Management As A System

What is a system?

A system is comprised of processes, some important, some not so important. A process has a start and a stop, an in and an out. You know you have a process when you can flow chart it on a piece of paper. A process has a certain state. It is mature and working well or could be embryonic and very immature. A process can be broken if some pieces are not working well together. The system then represents the state of all of its processes. The idea of a system is to focus on long term stability. Understanding the system helps not to make short term decisions which may temporarily fix the immediate need but damage the system in the long term. It is easy when trying to resolve problems to focus on cause and effect.

What is a management system?

A management system also has many processes on multiple levels. They all contribute to the health of the management system. For example, it is very important to understand what process is used to evaluate people. If people are evaluated in a way which encourages competition among peers this will influence the overall competition and affects the climate in a company in an unhealthy way. If people are encouraged to work together on teams and collaborate, the system will look different. In this case people will tend to help each other more without fear of sharing information which might affect their performance ranking. The way managers communicate affects the overall system. If management typically keeps its doors closed and rarely shares business updates with the entire staff, the system will tend to operate in a way which encourages secrets, gossips, and many other problems. If management keeps the doors open, it will help open communications and overall sharing of all business related information to all levels. In this type of system one will see more risk taking, creativity, and interest in the business by employees.

The Worst management system!

The worst management systems encourage limited information sharing, a lack of creativity, unfairness and less opportunity to contribute and participate in the overall business. I will give you a few examples of bad management systems.

A top manager asks Human Resources to establish a ranking and rating system among staff in an effort to improve performance but this leads to less teamwork and positive relations between staff and a direct impact to the bottom line.

Another manager might establish a new policy that limits overtime which leads to an increased amount of errors in the workplace as employees rush to complete their work so they are not forced to work long hours without pay.

A manager implements a new policy which restricts employees from transferring to new positions if they are not performing well in their current role. This leads to people leaving the organization for lack of opportunity when all they may have needed are new opportunities. Now the manager will have to hire replacements at usually twice the costs.

Another manager decides that the first cost cutting activity should be to eliminate free coffee and instant soup in the lunch rooms. This does not lead to much cost savings but instead sends a message to employees that they are not that important thus leading to work slowdown, poor morale, and people leaving, which ends up costing the organization many times over what the coffee and instant soup cost!

Another example is an employee is always late to work so the manager punishes the employee by not allowing this person to contribute to new efforts. The person as a result of the punishment starts to arrive at work on time. The manager likes the result so decides to implement new attendance policies for all employees. Long term however employees feel micro-managed and start to contribute new ideas less often causing an overall drop in system performance.

These are examples of behavior which is usually well intended but simply not thought through from a system’s view.

The impact of non-systemic thinking in management

Decreasing revenue, morale, working relationships, and overall fear and lack of trust occur with short term non-systemic thinking. A recent county government manager decided to shut down many local parks just to resolve a short term budget gap. As a result the people who used to pay on weekends to attend these parks now traveled to new areas in different counties where they spent their weekend dollars. Much more overtime is lost through this new cost cutting. This could have been avoided with systematic thinking upfront. The way management roles models itself will influence the system and the behavior in it. Just wander into any retail store and you will notice the health of the system. For example there is one office chain I used to visit. It became more difficult to find any employees working there. It seems in this store they are each given assignments in the morning having ...