The core theme is that traditional strategy development and execution often fail because organizations are designed for control rather than adaptation. The Viable System Model (VSM) offers a framework for building strategy as a dynamic, living capability that can learn, maneuver, and maintain its course amidst uncertainty.
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it I think.
>> Yes. Yeah. Yeah. Happy.
>> Is that okay? So we can can make it
available for others after that here.
>> Yeah. Yeah.
>> Excellent. So let me share my screen and
uh do the intro. I will uh do an intro.
Then we have uh Mike in the focus. He
will talk about the viable system model
and an emergent approach to strategy.
How to build strategy as a living
capability. one that maneuvers, learns
and holds its course when reality fear
refuses to cooperate. Very interesting I
think very actual uh especially in in
the European industries today I believe
and uh Mike is a very knowledgeable
about the viable system model. I think
he use it also in practice and we going
to talk about that maybe 45 minutes
focus on Mike and then I suggest we have
a discussion afterwards.
if that is okay. So, uh let's maybe Mike
present his ideas. I will challenge him
a little bit. If you agree, ask him some
questions. Then we go and going to have
a common uh discussion afterwards. If
you would like to say something in
between then you can also write in the
chat and maybe uh if Kishan if you could
let me know if somebody raises their
before we start getting into that I
would like to say one word about
metaphorum and what we're doing
the purpose of metaphorum is three
things mainly to undertake and promote
Secondly, to ensure the VSSM viable
system on teams integrity,
quality and education and practice and
develop global community of knowledge
and practice. These are the three things
that we're doing since about almost 20
23 years now
>> 23 years they have been the founders. uh
happy that you're here tonight and very
welcome to both of you as well.
And uh we're doing these things by uh
the following buckets here. We do some
research projects, research groups. We
do general webinars also on onto
ontological ontological questions. You
see, I speak a perfect accent without
the slightest English. So maybe
sometimes it's a bit difficult. Uh we do
the VSSM practitioner webinars. That's
where we are tonight. This is a
practitioner webinars which means it's
geared to an exchange on experience in
the field of applying the Bible system.
It's not about its uh theory. It's not
about its developments. It's about well
developments in practice if you like. We
do conferences, publications and we have
a website. That's the website. And if
you want to uh get the newsletter, um I
think you can become a member if you're
not a member yet. So that's what we do
to keep it brief.
Um the vem practitioner webinars we did
these so far this year. We had in March utiman
utiman
uh in a large German automotive supply
company about the application of the
system model to a plant in Mexico.
We had Mark Lombberts in May on a method
about the VSSM the collaboration canvas
June again an application case IPS Swiss
company in September
Krishan on VSSM training aspects and in
October again a methodological
support tool for MSM uh accountability
metrics. Chris Lombbertson tonight the
last one this year Mike Jones very
welcome once more Mike thank you for
being with us tonight on the VSSM and an
emerging approach to strategy
now session abstract
we will talk Mike says
most strategies do not fail because the
plan was wrong but the organization was
built for control not for adaptation
fix expirations or documents to be
implanted. That's how people look at
strategies. That's what you're saying.
And we will explore tonight how
structure behaves uh shapes behavior,
how observation must become before
aspiration and why must be lived and not
just declared using the viable system
model as a lens. How can it help us to
defi design that for ad adaptability and coherence
coherence
and um how can we build these kinds of
strategies that are required from the
lens of the viable system model that's
the focus tonight let me introduce us
our guest tonight and then we can start
directly hand it over to you Mike you
are I found that interesting you're an
organizational psychologist
And um you will
close help leaders close the lap between
strategy and execution. Is that a
psychological question, Mike? >> Sometimes.
>> Sometimes.
>> Sometimes it is. Sometimes it is I
think. But that's not the main topic
tonight, I guess. Right. >> No,
>> No,
in part we can cover some of that.
>> Okay. Okay. You've been a former British
Army soldier where you seen the
realities of leadership in uncertainty.
I had uh took the liberty to highlight
some things in your CV here that I found
interesting. Realities of leadership in
uncertainty. Plans rarely survived
contact with reality. What that that was
your experience, right?
>> Yeah. Um as we talk about we live in the
world of von malta where nothing suffice
contact with the enemy. Um so you know
from young age we are constantly
maintain adaptability. Right. Right.
That's the famous quotation by fon mula
the older I think
reformulated by clausovitz. Right.
and Mike and and even later by Mike
Tyson saying that everybody has a plan
until they get hit in their mouths for
the first time. You need still to be
able to react, right? Be adaptable.
Okay, that's the topic tonight. Very
interesting, very, very important for
today's practice, I think. and you're
going to say something about your
experiences, but I think our companies
really lack of that to a great deal,
especially in Europe nowadays. Uh you're
working with large public and private organizations
organizations
help to keep them adaptive realize uh
decentralized viable. You work also with
the viable system model, right? You have
been uh
>> what was your encounter with the vital
system model? What what are you doing
with it? Uh I mainly use it to help
diagnose and design um organizations. So
I even though I'm a strategy advisor you
you can't really do that without
understanding the organization. So help
then um I use viable system model as the
main um tool to understand and also
develop organizations.
>> I see. I see.
And um you have a podcast strategy meets
reality a podcast and an upcoming book
when strategy meets reality an emergent
approach to strategy and execution right.
right. >> Yes.
>> Yes.
>> I Yes. Sorry.
>> Hopefully it'll be out in July next year.
year.
>> Very good. We're going to read it
definitely. Um
yes. Anything else that we should know
about you?
Um, no, I think that sums it up. Yeah,
soldier system thinker. Yeah, that's
pretty much where a lot of it comes
from. Excellent. Excellent. So, yes. Uh,
where do we want to start? Do you do you
want to share some ideas? Share a
screen. Uh, shall we just start into
this discussion? How you want to proceed?
proceed?
>> Yeah, I'll um I'll share some slides.
I'll have a I'll I'll sort of give my
sort of thoughts for the first sort of
20 minutes and then it'd be great to
then turn that into a discussion.
>> Excellent. Is it okay if I interrupt you
if I have an idea or a thought coming up?
up?
>> Yeah. Yeah, of course. Feel free to. Yeah.
Yeah.
>> And again, once more, if you want to say
something, raise your hand in the chat.
>> Yeah, I I do prefer that. I prefer more
of a two-way conversation. >> Yeah.
>> Yeah.
Do share my slide.
Do I have to stop it first?
>> No, I think I've just overrided it. Can
we see that?
>> Yes. Thank you.
>> Cool. Happy days. Well, thank you for
having me. Um, you know, it's a great
introduction from Martin. Um, I I've
I've wrestled with this idea of strategy
for a long time. Um, the main sort of
premise being that, um,
what's different from civilian street to
military. So when I came out of the
military, I was very confused about um
this thing called strategy and how they
do things because it didn't make sense
to me. Um and one of the core underlying
principles that sort of made sense was
that in the military we assume chaos.
>> We just assume chaos all the time. But
wherein what I found in civilian street,
they assume stability. And that's a
really important distinction between the
two because it then Th those
perspectives then lead to how you behave
um more generally. So as thinking about
chaos, we always understand that we are
not the only people that are around and
thus we need to learn and constantly
reorientate and adapt where civilian
streets and you see this from a lot of
um sort of exec MBA sort of teachings.
they they're still in this world of
teaching um core premises that the world
is stable, the world is predictable and
the idea of linear cause relationship
which none of those are true but if you
believe they are true they are going to
shape how you um view strategy in organizations.
organizations.
So when I look at organization or
strategy I'm big believer in that we we
we need to reclaim strategy. When I say
we need to reclaim strategy, I mean when
you look forward or or look back all the
way to people like Zanzoo 300 years
before Christ to um von Mola, um John
Boyd and Cloutvitz, they had a very um
not a unique perspective of strategy but
they very much believed that strategy
was a living thing. It was a responsive
thing. was an emergent thing that um you
couldn't predict and thus you were
always constantly clear on your
intention but you had to be flexible in
your approach. Um and there's two key
things here that's missing nowadays. One
is the clear intention. Um and that
clear intention was al always based on
the relationship between um your
organization or or the entities of your
organization and what was happening in
reality. Um there is a there is a
constant sort of saying in military
about you know people talk about
strategy but professionals talk about
logistics and now what that means in
terms of the viable systems model viable
systems model the organization is
logistics and what they're saying is
that no one will create a strategy
beyond um the capability to deliver it.
So already we're starting to see that
the fact that the the two are highly
coupled and linked. But then you come
forward to today's thinking and strategy
is is merged from a an adaptable thing
an emergent thing to what is
predominantly and I'm not saying that
all it all is but predominantly with
thinking is that strategy is reduced to
um an aspiration and output. So uh
strategy has come to a thing that gets
done on a on a yearly basis and it's
produced more into a an output than an
actual thing to be lived to be done. And
you see this cuz most strategies
nowadays um they get all that cognitive
work gets put into something that
resembles a Greek villa. You know you've
got the vision statement on the top as a
house or the roof. Then you've got the
priorities as the pillars and then
you've got some behaviors down at the
bottom. And that's predominantly what
the output of any strategy engagement
becomes. Um and when you look at that,
the vision statement is often an
aspiration that is is detached from the
reality of the organization. The pillars
that underpin those tend to be what I
call um faux or fake policies.
um they are priorities that are based on
really probably should be policy um or
what they do is they get confused with
effects. They are effects that they are
hoping to achieve not necessarily um an
actual intention that for for use for
strategy. Um and then what what happens
then is there this um vague abstraction
of an idea that they would call strategy
becomes further and f further
disconnected from the reality of the
organization. There almost seems to be
this permanent wall um between the
people who conduct who created the
strategy to those that are now um meant
to execute the strategy and there's no
feedback loop between them. there is no
understanding. So they they they're
further exasperated by the perceptual
complexity, my subjective view of what
you're wanting rather than what what is
agreed. Um and that causes massive shift
or disconnect from the organization. And
then the other key point is the um
conalization of uh marketing and
branding and strategy. Um
>> I think that
strategy nowadays and also organizations
the communications in the organization
the feedback loops are being overrun and
overtaken by marketing approaches sound
bites um branding exercises that that
cause confusion and create cynicism in
the organization with the people which
then um does not help. There seems to be
this social desiraability part to
strategy where really strategy isn't
there to be socially desirable. It's
there to have an effect and that effect
normally is to um sustain advantage and
maintain viability of the organization.
And when we lose that connection,
strategy work then just becomes theater
that's disconnected from uh the reality
of the organization.
So when when we look at these things I I
overlay um udaloop. So the work by
Colonel John Boyd um and his work with
Udaloop with the viable systems model
you know udaloop being the sort of the
cognitive process of adaption and um the
VSM being structural process of
adaption. Um the two need to go because
often you see in um definitely in the
psychological world, the coaching world,
people like that they they they
forget that structure is important and
structure drives the behavior of the organization.
organization.
So you can you can take people out of a
system or you know an organization and
make them believe that they can do
something with mindset alone. But if the
if the organization the structure of the
organization is is not there to support
that activity it it will not happen. Um
and when we think about udaloop and
viable systems model we then look at you
know um
the governance system for uh five holds
the ethos of the organization the
identity. Now this is a this is an interesting
interesting
issue with strategy work that often the
layers of strategy in the organization
get confused. So we normally think about
different layers of the um strategy
being policy being the the the the sort
of ideas that shape decisions um mediate
behavior or decisions. Then you have
what we call essentially grand strategy
which in terms you would look at in what
um staff of beer um termed as posy with
the purpose of the system and that's
really the identity we're thinking about
the system what what does the
organization do um and that's quite
enduring but often
leaders go through this existential
crisis on a year year-to-year basis
where they ask that question you know
what's our purpose us, what do we do?
And they confuse strategy with that that
grand strategy and they start to confuse
this the sort of system five of an
organization and it becomes almost um
uh has a sort of schizophrenia with
identity every year. Um which is not a
good thing when you're thinking about
how how we maintain cohesion um across
the organization.
Um then we think about the orientate. So
in udloop orientation and observation we
would see sits with the um system 4 is
observation. So observation is is
looking to the external environment
looking for differences, mismatches,
patterns um and challenging itself. So
on a cognitive sense, it's really
looking um challenge your own worldview
um as as um
uh god what's his name?
Got his name now. you probably helped me
out. You know, the the your ability to
regulate the system is only good as the
model you're using to regulate the system.
system.
>> Go on a dash bin.
>> Yes, there you go. Um,
and this is what we're challenging. This
is thinking about what's our worldview.
So, we have our own personal worldview
that we look at and we challenge that by
we observe and we orientate to look for
differences, mismatches between what we
believe to be true and what's happening
in reality. And that's again the same
thing that happens with organization
around how do we main um
um autopsis. So how do we how do we
maintain that identity? How do we um
understand what adaptions we need to
make? And then you have the relationship
between um system four and system three
which is decide um which we really want
to make sure in an adaptive organization
that the gap between orientation
um and decision is is close. We don't go
into paralysis as an organization and
then also our ability to act. So the gap
AC act AC act AC act AC act AC act AC
act AC act AC act AC act um often sits
in the system one depending on the
recursive level we're talking about sits
in the system one and even with there
because it's a recursive entity they
will have their own um orient orient and
decide based on the intentions of the
higher level recursion. So the I higher
level recursion will will essentially
say this is my intention then we expect
the lower level recursions to assimilate
that and feed back okay if that's your
intention that's what you want to
achieve then um this is my understanding
of that and that's how we are planning
to act in this um context we're in and
that's a feedback loop that has to be
exist between that assimilation or that
direction to the assimilation of our
strategy to enable to ensure that we are
aligned and um the system one can act.
Otherwise what will happen is that you
create a friction called the alignment
gap. Um and when that alignment gap
happens, the unhelpful reaction from
system 3 were to seize control normally
mean that they would put more um more
protocols and processes in place um and
tighten that grip which would then
remove the ability of the system one to
respond to the changing circumstances of
of the organization or lose its ability
to absorb the variety um that is faced.
um with the changes in the in the the
local external environment they've got
so far.
>> Mike, how how often do you see that
pathology in practice that uh
disconnection between uh system 4 and
system 3 between
strategy and planning and acting?
>> Um quite a lot. Um so there's not often
a disconnect between system 4 and system
three for many reasons. Um, one of the
reasons is because um, or key reason
that we have it is is the the
understanding from those that are making
and this is where I suppose system 3
staff comes in place the understanding
of what is possible and what is actually
true in reality um, versus what they
think are completely disconnected. So
you have leaders making strategic
decisions based on a capability that
does not exist or did exist um or exists
not um as capable as they once thought.
So their their idea of what's capable is
misaligned. The other part is that
because we've been for so long um
drinking the Kool-Aid of efficiency
especially you don't have to go to look
very far for some of the big top four
consultancies you know in in England we
got Deote KPMG PWC and all those lot
great auditing firms um I'm not sure
about anything else um and what happens
because they've been dyed out on
efficiency they they make the system one
so lean it almost comes anorexic that
they they forget that that adaption
requires the same resource that they
have to deliver the value today as the
same ones to try to assimilate and make
those adaptions at the same time which
they haven't got the capacity for and
then that then um stretches the organization
organization
um beyond its change rate and then
destabilizes the organization pretty
quick. Um they're sort of the the key
reasons why um there's a disconnect
there and and there are other stuff
about risk um risk tolerance um and
you and we'll we'll talk more about um
the organization's ability to observe.
Does that does that make sense?
>> Yep. Absolutely. Thanks. >> Cool.
>> Cool.
So when we um look at and this is a
simple view and I'll go into the other
view of of um of
uh the VSSM a bit more but you can see
the components in there. You've got the
system four in the strategy in the or
change and then you've got the system 3
system one in the um in the
organization. Um and what we do is we
talk about the two-way relationship that
needs to exist or the two perspectives
there. There are two perspectives
looking at relationship between the
organization and strategy. The both are
true. So you got the strategy. So
as I mentioned before, often strategy is developed
developed
um in sort of an echo chamber detached
away from the organization. So it's
almost as if aspiration will trump
anything. Where if you look at it,
you've got the strategy into the
organization. So the strategy shapes the
intended behavior to carry out a
maneuver. Um so what we mean by that is
that the any changes that you have in
the um or strategy that you conceive
that will in turn change the
organization. So when you conceive
strategy, you will then look and you go,
well, we've we've we've already got the
capability, we just need to direct it in
a different way or we've we've we
haven't got the capability, so we need
to to create that capability and then
thus you then have organizational change
that you need to bring into the organization.
organization.
>> Hang on, wait a minute. Yes, that's an
interesting aspect. I see we see the
arrows going into both directions. I
think that's interesting. We will we
know about one direction structure
follow strategy right Roman uh Chandler
and uh the other uh arrow somehow says
well what you develop a strategy for
depends on and how you develop a
strategy depends on your structure on
your organization on the other hand how
you deal with that
>> well that's that's the thing about
organization is what con conceives the
strategy in the first place so If when
we're thinking about strategists or um
people making a strategy, we we we we
I'm suppose I'm making the assumption
the assumption is that they should
understand the limits of the organization.
organization.
>> Um and this is where I see a fault or
flaw or a a disconnect as you can see um
in these two arrows going between the um
strategy and the organization. there
normally tends to be a disconnect um and
they'll start to create strategy that is
beyond the capability first conceived by
the organization.
>> So then the organization will fail to
meet that strategy and our unhelpful
response then is to just demand more
>> and then you destabilize the
organization. But we must always be very
cognizant and this is where VSSM is
really useful because VSSM
shows you if you do it correctly how the
organization actually works and the
capacity of the organization to do
certain things like what the outcomes um
expected what inputs it should have. Um
but it's the structures and processes
and relationship that sets the boundary
about what is possible. um the actual
strategies that emerge are direct
reflection of the organization's
existing coupling. So the organization
as we think about in Berto Matano, the
organization is structurally coupled to
the external environment. Um changes the
external environment change the
organization. Uh changes the
organization change the external
environment and we must wear that. But
the the the
strategy that is being created
must be made in the relation of of
what's capable of the organization.
>> Yeah. If the c if the if the
organization is not capable then you
need to think about adjusting the
strategy um point and what I'm not
saying is that you remove ambition it's
not is that the ambition needs to be
matched by what's possible
>> um and that just means that if if you're
creating a strategy um that is beyond
the capability then you need to adjust
you adjust that by the change rate you
know what you're doing is there is there
possible strategies you can you can
achieve first um and then in that sense
um creates options
um or you you just slow the tempo down
for what's what's actually good. But
you've got to otherwise if you don't um
you'll exceed the capability of the
organization and then you'll start to to
destroy it. And and what tends to happen
with this because the structure becomes
disconnected um and then you're trying
to force this you create more of what
staff of beer used to call um
pathological autopsis.
>> Yeah. We then start to create separate
entities that are there to solve a
problem that is normally due to a lack
of the disconnection between strategy
and organization and then they become
self-creating um and they create this
bureaucratic mess or what um uh John
Boyd calls internal inertia which then
means that the the organization itself
is is is
trying to fight internally more than it
is capable of actually delivering
anything outside and you lose this this
connection. And it has to be about the
adaptation of the the organization over
time because as we see the strategy is
focused is focused on the the future.
And what we're trying to do is get the
strategy or the direction to the
organization to redirect the capability
or to change in time so that when the
future becomes now the present
ecosystem, the organization is ready and
capable for it. What happens when you
don't have that and you're missing that
strategy or the system for loop is that
the organization is not ready for the
change um for the present ecosystem.
still based on the old ecosystem that
then it now as Mike Tyson says they got
punched in the face and they get punched
in the face very quickly and they have
to go through this cycle far quicker
than they are capable. So they have to
to redirect capability. They have to
create capability which far exceeds
their change rate. Um and then you you
start to see the organization
um turn inward and typically also very
different uh competencies like uh in the
mo in in the mobility automotive industry
industry
uh competence regarding software divide
vehicle versus combustion engines or we
know the history about codec about
digital or chemical photography. So what
we're actually talking about here is the
the ambidextry the balance between
system three and four isn't it? Yes,
has to be there. But this is what
confuses it a lot in uh in organizations
as we go to this one where we talk about
um bringing in and apologies my my um my
own self-drawing of the viable sisters
model but I'm I'm no artist or
definitely no PowerPoint person
>> and and this is the thing so when when
people think about strategy in
organizations or strategy has become
this thing if it's important uh it gets
called strategy which then confuses
things um extremely much especially when
you're thinking about um you know the
automotive industry going from
combustion to electric that is
completely different capability than
they already had. So when we say an
organization there is a strategy and any
of the subsequent parts and enablers in
the organization then need to assimilate
to how they um will meet that strategy.
What tends to happen and I've been at a
conference all day today and mainly with
um organizational development people or
um organizational psychologists and they
throw away terms like our people
strategy, our culture strategy, our this
strategy. The problem is you confuse it
and it's not a strategy. what what the
people conceive in the different
departments especially the enabling
departments that sit in you know maybe
system three and system four they are
not creating strategy they are
assimilating the strategy in the sense
that the or observation and orientation
has been done and the decision is being
made and now they must then all the
subsequent parts must then figure out
well if that's the strategy then what's
my part I playing it and what needs to
change versus what needs to stay stable
um to enable us to meet the the changes
in the ecosystem we're operating and we
add value in um in time.
And and when we have this separation
uh where we start to term everything a
strategy, we actually don't we we we
break the organization and we create
conflict and we lose all coordinization
that needs to exist um for these primary
activities to to develop and to also um
maintain value as they're as they're
Does that make sense?
>> Absolutely. Thank you. >> Yeah.
>> Yeah.
>> Absolutely. Yes.
>> Yeah. So when we think about the um the
relationship there, we have the the idea
of you know system 4, we all know we all
know that they are the ones that are
observing, they're orientating and they
create the strategy. And then it's the
it's the it's the balance where we need
to go through through system three into
um into the system one for them to
actually act. Now what the viable system
does it does it provides a great lens to
understand how we enable that adaption.
Um because the if you if you look at
viable systems model in in the fact that
Stafford beer thought about which was
that all the system one activities we
want to ensure that they are autonomous
as possible. They are the self they're self-organizing.
self-organizing.
What that does is it gives us a great um
window into helping us understand the
principle of mission command that was
created by von malta and how that
actually exists in real life in
organizations. So von molta talked about
uh mission command a philosophy a way of
thinking u about um execution and that
was about adaptability.
Stafford beer was talking about the same
thing but in a structural term. So when
you look at it you have um from the sort
of vertical cohesion. So unity of effort
and trust which is created from system 5
to system 3 to ensure that we are cohes
we have got that ability to stay
cohesive and adapt without losing our
identity. we have that clear unambiguous
um uni u unity of effort like what what
is it that we are trying to achieve as
an organization
then we have um what is crucial in that
relationship between three and four is
that timely effective decision-m so that
we can balance out that so we don't have
this delay where system four is and
system three are arguing about what they
are to do and what they aren't to do and
I suppose it's where we we think about a
system five to make that clear decision
about what is what is best for the
organization, the long-term viability of
the organization and make those
difficult decisions about choices about
what's what are we going to focus our
limited resources towards um and and why
are we doing that.
But the key thing for this is to make
sure that the the entities the primary
one activities that primary one the
system one activities that are um are
relating with the present ecosystem is
that they are decentralized.
So to making sure that the we protect
the ability for these entities to act
and that is um in strategy execution
that is um paramount. if they don't have
the ability or the resources or decision
rights to be decentralized and have the
ability to um have agency and to act to
change the circumstances.
um you will not be able to achieve um
the strategy in any sort of timely
manner or in a way because if we define
the how the decisions too high up which
tends to happen it removes um any
freedom of action from the system one
which means then in in Rashby's term
they don't have the ability to absorb
the variety or the the all the choices
that will be presented with them because
we can't predict that all we can all we
can provide is the intent. I this is the
outcome in which I want you to achieve
not how but this is the outcome and then
allow the system on activities to to
interact with the external environment
to understand how it meets reality and
then be able to um observe reorientate
and adjust in line with the intent and
the um the constraints imposed.
um without this we won't get the freedom
of action and initiative that was
required to seize those opportunities
what that will take place beautifully
beautifully demonstrated I think that uh
rings a bell also with Peter Ducker's
management by objectives and
self-control and maybe today's OKR and
it rings also a bell with that uh I
don't know what that that's that saying
from like uh it says unity in essentials
freedom in action and in all trust. >> Yes.
>> Yes.
>> Very thing. I think that's very nicely
displayed here as well.
>> Yes. Um Malik, you do you got a hand up?
>> Yeah. I just had a question. It's um
it's very well laid out. I I love this.
I'm currently struggling myself in my
current company. I have something
similar to that happening somewhere
where there is a mismatch of the the the
strategy and what we're capable of.
Yeah. But um that's why I got recently
into process organization studies and I
think a big key part that's uh often
overlooked is uh how do you actually
communicate that like the execution what
do you understand under execution is um
I would love to have your opinion on
that cuz I got more into like discourse
and discursive strategies and stuff like
that and um yeah just would love to hear
your opinion on
Yes. So that's a really good question
and this this this bit helps us to
understand that. So when when you have
the the the leaders or whoever the
system for whoever's conceiving the
strategy they they are
first they they must understand one like
we said the capability of the
organization and two their relationship
with the external environment um and
realizing that you know they are they
are not alone. So in the military sense
we've always known that there is us and
there is enemy and there is um NOS's and
there are civilians there are all these
things that we must understand our
relationship with and by understanding
the relationship with with them we can
understand um what we need to achieve to
remain viable in the external
environment but also to our advantage.
Um a great way to look at this is um uh
or the closest way to look at this and
probably yeah a really good way to look
at this is Patrick Harvestat's um Pat
strategy to understand how strategy
emerges from there. So once they
understand that they understand what
they are to achieve. So if you if I use
an example for instance um um Elon Musk
so Elon Musk um back in the day when
Tesla wasn't so greatly known um when
when when the people in Tesla were
looking at strategy they were looking at
the external environment and they can
see quite easily there was a pattern
emerging which is that majority of the
um EV world cars um EV was very
expensive and it wasn't going to become
you know, cheap by anytime anytime soon,
but they were trying to make affordable
cars. So, Toyota and all this stuff. So,
they saw an opportunity for an advantage
was that we're not going to make
affordable cars, we are going to make
performance cars, expensive high
performance cars.
And that's what they to do that so they
know if they could achieve that, they
will have um an advantage and be viable
in the external environment. So as they
take that in to system 4 to orientate
that that is the direction they give. So
when they come to their people so
they'll have their um HR departments,
their R&D departments, you know, they
have their the their the system one
functions all these lot that are in
there. They would brief and say our
intention is
you know to do this by means of and that
by means of is is on a high level on the
highest recursive level how they are
going to do that across their
organization. And then what we call um
what ends it is which in order to and
this is where effects come in and
effects are really important um because
effects are what we are going to see in
this external environment. If we don't
understand what we're going to see by
the meanings of our changes then we're
not to know what's actually happened or
not. So effects are really important for
that re reobservation orientation. So to
enable that execution, what we would do
is we would give that clear intent and
we would give constraints. So
constraints are a good thing. Um they're
not all bad constraints. Sometimes
constraints are good. I.e. there's going
to be financial constraints. They're
going to be personnel constraints, all
that stuff. Then what we then do with
that is we we say to these um you know
system three or system one is say okay
that's what we want. And we give them
space to assimilate what that means. And
they then have to once they've done
through and we look at what we mean by
that is that one they understand the
situation. How does it affect them? They
they analyze or do what we do call
mission uh mission analysis. They understand
understand
what they've been told to do and why. So
what's implied, what's explicit, what's
their freedoms, what's their
constraints, what risks they face. At
that point that will indicate what part
they are going to do in their element um
be it R&D department be it in the
manufacturing to execute that part of
the strategy and they would then replay
that back and this is the crucial
feedback loop that needs to um happen to
ensure that the they have alignment
around expectations
and you would expect to see that happen
at each recursive level. So as von
Molter says the higher you are the
shorter your order and then the granularity
granularity
um gets developed closer to the edge of
the organization or closest to um the
interaction with the external environment.
environment.
>> The higher you are the shorter your
order. Can you help me to understand that?
that?
>> So what that's saying is that the higher
we are I don't go into the detail. I'll
give you what I want to achieve. I see
>> how not how you want to achieve.
>> I understand. Yeah.
>> Yeah. So as as it then gets assimilated
and understood the granularity the
detail will will be developed because if
we don't do it that way and we we make
the decisions at high level and we give
that strict direction down we've removed
the decentralization from the um system
one and then when they go to interact
because it's so defined
um the likelihood of that still being
true by the time it gets um interacts will
will
be false. So then they will have no
other options. So then they would have
to then go back up the chain up the
system to ask okay that's that's not
possible anymore. What do you want me to
do next? And it would slow it down.
Where if we say this is what we want you
to do and this is the constraints that
then gives them the opportunity to adapt.
adapt. >> Yeah.
>> Yeah.
>> Does that answer your question?
>> Absolutely. That's the opposite of
micromanagement I'd say. Right.
>> Yes. Yeah. And and and that's what we
call um enabling the freedom of action
or we we must protect the freedom of
action within um within the the system
one activities. If you remove the
freedom of action um in the system one
activities um you will
um they will not be able to respond to
the change of circumstances. And this is
where system two becomes ever so
important because we want to assu we
want to make sure that as we as we go to
execute they still have this they still
have choice but we're making sure that
their choices don't conflict with each other.
other.
>> That's understood. What I find
interesting in this picture also is that
we have strategy in system four here.
>> Yes. And we have system ones which also
have strategies right about their
environment their specific environment
that distinction between
what our strategy made for. Do we have
for each recursion level its own
strategy or is there just one strategy
and just execution on the lower level of
of recursion? I I observe that quite a
lot in practice. Do do you agree with
that? Yeah, I I I believe that there can
be strategies but the strate but there
is a strategy that at the the highest
level. So an organization
>> um can have multiple strategies going on
at one point. Obviously the more
strategies you go have going on at one
at one time the the more complex you
make it
>> um and more resources you need but when
you think about the lower levels of
recursive level it's still aligned to
the same strategy. All it is is that
they're looking at and going, "Well,
what's my part that I have to play in
the strategy?" Yeah. >> Exactly.
>> Exactly.
>> And where the disconnect happens is that
that's not how it's formed. So, normally
if you see an organization, you have
this berser perverse nature of them
almost creating their own strategy and
then trying to play some sort of mental
gymnastics, convince themsel that they
are aligned to what the direction is.
Yeah. Very good. Yes.
>> Then you you get this um huge disconnect
between what's happening or how the
system one activities are interacting
with the external environment and what
they're expecting to see and the two
don't match.
>> I think that's a topic where the VSSM
really helps and that's a really big big
problem. What I see in practice is that
either you have on the system on on the
system in focus just an aggregation of
the strategies of your system one or
then the other way around you have a
complete strategy for your system focus
and then just the execution on the lower
level. So these two pathologies I see
them almost in every case. >> Yeah.
>> Yeah.
>> Yeah. and it break and e strategy and
execution are um is a is a thing where
it it becomes more of a problem that
people make it more of a problem than it
is. It's it's a it's a disconnect and it
all really starts from um well two
points. One is that the the strategy
conceived is um is not really a
strategy. It's um it's an aspirational
um abstraction that has no basis in
reality. So they've created it um
not in not in recognition of its
relationship to the external environment
nor in the relationship to the internal
environment. So
>> yeah, sorry. It typically will start
with with the word vision. Right. That's
why I word too much.
>> Yeah. I I'm I I am not a fan of that. um
word vision >> um
>> um
>> neither neither am I.
>> Yeah. And um and the reason why is
because it doesn't give clarity of
direction and the strategy must give
clarity of direction to enable the
subsequent parts of the organization to
to be able to assimilate and understand
what they need to do. If if they don't
and it just remains this marketing plan,
um it's like um who was I speaking to
today? Um, that was it. So, they're a
banking organization in in the UK and
they told me their p per their purpose
statement is a prosperous um UK.
So, so my thing to them was like, okay,
that's interesting. How >> Mhm.
>> Mhm.
>> how how do your actions make a
prosperous um UK? And if that's your
strategy, how is that even possible?
what effects how would you know that
you've created that when you've you you
interact with the external environment
and this is where we talk about um and
the whole idea around my book and the
podcast is when strategy meets reality.
Now you can conceive all that you want
and you could create this lovely aspiration
aspiration
but it will never meet reality. will
never translate into here and all it
will do is create dysfunction and that
dysfunction will become a detached organization
organization
which then will be followed by internal
inertia um and pathological pieces
because when we when we start seeing
gaps between what we wanted to happen
what actually happened and um the
difference between what we wanted
someone to do and what we actually did
our unhelpful reaction as an
organization is to put more policies
more processes in place to try and
control the actions of system one
thinking that they are uncapable. But
it's not that they're uncapable, it's
more that they they there's there's no
relationship there and there's no
feedback loop to what happens
>> regarding timely and effective decision
making. Mike, is it also your
observations that they very often have
these kinds of fixed time horizons like
they say we now develop the strategy
2030 because we look five years ahead
and that's our strategy and that's our
goal and our ambition and then somebody
comes up and asks and what later on what
happens next or something. That's my
observation at least. How how do you
respond to that?
>> Yeah, I agree. I think this um the the
5year horizon that tends to be is just a
mental construct that um I believe
actually came out of um communism to be
fair on the agricultural timelines. Um,
so it's just a construct. It's it's not
real. But there is there is a space for
future thinking. And you see this in my
model where I'm talking about the
contextual environment, how the future
will impact the transactional
environment then come into the present.
So I'm all for the fact that you will
look at scenarios and think what's possible.
possible.
But this needs to be grounded. If you're
looking, you know, at at 2030 or you're
looking at 20 uh 40,
that should only be serviced to um
understand what is possible in decision-
making today. If any future activity
does not serve to answer decisions
today, then it's it's just an um it's
just a stargazing exercise and it's not
useful. So it should then provide you
with and this is where the relationship
between system 4 and the system one in
the activities because it's the
construct of the organization in your
capability which then enables the uh
adjacent possibles or the affordances
that you can make today and you could
make those today that should then start
to shape what's possible in the future.
Let me just root that in practice a
little bit because my observations is
exactly about that in the last years in
the German industry at least or the
European industry I even would say is that
that
suddenly something happens completely
unexpected. I mean could be the in the
in the in the automotive industry a
mobility show in in Asia for example or
could be uh just a disruption with Paul
politics or or the geopolitical
things or so um something happens and
then it's typically as synchronized
with strategy and planning processes. So
uh they don't have the processes set up
to really adapt in real time or in
requisite variety as as Ashby would say
what is happening outside or the the the
the famous citation comes to mind um
Alfred Sloan it was I think uh if the
rate of change outside exceeds the rate
of change inside the end is inside.
>> Yes. Right.
>> I observe that very often today.
>> Yeah. you know the viability principle
you must be able to adapt as quick as or
quicker than the external environment or
the competitors otherwise you cease to
be viable and to enable that to happen
is is why we must protect the system one
um entities to one act so they can
respond to the changes because the
intent won't change. So what they're
what they're doing their intent won't
change. How they do that will adapt and
you're giving them the freedom to adapt.
And the second part is that that part of
the um the the uh system 4 and this is
what I was saying earlier about strategy
is not an output and you see that
behavior a lot that rigidity
um of thinking or the rigidity rigidity
of adaption due to the fact that they um
they they view consciously or
unconsciously strategy as an output not
a way of being. So if there's a way of
being you would have a consistent um
observation and orientation of the
system 4 and you would then go to truly
what staff beer was talking about and I
suppose in Berto Matiano
about adaptions rather than transformations
transformations
>> who would take care in the company about
that Mike who care about in the company
>> that happens what you're
Yeah, I I would say it need it needs to
be at the um it needs to happen in
several places in the organization. So
it needs to happen at the the exact
which you would expect it bordering
around system 4 and system three. But
you you need to have that recursive
nature happening in the organization so
that the system one or as you recur as
you go through recursion that they
replicate that ability to observe and
orientate throughout the organization to
understand their part. If it is just
solely at the highest level of recursion
which I normally see and then the rest
are just a slave waiting for direction
that won't happen. But
the the the leadership, they need to be
in tuned. But what you find, and I've
noticed this quite a lot, and I think I
don't quote me on the statistic because
um I saw it, and it was really
interesting, and I forgot to note down
the the where it came from, but they
were looking and they said that the
average exec team spends an only an hour
a month looking at anything that is
considered external or future.
>> Yeah. which is which is not good because
I want to know what are they dealing
with and I understand because I've been
in a lot of organizations and what you
find is that the organization is constantined
constantined
so that the people that should be
dealing with observ the observation
orientation of the organization to
provide that direction that uh that
adaption aren't doing that. they they
are fully locked in to um crisis that
are happening in at the the the lower
level recursions.
>> Yes. Yes. Mike, I I would like to open
it now for discussion with the
participants or is there is there
another five minutes that you would like
to use to to show an idea or something
or or
>> Oh, no. I I I talked through it all. I
sort of just went with it. Um but that's
the end of my slides anyway. So, I'll
I'll stop sharing.
>> It's flying. It's very interesting.
Maybe you can uh leave your your your
slides on the screen.
>> Oh, can you? Yeah, I can do that. I'll
put it back up so people can see.
>> So, uh yes, please. I would like to open
it up for for everybody. Just raise your
hand and just Yeah, maybe you raise your
hand and then we have I think first I
don't see a sequence here. I start with
Adam Walls, please.
>> Uh hi. Um really interesting and very
theoretical. Um I work in R&D for a
enterprise architecture platform company
and I'm developing tools to implement
BSM but without telling anyone
>> because I think that the problem you
face here is that you have to teach
everybody cybernetics.
The language you use is not not
accessible to most people outside of
this small group. I would suggest and
maybe a very a very narrow group of
people who could I'm sorry so I'm not
I'm not attacking you I'm just making
observations so just I'll get
>> I'll get to the question I'll get to the question
question
>> so do you believe that VSSM is a structure
>> um so to first point I I just sort of um
put my language to the audience but if I
was talking to people that aren't um CSM
I probably would use more of the
language around execution
um as a as a personal act than
structure. To your point around VSSM, is
VSSM a structure? VSSM is a is a lens to
look at structure.
>> It's just you you you talked about
higher and lower and I don't believe
that any there is a hierarchy here. I
think that this is uh all of these uh uh
systems or subsystems that exist and
it's the interconnection and
interdependency between them. It's like
saying is your heart is your heart more
important than your liver and I just wondered
wondered
>> in terms of
>> it's more the extraction of detail than
um higher or lower. So with anything of
of focus in in strategy um it's a
substant part. So if you're thinking
about um you know my background military
you know I' I've got the sort of the
brigade headquarters they're looking at
the the wider piece of the battle where
the parts of that piece the parts they
have available to them they are not focusing on the whole um whole battle
focusing on the whole um whole battle they're or the whole war they're
they're or the whole war they're focusing on their part of the battle and
focusing on their part of the battle and that's what I'm talking about in a sense
that's what I'm talking about in a sense that it's the collective achievement of
that it's the collective achievement of them that achieves the strategy rather
them that achieves the strategy rather than there being the lower higher part
than there being the lower higher part of it. They just have a part to play due
of it. They just have a part to play due to their specialist or their their their
to their specialist or their their their focus that they have currently in in in
focus that they have currently in in in that that battle space. Yeah, let me
that that battle space. Yeah, let me just uh jump in as a moderator very
just uh jump in as a moderator very quickly. But that's a very often and
quickly. But that's a very often and well discussed question actually often
well discussed question actually often discussed question. Is there hierarchy
discussed question. Is there hierarchy in the Bible system model? And I just
in the Bible system model? And I just would like to raise your attention to
would like to raise your attention to the fact that it depends on how you look
the fact that it depends on how you look at it because uh what is hierarchy? If
at it because uh what is hierarchy? If you deep the if if you say hierarchy
you deep the if if you say hierarchy from power and and and influence and so
from power and and and influence and so on that's one side and there's also a
on that's one side and there's also a hierarchy maybe from the logical aspects
hierarchy maybe from the logical aspects of information and uh these are two
of information and uh these are two things think different things but we
things think different things but we could spend an evening on discussing
could spend an evening on discussing that question I guess
that question I guess >> yeah thank you yeah I think in that
>> yeah thank you yeah I think in that sense of hierarchy it's more about um
sense of hierarchy it's more about um decision rights and information flows
decision rights and information flows rather than a traditional you know it
rather than a traditional you know it must go in that way um I It's about how
must go in that way um I It's about how you and that's why it's a lens to look
you and that's why it's a lens to look at structure rather than be in the
at structure rather than be in the structure because you you're looking and
structure because you you're looking and making sure that your organization um
making sure that your organization um can can be viable in the in the
can can be viable in the in the environment that it's operating in.
environment that it's operating in. >> Yes. Hierarchy comes from the relevance
>> Yes. Hierarchy comes from the relevance of information if it's in a healthy
of information if it's in a healthy system. I'd say excellent. Thank you
system. I'd say excellent. Thank you very much. Then we have Ben, please.
very much. Then we have Ben, please. >> Yes sir. So uh that was outstanding
>> Yes sir. So uh that was outstanding Mike. Just absolutely outstanding. So
Mike. Just absolutely outstanding. So You know, I'm long time in construction
You know, I'm long time in construction and a lot of complex projects, project
and a lot of complex projects, project manager, and um left the industry about
manager, and um left the industry about seven months ago to start my own
seven months ago to start my own consultancy to do systems interventions.
consultancy to do systems interventions. Uh go back into that world. And so very
Uh go back into that world. And so very much trying to build a framework heavily
much trying to build a framework heavily influenced by VSM. There was not a thing
influenced by VSM. There was not a thing I heard here today that I couldn't
I heard here today that I couldn't immediately apply to 100 situations from
immediately apply to 100 situations from my own empirical experience. So I'll
my own empirical experience. So I'll just focus on a couple things. I don't
just focus on a couple things. I don't have a question. just kind of want to
have a question. just kind of want to just like I could spend I'd like to have
just like I could spend I'd like to have three hours to talk about every every
three hours to talk about every every single point on your on your slide but
single point on your on your slide but uh just to focus on the dis the idea of
uh just to focus on the dis the idea of disconnect right so reality versus
disconnect right so reality versus abstraction I look back on even at the
abstraction I look back on even at the most mature parts of my career towards
most mature parts of my career towards the end I was spending most of my time
the end I was spending most of my time on perception management all right with
on perception management all right with of the stakeholders where I I had perce
of the stakeholders where I I had perce you know I had they had their their
you know I had they had their their abstracted idea of what what should be
abstracted idea of what what should be what ought based on often times on a
what ought based on often times on a schedule that was artificially
schedule that was artificially fabricated in an ivory tower echo
fabricated in an ivory tower echo chamber and uh and then so I'd very much
chamber and uh and then so I'd very much be managing reality on one end and then
be managing reality on one end and then managing their perceptions on the other
managing their perceptions on the other and so I I read a quote recently in one
and so I I read a quote recently in one of Ilia Priagene's books but he was
of Ilia Priagene's books but he was quoting Carl Pauper and he was saying
quoting Carl Pauper and he was saying that we use we focus on uh we use clock
that we use we focus on uh we use clock science where we ought use cloud science
science where we ought use cloud science and he's talking about probability
and he's talking about probability versus certainty and And uh so what you
versus certainty and And uh so what you said in the very beginning about um
said in the very beginning about um assuming stability in the civilian
assuming stability in the civilian world, you know, and in construction,
world, you know, and in construction, it's so perverse that uh that we still
it's so perverse that uh that we still haven't caught on to that that
haven't caught on to that that everything we're managing is is change
everything we're managing is is change and chaos and and complexity yet. Yet at
and chaos and and complexity yet. Yet at once a week I would be in meetings with
once a week I would be in meetings with senior stakeholders having to answer to
senior stakeholders having to answer to some you know some deviation in the
some you know some deviation in the schedule that was h very often caused by
schedule that was h very often caused by a dozen or so different things and and
a dozen or so different things and and then giving this an artificial so it
then giving this an artificial so it became theater you know to your point
became theater you know to your point >> but um just that disconnect the ideas of
>> but um just that disconnect the ideas of uh
uh >> of of treating of treating very complex
>> of of treating of treating very complex of treating those things that are
of treating those things that are uncertain as if they can be certainly
uncertain as if they can be certainly decided and and so last thing I'll say
decided and and so last thing I'll say is a schedule is our model of reality
is a schedule is our model of reality And it's a complete abstraction and it's
And it's a complete abstraction and it's almost never the idea of the feedback
almost never the idea of the feedback being insulated. You know, I was reading
being insulated. You know, I was reading Angela's book, Get Ready for Her Course,
Angela's book, Get Ready for Her Course, which she talked about one of Stafford
which she talked about one of Stafford Beer's quotes. I'll butcher it, but it's
Beer's quotes. I'll butcher it, but it's like about the the ultimate attenuator
like about the the ultimate attenuator or the fatal attenuator being ignored
or the fatal attenuator being ignored feedback. I mean, that's just the status
feedback. I mean, that's just the status quo in construction. I mean, it's uh you
quo in construction. I mean, it's uh you know, I spent most of my career out in
know, I spent most of my career out in the field as the on-site project manager
the field as the on-site project manager trying to talk to the home office about
trying to talk to the home office about what was really happening and our real
what was really happening and our real real cap our actual capabilities, you
real cap our actual capabilities, you know, and that gap. So that disconnect
know, and that gap. So that disconnect man you just spoke to my soul.
man you just spoke to my soul. >> Yeah. Can we agree with that statement?
>> Yeah. Can we agree with that statement? Is there a question also you want to
Is there a question also you want to pose or?
pose or? >> Not really. That's it. So just great
>> Not really. That's it. So just great great stuff.
great stuff. >> Oh jeez.
>> Oh jeez. >> Thank you very much Gloria and Frank
>> Thank you very much Gloria and Frank please. Good night. Good evening.
please. Good night. Good evening. >> Hi. Uh so thanks for explaining this. um
>> Hi. Uh so thanks for explaining this. um this this all seems to be very much
this this all seems to be very much reliant on the capabilities that are in
reliant on the capabilities that are in the organization and the people that
the organization and the people that carry these processes. Can you outline
carry these processes. Can you outline how when implementing this how this
how when implementing this how this Yeah. gathering of capabilities with the
Yeah. gathering of capabilities with the people and the leadership looks like?
people and the leadership looks like? >> Because managing these managing these
>> Because managing these managing these processes and the organization and stuff
processes and the organization and stuff is not something that at least at my
is not something that at least at my workplace the people are not used to
workplace the people are not used to that. How how can we reach a point where
that. How how can we reach a point where this level of maturity is reached? Well,
this level of maturity is reached? Well, I think there's um there there's often a
I think there's um there there's often a a problem in and I suppose it's the um
a problem in and I suppose it's the um the the emergence of the organization as
the the emergence of the organization as it goes through and changes and adapts
it goes through and changes and adapts that we have um
that we have um per perverse behavior of trying to adapt
per perverse behavior of trying to adapt organizations or allowing them to adapt
organizations or allowing them to adapt to personality
to personality rather than what the thing should do. So
rather than what the thing should do. So we lose grip about the organization and
we lose grip about the organization and we it starts to over time develop an
we it starts to over time develop an immersion to something that is not
immersion to something that is not helpful rather than are we are we clear
helpful rather than are we are we clear on you know definitely when we think
on you know definitely when we think about the I know we got system one but
about the I know we got system one but if you think about a function in there
if you think about a function in there you know Adam said he's from R&D well I
you know Adam said he's from R&D well I I'll be very clear about you know what
I'll be very clear about you know what what should that do and then what should
what should that do and then what should be the outcome
be the outcome um yeah um Sorry, kicking me out. Um and
um yeah um Sorry, kicking me out. Um and and what should
and what should um and what should uh what the outcomes
um and what should uh what the outcomes expected have a clear understanding
expected have a clear understanding about and the decision rights. This
about and the decision rights. This gives us a better idea of what the thing
gives us a better idea of what the thing should do, not what um a subjective
should do, not what um a subjective level of what it does. But but when
level of what it does. But but when you're thinking about when you're giving
you're thinking about when you're giving that direction, I think there's this
that direction, I think there's this fallacy that the leader um should know
fallacy that the leader um should know everything in detail.
everything in detail. Well, I'm not I'm not needing to know
Well, I'm not I'm not needing to know everything in detail. I just need to
everything in detail. I just need to know really roughly what what is it that
know really roughly what what is it that this organization should do the highest
this organization should do the highest level. And it's the feedback. It's it's
level. And it's the feedback. It's it's the it's the conversation or the two-way
the it's the conversation or the two-way conversation. We call it command and
conversation. We call it command and control in the army. And I know command
control in the army. And I know command and control has a negative um
and control has a negative um terminology in civilian street, but it
terminology in civilian street, but it does is not is not a negative thing.
does is not is not a negative thing. Command and control is that I'm going to
Command and control is that I'm going to give you in clear unambiguous intention
give you in clear unambiguous intention about what I want to happen. It's the
about what I want to happen. It's the relationship between me and that person
relationship between me and that person to have that conversation to go actually
to have that conversation to go actually I understand what you want but this is
I understand what you want but this is what we're capable of delivering at this
what we're capable of delivering at this stage. It's all I'd say also about how
stage. It's all I'd say also about how you deal with variety, right? These are
you deal with variety, right? These are all damping varieties. And my
all damping varieties. And my observation with the viable system model
observation with the viable system model actually is that it's a language. It's a
actually is that it's a language. It's a kind of understanding what we're
kind of understanding what we're actually do in our steering in our
actually do in our steering in our decision making. And that kind of
decision making. And that kind of understanding is the key to
understanding is the key to implementation because implementation
implementation because implementation looks different in every organization.
looks different in every organization. There's no general recipe I think.
There's no general recipe I think. >> Yeah,
>> Yeah, >> that's an observant. Do you do you share
>> that's an observant. Do you do you share that?
that? >> Yeah. And that's why you must have that
>> Yeah. And that's why you must have that um two-way conversation. So, you're
um two-way conversation. So, you're giving the uh the the direction. They go
giving the uh the the direction. They go away and look at and they feed back and
away and look at and they feed back and they say, "Do you know what, Floren? I I
they say, "Do you know what, Floren? I I know what you wanted. This is this is my
know what you wanted. This is this is my this is what we're going to do. This is
this is what we're going to do. This is what we can do or this this is what
what we can do or this this is what we're going to do to do that."
we're going to do to do that." >> Yeah.
>> Yeah. >> I'm I'm constrained by this. If you're
>> I'm I'm constrained by this. If you're happy to remove that constraint, I can
happy to remove that constraint, I can do this. if not this is what we're going
do this. if not this is what we're going to do and this is the what timeline
to do and this is the what timeline we're expected and that's where that
we're expected and that's where that that system three um bargaining is
that system three um bargaining is really important about what's been asked
really important about what's been asked to do versus time and resource
to do versus time and resource >> so it's it's it's that conversation if
>> so it's it's it's that conversation if you don't have that conversation then we
you don't have that conversation then we don't know what's possible if you come
don't know what's possible if you come back and say you know I can't do that
back and say you know I can't do that cuz I haven't got that capability then
cuz I haven't got that capability then that's where we then go into change and
that's where we then go into change and we have to create that capability and
we have to create that capability and that's where the the feedback costs come
that's where the the feedback costs come back to see versus what is conceived
back to see versus what is conceived versus what is reality.
versus what is reality. >> John Lee, please. Good evening, John
>> John Lee, please. Good evening, John Lee.
Lee. >> Uh, good morning. I'm in California.
>> Uh, good morning. I'm in California. Thank you very much, Mike. It it was a
Thank you very much, Mike. It it was a really excellent articulation of
really excellent articulation of Stafford and many of the people that
Stafford and many of the people that he's worked with and I thought you did
he's worked with and I thought you did an excellent job. I want to make one
an excellent job. I want to make one point and that is I think most
point and that is I think most organizations live in 321.
organizations live in 321. Most organizations if you were to draw
Most organizations if you were to draw the graphic according to the emphasis
the graphic according to the emphasis system
system four would be tiny
four would be tiny >> and he calls that a a I forgot the word
>> and he calls that a a I forgot the word but a cat without a brain. So basically
but a cat without a brain. So basically the five gets collapsed down into the
the five gets collapsed down into the three because as you said only once a
three because as you said only once a year does system four exist at all and
year does system four exist at all and then you presuppose that it was correct
then you presuppose that it was correct and then you keep pointing back to what
and then you keep pointing back to what it was. So one of Stafford's graphics is
it was. So one of Stafford's graphics is you change the situation changes but
you change the situation changes but your model stays the same.
your model stays the same. >> Same. Yeah. And so the example that he
>> Same. Yeah. And so the example that he uses is what's the last time you talked
uses is what's the last time you talked to your children? Because they've
to your children? Because they've obviously changed a lot since the last
obviously changed a lot since the last time you talked to them, no matter how
time you talked to them, no matter how old they are. But the last point I'll
old they are. But the last point I'll make is that most organizations assume
make is that most organizations assume that the environment is static. They
that the environment is static. They don't assume it's dynamic. So they go
don't assume it's dynamic. So they go through the year assuming that the way
through the year assuming that the way the environment looked a year ago is
the environment looked a year ago is still how it is. And it's actually the
still how it is. And it's actually the system for's interaction with the
system for's interaction with the environment. That's the contribution it
environment. That's the contribution it makes back to the 321. But the one is
makes back to the 321. But the one is dealing with adaptation on a day-to-day
dealing with adaptation on a day-to-day basis.
basis. >> I thought you did an excellent job of
>> I thought you did an excellent job of expressing what I just said.
expressing what I just said. >> Thank you very much. Thank you.
>> Thank you very much. Thank you. >> And I and I I really appreciate that.
>> And I and I I really appreciate that. And there is a saying that we have all
And there is a saying that we have all the time which is um the plan is
the time which is um the plan is nothing. Planning is everything.
nothing. Planning is everything. Well, I'm a Bamboki fan myself.
Well, I'm a Bamboki fan myself. >> Yeah. Yeah.
>> Yeah. Yeah. >> The plan becomes obsolete with first
>> The plan becomes obsolete with first contact with the enemy.
contact with the enemy. >> Yeah. But is it is the planning the
>> Yeah. But is it is the planning the process except when you're creating a
process except when you're creating a strategy um we we need to look at the
strategy um we we need to look at the strategy as if it is a is a maneuver. So
strategy as if it is a is a maneuver. So always we are looking at going well if
always we are looking at going well if we are to do this what would we what
we are to do this what would we what would we and it's all obviously just
would we and it's all obviously just perspective but we we look at go well if
perspective but we we look at go well if we do this what would we be the response
we do this what would we be the response for that how would we know they're going
for that how would we know they're going to respond and what would it look like
to respond and what would it look like um yeah how would we know and what would
um yeah how would we know and what would our our response to so you're already
our our response to so you're already thinking about the terms and maneuver
thinking about the terms and maneuver then what that does is it enables the um
then what that does is it enables the um the the the sort of conceptual framework
the the the sort of conceptual framework for for the people interacting with the
for for the people interacting with the external environment to adapt to those.
external environment to adapt to those. we see that it's not a surprise and then
we see that it's not a surprise and then this is also puts on the the incumbents
this is also puts on the the incumbents on the the the people in the
on the the the people in the organization like I know we talk about
organization like I know we talk about system three star but in reality that is
system three star but in reality that is does does the does the organization or
does does the does the organization or the leaders actually go down and get an
the leaders actually go down and get an unfiltered understanding of of what's
unfiltered understanding of of what's actually happening reality and I don't
actually happening reality and I don't think they do that enough so they become
think they do that enough so they become further and further disconnected um
further and further disconnected um which means come back to Floren's point
which means come back to Floren's point as silence that they they they lose grip
as silence that they they they lose grip of what actually is um capable in the
of what actually is um capable in the organization.
organization. >> Good evening. Uh what is your statement
>> Good evening. Uh what is your statement or question please?
or question please? >> You're rebuted.
>> Yeah, I was on the I was on the agometer during the presentation so I thought
during the presentation so I thought it'd be better to be muted. Um so Mike,
it'd be better to be muted. Um so Mike, thanks for the presentation. Really
thanks for the presentation. Really enjoyed it and thanks Martin for
enjoyed it and thanks Martin for hosting. I would love to riff on the
hosting. I would love to riff on the question you know how do you explain it
question you know how do you explain it to the leaders. I think the only thing a
to the leaders. I think the only thing a leader needs to know is themselves which
leader needs to know is themselves which is you know where the problem starts and
is you know where the problem starts and ends and oftentimes that leads into
ends and oftentimes that leads into palative care on organizations because
palative care on organizations because most leaders when you confront them with
most leaders when you confront them with their own insufficiencies they start to
their own insufficiencies they start to projecting that upon you. I don't know,
projecting that upon you. I don't know, Mike, if you've experienced that,
Mike, if you've experienced that, Martin, you probably haven't because
Martin, you probably haven't because you're writing amazing books and people
you're writing amazing books and people give you that that authority, but it's
give you that that authority, but it's really from my perspective super amusing
really from my perspective super amusing how people deny reality to riff on on
how people deny reality to riff on on Ben's point. And then what I usually do
Ben's point. And then what I usually do is I I will write out a six week
is I I will write out a six week prediction on if you're not doing this,
prediction on if you're not doing this, here's the things that will happen. And
here's the things that will happen. And the the longer you wait to engage um the
the the longer you wait to engage um the more painful the process will become.
more painful the process will become. Usually after week three they come back
Usually after week three they come back and it becomes really funny.
and it becomes really funny. >> Yeah, we we're always battling with with
>> Yeah, we we're always battling with with strategy cuz it is a is a um initially
strategy cuz it is a is a um initially the conception is conceptual activity
the conception is conceptual activity until it hits reality and then we have
until it hits reality and then we have that feedback loop. But we're all
that feedback loop. But we're all fighting with what we call perceptual
fighting with what we call perceptual complexity. Like we we we must we must
complexity. Like we we we must we must and this is why um we we must have that
and this is why um we we must have that space and this is why I always argue AI
space and this is why I always argue AI will not take over strategy because AI
will not take over strategy because AI will give you the answer. It will not
will give you the answer. It will not allow that space for the perceptual
allow that space for the perceptual complexity to unear um the cognitive
complexity to unear um the cognitive behavioral um um aspects that the
behavioral um um aspects that the development of strategy gives you. But
development of strategy gives you. But you must have that space to um surface
you must have that space to um surface um the tensions um and the disagreements
um the tensions um and the disagreements and the different perspectives.
and the different perspectives. Um otherwise where where strategy
Um otherwise where where strategy currently is is in this consensus driven
currently is is in this consensus driven madness where we we we we leave it to we
madness where we we we we leave it to we leave it down under the surface because
leave it down under the surface because we just want to have consensus around a
we just want to have consensus around a very pointless abstraction of a vision
very pointless abstraction of a vision statement. M
statement. M >> I would I would say that what I observe
>> I would I would say that what I observe is that these top managers they're all
is that these top managers they're all intelligent people and of course some
intelligent people and of course some have self-interests and things like that
have self-interests and things like that and egoisms but what they mostly lack
and egoisms but what they mostly lack they're helpless somehow they lack of
they're helpless somehow they lack of language and concept that's my
language and concept that's my observation
observation >> yes
>> yes >> they're excellent experts in their
>> they're excellent experts in their fields very good engineers or doctors or
fields very good engineers or doctors or whatever the organization is about but
whatever the organization is about but they lack of a language to talk about
they lack of a language to talk about strategy and they have all these
strategy and they have all these mismatch these misunderstandings that I
mismatch these misunderstandings that I I love Mike's statement so much for
I love Mike's statement so much for because it makes clear what is the
because it makes clear what is the difference what is a strategy and what
difference what is a strategy and what is it not and how do we have to design
is it not and how do we have to design it uh levels of recursion we have
it uh levels of recursion we have touched we have touched um the
touched we have touched um the difference of or the problem of fixed
difference of or the problem of fixed time horizons we have touched the the
time horizons we have touched the the detachment from execution and reality uh
detachment from execution and reality uh strategy as an output as you say Mike we
strategy as an output as you say Mike we have touched the level of recursivity
have touched the level of recursivity all these concept concepts uh that would
all these concept concepts uh that would enable them to talk about strategy and
enable them to talk about strategy and because if if you ask five managers do
because if if you ask five managers do you get five different answers what what
you get five different answers what what it is all about strategy right nowadays.
it is all about strategy right nowadays. >> Mhm.
>> Mhm. >> One one quick addition to that because I
>> One one quick addition to that because I think it's important we must distinguish
think it's important we must distinguish between complexity capabilities and
between complexity capabilities and intelligence. There is people that are
intelligence. There is people that are super intelligent but they're
super intelligent but they're one-dimensional and under
one-dimensional and under differentiated. This is the article I
differentiated. This is the article I just dropped into the comments and
just dropped into the comments and because people always feel like you're
because people always feel like you're attacking them um if that is the
attacking them um if that is the language. So Martin I think very
language. So Martin I think very pertinent point but it's the difference
pertinent point but it's the difference that makes the difference to quote Bates
that makes the difference to quote Bates >> um that people must understand. You can
>> um that people must understand. You can be super intelligent but beed
be super intelligent but beed one-dimensional and under differentiated
one-dimensional and under differentiated and in the case of complexity then
and in the case of complexity then you're amazingly screwed despite being
you're amazingly screwed despite being super intelligent and an absolute expert
super intelligent and an absolute expert in your very narrow field. That's how we
in your very narrow field. That's how we start closing the circle now Mike
start closing the circle now Mike because I started with the question what
because I started with the question what does organizational psychology have to
does organizational psychology have to do with the whole thing here but before
do with the whole thing here but before we do that maybe Danielle Hmel good
we do that maybe Danielle Hmel good evening what is your statement or
evening what is your statement or question
question >> um I'm reminded of something very
>> um I'm reminded of something very fundamental and uh Tim was just going in
fundamental and uh Tim was just going in that direction I think John Lee was also
that direction I think John Lee was also going in that direction and I think like
going in that direction and I think like what I'm reminded about also because
what I'm reminded about also because somebody dropped the term philosophy
somebody dropped the term philosophy that the VSSM is also about philosophy
that the VSSM is also about philosophy in the chat is that they the the leaders
in the chat is that they the the leaders they don't deny reality they they see
they don't deny reality they they see reality differently
reality differently >> and sometimes we have a disconnect
>> and sometimes we have a disconnect really on the level of world view um
really on the level of world view um because if you're a positivist who
because if you're a positivist who assumes like the world is like
assumes like the world is like observable and there is a like objective
observable and there is a like objective reality that you then can also
reality that you then can also communicate you will behave
communicate you will behave fundamentally ally different than a
fundamentally ally different than a constructivist or social constructionist
constructivist or social constructionist who will automatically come in with a
who will automatically come in with a completely different approach and um I
completely different approach and um I think we often forget that this is like
think we often forget that this is like the the foundation we're standing on and
the the foundation we're standing on and I think the disconnect is often already
I think the disconnect is often already at that level
at that level >> and uh that is that is kind of
>> and uh that is that is kind of mindboggling to me that we always come
mindboggling to me that we always come back to that. Yeah,
back to that. Yeah, >> this is the really crucial point around
>> this is the really crucial point around um cognitive diversity and I think this
um cognitive diversity and I think this is an element that gets overlooked in in
is an element that gets overlooked in in the the strategic teams and about p
the the strategic teams and about p perception
perception and what boys a lot of boys work is
and what boys a lot of boys work is about is about how do we get that shared
about is about how do we get that shared orientation and that's not do we think
orientation and that's not do we think the same that is just that have have we
the same that is just that have have we had that debate and that challenge to to
had that debate and that challenge to to somehow and it's never going to be
somehow and it's never going to be perfect But we we we've we've probably
perfect But we we we've we've probably removed more of that darkness um that's
removed more of that darkness um that's out there so that you know not only do
out there so that you know not only do we have a shared orientation of the
we have a shared orientation of the situation but our orientation is close
situation but our orientation is close to reality as possible so that when our
to reality as possible so that when our entities act and how that responds to
entities act and how that responds to the external environment will will be
the external environment will will be less of a surprise um than if it were.
less of a surprise um than if it were. And all we're trying to do is he called
And all we're trying to do is he called it three entry principles in sense of
it three entry principles in sense of how do we minimize uh surprises.
>> Thank you John. Once more Ben please. >> Yep. I do have one question actually uh
>> Yep. I do have one question actually uh Mike with respect to your background
Mike with respect to your background with organizational psychology because
with organizational psychology because uh when it comes to psychology in
uh when it comes to psychology in organizations you know before I
organizations you know before I discovered Stafford beard systems
discovered Stafford beard systems thinking and cybernetics just just this
thinking and cybernetics just just this year uh most of my best outcomes I
year uh most of my best outcomes I achieved was from a close study of some
achieved was from a close study of some western philosophy and and psychology
western philosophy and and psychology especially the family systems therapist
especially the family systems therapist right basavic Virginia Satir and I think
right basavic Virginia Satir and I think there's a lot gold to be mined there. I
there's a lot gold to be mined there. I just I haven't noticed a lot of uh I've
just I haven't noticed a lot of uh I've noticed a lot of affinities of course. I
noticed a lot of affinities of course. I mean because a lot of it goes back to
mean because a lot of it goes back to Bateson uh almost all of it, you know,
Bateson uh almost all of it, you know, with the paradoxical interventions and a
with the paradoxical interventions and a lot of what Stacy's doing, you know, a
lot of what Stacy's doing, you know, a lot of that goes back to uh to Bateson
lot of that goes back to uh to Bateson and then and then all the family systems
and then and then all the family systems therapy that that came from the MRI and
therapy that that came from the MRI and and some in Italy. I'm curious to know
and some in Italy. I'm curious to know uh from a systems since you're a systems
uh from a systems since you're a systems thinker also have you seen opportunities
thinker also have you seen opportunities to implement more and to find more of a
to implement more and to find more of a of a you know of a communion and and a
of a you know of a communion and and a marriage with systems thinking and all a
marriage with systems thinking and all a lot of the really good systems therapies
lot of the really good systems therapies out there. That was kind of a rambly
out there. That was kind of a rambly question. I'm I'm sorry. I hope that
question. I'm I'm sorry. I hope that makes sense. Um yeah in a sense of well
makes sense. Um yeah in a sense of well my my problem with a lot of the
my my problem with a lot of the organizational psychology and also the
organizational psychology and also the coaching element is that is that they
coaching element is that is that they they um they they remove people from the
they um they they remove people from the organization. So when they try to do the
organization. So when they try to do the intervention is regardless of the
intervention is regardless of the structures that are created the
structures that are created the organization and they try to fix them
organization and they try to fix them and then put them back in the
and then put them back in the organization
organization um which which isn't fixed and it drives
um which which isn't fixed and it drives it merges the behavior that they're
it merges the behavior that they're trying to sort. So they sort of don't
trying to sort. So they sort of don't really work um so the the two can work
really work um so the the two can work really close together and I suppose that
really close together and I suppose that family therapy was the sort of insight
family therapy was the sort of insight first time really of of psychology
first time really of of psychology becoming more of a systems focus. Um so
becoming more of a systems focus. Um so actually the two are really useful but
actually the two are really useful but they have to be done um
they have to be done um closely coupled together otherwise you
closely coupled together otherwise you won't get anywhere and and this is part
won't get anywhere and and this is part of the problem with a lot of the um
of the problem with a lot of the um modern leadership thinking is that
modern leadership thinking is that they've somehow convinced leaders that
they've somehow convinced leaders that they are Harry Potter you know they they
they are Harry Potter you know they they can say a few magic words and wave a
can say a few magic words and wave a wand and it will change something
wand and it will change something without realizing that that is truly
without realizing that that is truly false and you can you can paint the
false and you can you can paint the walls of all the vision statements and
walls of all the vision statements and value statements all you want. It will
value statements all you want. It will fundamentally not change what the
fundamentally not change what the organization does and actually it
organization does and actually it aspiration needs to be matched again
aspiration needs to be matched again with the structure um of the
with the structure um of the organization. But isn't a problem that
organization. But isn't a problem that that was always true in the past for
that was always true in the past for those leaders because they did speak the
those leaders because they did speak the word and magic happen. So their brain is
word and magic happen. So their brain is totally used and construed to like
totally used and construed to like saying the word and making the magic
saying the word and making the magic happen and that is no longer working.
happen and that is no longer working. >> No. And this is where um marketing is
>> No. And this is where um marketing is has jumped in the void. So this void
has jumped in the void. So this void between you know how we used to conceive
between you know how we used to conceive strategy from where it came from the
strategy from where it came from the military terms to organizations now
military terms to organizations now because we are inherently storytelling
because we are inherently storytelling um animals. Marketing has then fallen
um animals. Marketing has then fallen this void now. You have to go very far
this void now. You have to go very far if you or look very far in um when
if you or look very far in um when people talk about strategy they'll talk
people talk about strategy they'll talk about storytelling and and all this
about storytelling and and all this stuff. And I suppose there is a place
stuff. And I suppose there is a place for it but that is not the strategy. And
for it but that is not the strategy. And I think that's where it gets confused
I think that's where it gets confused with that is that they are enablers. I
with that is that they are enablers. I you can argue if they're valid enablers
you can argue if they're valid enablers or not, but that is not the strategy.
or not, but that is not the strategy. >> You're right. And last thing I'll say
>> You're right. And last thing I'll say until I see a hand pop up or Martin cuts
until I see a hand pop up or Martin cuts me off is that with uh in my world, the
me off is that with uh in my world, the marketing and branding aspect is all the
marketing and branding aspect is all the what I would call the method merchants.
what I would call the method merchants. They have they've taken over. You have
They have they've taken over. You have you have more people teaching lean
you have more people teaching lean construction than actual practitioners.
construction than actual practitioners. And I was a devote and a total disciple
And I was a devote and a total disciple and I have a PMP and I did all that. But
and I have a PMP and I did all that. But what I found was that after 20 30 years
what I found was that after 20 30 years of it's become a Witkinian language
of it's become a Witkinian language game, right? People just say these
game, right? People just say these things and they don't even say them
things and they don't even say them right anymore, you know, plan, do,
right anymore, you know, plan, do, check, adjust. It's like it's not
check, adjust. It's like it's not adjust, it's act, you know, but it
adjust, it's act, you know, but it doesn't even matter anymore. It become
doesn't even matter anymore. It become these mantras and it's uh and so it gets
these mantras and it's uh and so it gets assimilated and like in a Hegelian
assimilated and like in a Hegelian dialectic way. It it becomes a thing.
dialectic way. It it becomes a thing. And so it's even more damaging and more
And so it's even more damaging and more painful. And it's like a, you know,
painful. And it's like a, you know, Christianity a couple hundred years ago,
Christianity a couple hundred years ago, but it's like we're not doing anything
but it's like we're not doing anything like we said we were going to. We're
like we said we were going to. We're burning people, you know. So it's like,
burning people, you know. So it's like, uh, no, this is doing more harm, but
uh, no, this is doing more harm, but it's it's Yeah. So I think you see it's
it's it's Yeah. So I think you see it's the simulation similacra
the simulation similacra >> and and I think there's there's some
>> and and I think there's there's some worldviews that have got to be
worldviews that have got to be challenged moving forward about
challenged moving forward about especially about organizations
especially about organizations uh and old myths and one of those myths
uh and old myths and one of those myths is we we need fat in the system.
is we we need fat in the system. >> We we we can't afford to to have we need
>> We we we can't afford to to have we need to have fat in the system. If you look
to have fat in the system. If you look at the the military and and there I know
at the the military and and there I know they they have a third of their
they they have a third of their organization which is always in reserve
organization which is always in reserve and the reason why they do that cuz
and the reason why they do that cuz that's matched with the volatility and
that's matched with the volatility and the rate of change in the ex in the
the rate of change in the ex in the external environment. So I'm not saying
external environment. So I'm not saying that any organization needs to have a
that any organization needs to have a third of the the the their the entity in
third of the the the their the entity in reserve but they need to have um
reserve but they need to have um requisite agility or fat in the system
requisite agility or fat in the system matched to the rate of change that's
matched to the rate of change that's happening in the external environment.
happening in the external environment. >> More topics are more top topics are
>> More topics are more top topics are opening up and we could have spent
opening up and we could have spent another evening on discussing the
another evening on discussing the redundative potential command for
redundative potential command for example
example building of fat things like that.
building of fat things like that. Um it's very relevant the whole topic
Um it's very relevant the whole topic once more companies in Europe that's
once more companies in Europe that's what I observe are typically too heavy
what I observe are typically too heavy and too slow
and too slow >> and has to do with the steering system.
>> and has to do with the steering system. VSSM can help a lot with that and it's
VSSM can help a lot with that and it's definitely also about how they do
definitely also about how they do strategy and planning. One topic just
strategy and planning. One topic just that we haven't discussed or touched yet
that we haven't discussed or touched yet tonight and that's the last topic I just
tonight and that's the last topic I just would briefly like to to to to touch is
would briefly like to to to to touch is the damping of variety by policy of
the damping of variety by policy of course first identity then by strategy
course first identity then by strategy but
but um
um also dampening the way we do strategy
also dampening the way we do strategy the variety the complexity of the whole
the variety the complexity of the whole thing by the concept of essential
thing by the concept of essential variables. We haven't been talking about
variables. We haven't been talking about the concept of essential variables yet,
the concept of essential variables yet, which is a very important concept I
which is a very important concept I think also of how you deal with strategy
think also of how you deal with strategy because you could talk about thousands
because you could talk about thousands of things. If you talk about strategy
of things. If you talk about strategy um uh I think it's very important to
um uh I think it's very important to apply it. There's different ways to do
apply it. There's different ways to do it, but what's what what's your what's
it, but what's what what's your what's your opinion about that? How are you
your opinion about that? How are you using the concept somehow?
using the concept somehow? Um oh two sex I'm not too sure just say
Um oh two sex I'm not too sure just say the question again I I didn't quite get
the question again I I didn't quite get what the the question
what the the question >> yeah the question about about the
>> yeah the question about about the concept of essential variable saying
concept of essential variable saying that you need to focus on what matters
that you need to focus on what matters more focus is the actually the topic
more focus is the actually the topic damping var saying we need to focus on
damping var saying we need to focus on >> I can tell you how I do it I focus on
>> I can tell you how I do it I focus on six
six essential variables if I do strategy and
essential variables if I do strategy and planning with my customers and that's
planning with my customers and that's typically ally um market position,
typically ally um market position, innovation rate, productivity,
innovation rate, productivity, attractiveness for good people,
attractiveness for good people, liquidity, cash flow and profitability,
liquidity, cash flow and profitability, six factors,
six factors, >> threat markets, describe them.
>> threat markets, describe them. >> Um are you using something like that? I
>> Um are you using something like that? I use it for developing strategies as
use it for developing strategies as well, for example.
well, for example. >> Um
>> Um not quite like that. I think we we do in
not quite like that. I think we we do in in similar ways, but probably just we
in similar ways, but probably just we get to it in a in in a slightly
get to it in a in in a slightly different way. But the um
different way. But the um it all comes from the feeling about what
it all comes from the feeling about what what is it that we're actually wanting
what is it that we're actually wanting to do in the um in the strategy then
to do in the um in the strategy then that then dictates around what we call
that then dictates around what we call capability shifts. So what's the shift?
capability shifts. So what's the shift? So if we want to do if we want to do
So if we want to do if we want to do that um we have to do something to
that um we have to do something to enable that to to happen. So we have the
enable that to to happen. So we have the the capability shifts.
the capability shifts. >> Yeah. Those are attributed to parts of
>> Yeah. Those are attributed to parts of the organization which then it's about
the organization which then it's about what what what area do they need to to
what what what area do they need to to to develop change redirect to to get to
to develop change redirect to to get to that and that's where we then
that and that's where we then >> um bring the focus so that if it's not
>> um bring the focus so that if it's not if it's not aligned to that and I
if it's not aligned to that and I suppose it's the the challenge between
suppose it's the the challenge between um status quo and change really it's
um status quo and change really it's about what is it they need to focus on
about what is it they need to focus on today and and make sure that we hit that
today and and make sure that we hit that value that we're going through and
value that we're going through and that's the the normal return the normal
that's the the normal return the normal business stuff we're going on but then
business stuff we're going on but then it's all about what's the focus to um
it's all about what's the focus to um adapt over time so I think it's just we
adapt over time so I think it's just we do get to focus but the focus is done in
do get to focus but the focus is done in the planning part to say that this is
the planning part to say that this is this is where we need to um exert our
this is where we need to um exert our limited resources as Clausfitit said no
limited resources as Clausfitit said no organization regardless the size has
organization regardless the size has unlimited resources so it's focusing
unlimited resources so it's focusing those resources to what matters
those resources to what matters >> I See, I see. So, thank you very much,
>> I See, I see. So, thank you very much, Mike. Absolutely agree with what you're
Mike. Absolutely agree with what you're saying. It was most interesting. I just
saying. It was most interesting. I just would like to
would like to put that
put that slide here on the screen. No, not that
slide here on the screen. No, not that was not the one. That one here, upcoming
was not the one. That one here, upcoming practitioner webinars.
practitioner webinars. Um, if you have ideas about what you
Um, if you have ideas about what you want to hear, uh, who you want to disc
want to hear, uh, who you want to disc what you want to discuss in 26, please
what you want to discuss in 26, please let us know. Write into the chat,
let us know. Write into the chat, please, or send us an email. And, uh,
please, or send us an email. And, uh, with saying that, I would like to thank
with saying that, I would like to thank you once more, Mike. It was very
you once more, Mike. It was very important. You're providing a very
important. You're providing a very important puzzle to the whole piece of
important puzzle to the whole piece of functioning in our world. I think a new
functioning in our world. I think a new way or an important way to look at
way or an important way to look at strategy. You nicely showed how the
strategy. You nicely showed how the viable system model helps with doing
viable system model helps with doing that. We have been touching all these
that. We have been touching all these concepts
concepts uh and um and yes was very nice and uh
uh and um and yes was very nice and uh uh interesting evening. Thank you very
uh interesting evening. Thank you very much on behalf of all the audience.
much on behalf of all the audience. Thank you very much everybody for
Thank you very much everybody for spending some time with us and uh seeing
spending some time with us and uh seeing you soon again.
you soon again. Thank you everybody for organizing
Thank you everybody for organizing healthy. Byebye. Byebye. Thank you very
healthy. Byebye. Byebye. Thank you very much.
much. >> Killed it. You killed it. It's great.
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