“I am responsible for leading change in a large public sector organisation from a Command-and-Control to a Systems Thinking Organisation.  How important to the success of the change is the design of the change programme itself, designing it against demand from the services rather than a more traditional programmed change using methods like PRINCE2 to assess where you need to go and then keep track and plan the interventions.”

The simple answer is that leading this transformation is all about leadership, not the way you design the change programme. A well designed programme will help you make the change from a command-and-control to a systems design quicker and with fewer problems, but without leadership, you are destined to fail.

I’ll come to intervention design later, after I have explored leadership in more depth, and I’ll conclude with some words on tools, of which PRINCE2 is but one.

Leadership is a deal-breaker

Why is it that leadership is so important? The bottom line is that systems thinking ideas are counter-intuitive, and represent a direct challenge to the prevailing method of management.  Individuals and organisations have spent a lot of time, effort and money learning how to be good at command-and-control management. The government tell us it is the right thing to do, drives us to equate improvement with cost savings and the achievement of central targets, and sends inspectors out make sure we are following their prescriptions. Many people instinctively know that there must be a better way, and it is hard to imagine what that might be. Systems thinkers know that making that a systems alternative a reality requires direct, dedicated, leadership, what Deming called ‘Constancy of Purpose’.

When we learn to understand and manage our organisations as systems, it turns out that our present (command-and-control) ideas are the very thing that is driving waste and poor performance into our organisations.  Our assumptions about structure and hierarchy, work design, roles, measures, ‘performance management’, budgets and finance, regulation, appraisals, business planning, and change management all need to change. I could go on with the list, but you see my point… Systems thinking is counter-intuitive and counter-cultural, and to ‘get it’ we need help to un-learn our command-and-control assumptions before we can re-learn. This can be strong medicine and requires direct, committed, supportive leadership – your change from a ‘command and control’ to a systems thinking organisation must be led from the top because it is a ‘leadership thing’ and ‘thinking thing’.

Here is a counter-intuitive idea to serve as an example:

Organising services into shared front and back office factories (surgical instrument sterilisation in hospitals, ‘customer service centres’) is a plausible idea to create economies of scale, but in fact deeply flawed – instead we need to understand the ‘economies of flow’ that result from designing services against demand and at all times make structure subordinate to flow.

Read the statement above again and then ask yourself these questions:

Do staff and middle managers have the authority and skills required to reconfigure the system by designing against demand?

Your answers to these questions will of course have been 1.The senior leaders, 2.No and 3.The hierarchy would attempt to stop them.

Whether we like it or not, there is a systemic relationship between thinking and performance in our organisations – in Vanguard we articulate this with a simple logic…

Vanguard only does one thing – we help organisations make the change from a command-and-control to a systems design.  The objective of any intervention is to move the organisation forward on this path; improving performance (service, cost, revenue and morale) by changing thinking. ‘Constancy of Purpose’ is about helping everybody in the organisation to put new (systems) principles for the design and management of work into practice, with a constant focus on the customer, and striving constantly do optimise the system for their benefit.

A tactical issue arises from the correspondent’s question – “I am responsible for leading change…” I wonder if you are an Operational Leader (in charge of work) or the leader of a support function (HR, IT, OD…) who has been given responsibility for a change agenda. If we are seeking to create a sustainable shift to a systems design, then the operational leaders must lead the transformation themselves – if they do not, there will be no sustainability. If you are a leader in a support function, then your role is to teach and support the operational leaders – you must not accept or assume responsibility for the transformation yourself. Let’s move on to how we might do that, and consider intervention design issues.

Intervention Design

Where to start? We could conduct an analysis of the ease of change, potential risks, cost to change, financial benefits, impact on customers, impact on CPA score… This could be presented in four-by-four matrices to determine priorities, and programme management structures established to push the change through and monitor progress and benefit realisation.  Let me propose the alternative that your question hints at – start where it is easiest, where you are most likely to get a result (change the thinking, change the system, improve performance) and create the desire amongst leaders to do more to move the organisation down the systems route. When leaders are ready to lead the change, make sure they take personal responsibility for the new system, and it is not delegated (abdicated) to project managers and project teams. Operational leaders are responsible for the performance of their systems; why should they allow anyone else to lead change for them?

My suggestion is that initially you go to the places where there is a desire amongst senior people to learn and lead. Core processes (where work is done for customers) are generally better places to start than support processes (where work is done to support the core work). Once you have learnt to design and manage a different way, it will become clear how to develop a more structured programme of interventions – your knowledge of the system will guide you.

When you do things to create curiosity about systems ideas, leaders will pull. Work with them to build their understanding of the way current assumptions are driving sub-optimisation of performance, the scope for improvement when seen from a systems point of view, and the challenge for them as leaders if they want to make the change to a systems design. Leaders must understand this in clear, operational terms, and they can only do this if they go to places where customers transact with the organisation and study how the work works, and why it works the way it does - we call this process of building knowledge ‘Check’.

Armed with knowledge, leaders can make an informed choice to begin to lead the change process – everyone else will then need to be supported through Check-Plan-Do cycles to establish the new system, and the leader will take responsibility for making this happen.

At the initial Check stage, it is impossible to predict what is going to happen when the system is redesigned - redesign hasn’t happened yet – this makes it difficult to construct a traditional ‘business case’. Leaders will have knowledge of the ‘what and why’ of current performance, so they will know how much scope for improvement there is… The question becomes “how close to perfection can we get, how fast can we improve, and what will it take?”. Change is thus an emergent process, an important systems idea. This will be counter-intuitive (there is no ‘as-is’ and ‘to-be’ in my world) and most likely highly counter-cultural in an organisation used to business cases, programme boards and ‘best practice’ programme management; which leads us on to...

A note on tools

My father used to serve in the Royal Navy and describes his interactions with service organisations (“we don’t do that, I need to transfer you to customer accounts…”) as ‘dockyard tennis’. Senior managers see symptoms of poor service design like this as problems in themselves, and are attracted to tools that appear to address them (Kaizen Blitz, 5S, six sigma, takt time, visual measures…) Command-and-control managers say “show me the tools, and get people to use them” – this requires no leadership and certainly does not lead to any counter-intuitive understanding about the nature of work.

Systems thinking leaders by contrast will cry “show me the problem, and I’ll help you to understand and solve it.” Tools are incidental to this process – we might acquire or develop some to use along the way.  I used to think that if only I could teach managers how to use control charts, then the world would be a better place. I have learnt the hard way that the real challenge is to help people understand variation as part of a wider understanding of the systems they work in. I never ‘teach’ control charts as tools, we just happen to use them when we are helping people to think differently about variation.

The focus for systems thinking leaders is to help other understand the systemic causes of problems and to apply sound (systems) principles for the design and management of the work.

So where does this leave PRINCE2, and other project management methods? Does it lead us to challenge the way we think? Is there anything about PRINCE2 that leads us to make counter-intuitive breakthroughs in our understanding of the world? Does PRINCE2 support and re-enforce a set of command-and-control ideas about management and change? This is not to say that some form of forward planning, structure, rigour and discipline is not necessary or desirable in the processes of change; however when presented with a tool a systems thinker will react in different ways to a command-and-control thinker.  I’ll leave you to work out what those differences are…

To conclude I want to paraphrase an extract from a pamphlet written by the Operations Management Consulting Division of the Toyota Motor Corporation:

“Introducing Systems Thinking to service organisations can be a trying experience.  This way of thinking exposes waste mercilessly.  People must be prepared to abandon familiar and longstanding practices.  Top management must take part directly in clearing away obstacles and in implementing and maintaining the new system.  Front-line managers, meanwhile, must provide worksite leadership in putting the concepts of Systems Thinking into practice.”

There is no substitute for leadership – once you have leaders who can see the sub-optimisation caused by their current management assumptions, are curious about a better way, and are prepared to directly lead the transformation to a systems design, your approach to planning and keeping track of interventions will be infinitely easier – with a little expert help the leaders will be able work out how to do it for themselves.