation Of Energy
Energy Expenditure
Discrepancy
Desired Energy Level
Coffee Intake
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SINK
This kind of stabilising, goal seeking feedback loop is called a balancing feedback loop (B). Balancing loops are goal seeking & stability seeking. Each tries to keep a stock at a given value. A balancing feedback loop opposes whatever direction of change is imposed on the system. If you push a stock up to far, the B will bring it back down and vice versa.
The presence of B does not mean the mechanism works well. It may not be strong enough to change the direction or goal of the system.
If you are a coffee drinker, when you feel your energy level run low, you may grab another cup to boost it again. Your have a stock of energy which you aim to maintain. The purpose of the coffee may be to keep your stock of energy at the desired level. It is the gap between your actual and desired levels of energy for work that drive your decisions to adjust your daily caffeine intake.
NOTE: The labels in the above figure are direction free. They say stored energy in your body, not low energy, coffee intake not more coffee. This is because feedback loops can operate in 2 directions. In this case if you drink too much coffee, the feedback loop can work in reverse. ALSO: I didn’t use a cloud for the flow because in every system there is more than one simple loop. Caffeine is only a short term stimulant that eventually leaves the body more energy deficient than before. That drop could lead to more coffee or it could encourage you to try a different healthier
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Reinforcing Loop
MONEY IN BANK ACCOUNT
Interest Added
Interest Rate
R
Can you think of a human decision that occurs without a feedback loop?
Is it A causing B or B causing A?
Reinforcing Loops – The more money you have in the bank, the more interest you earn. This exponential growth – this can be good news or bad news depending on what is growing e.g. money, HIV, the economy, the arms race.
Can you think of a human decision that occurs without a feedback loop? Falling in love? Suicide
Is it A causing B or B causing A? Bicycle example
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Characteristics of a System Thinkers
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Exploitation/Exploration Trade Off (March, 1991) (i.e. Organisational Learning)
Theory of Rational Search
Gaining new information versus using current information to improve organizational outcomes (i.e., Organisational Learning)
Bounded rationality
Organizations tend to prefer exploitation over exploration
Returns from exploration are less certain, more remote, and harder to adapt to
Organizational learning improves exploitation more rapidly than exploration
Positive feedback loops can produce path dependency
What Impacts Organisational Learning? (March, 1991)
How organisations and individuals learn from each other.
Organisational and individual codes converge over time to become more homogenous
Rapid learning is not desirable; Slower learning allows for greater exploration and improved exploitation
Rapid socialisation of individuals into the organization produces inadequate exploitation and reduces exploration
Knowledge & Ecologies of Competition
Internal & External competitive processes pit organisations against each other in pursuit of scarce environmental resources (i.e. limit exploration)
Organizational learning improves competitive advantage in the competition for primacy
An emphasis on exploitation can compromise primacy
Strategic Leadership for Organizational Learning (Jansen et al. 2009)
What type of leadership is required for exploitation/exploration (i.e. organizational learning)?
Exploration – positive leadership styles (e.g. transformational, ethical, servant, democratic etc)
Exploitation – traditional leadership styles (e.g., transactional, trait, situational etc)
Leadership behaviours have a significant impact on innovation outcomes.
Environmental dynamism moderates these effects
