While organizational transformation is primarily driven by strategy, an explicit organizational systems model increases the odds of a successful design or redesign. An organizational systems model provides an explicit structure to assist in the alignment of the organization’s stakeholders, strategy, systems, and scorecard. An enterprise process model is, as one CEO put it, “a logical assembly of processes that you need to do to run your business.”While the categorization of organization systems varies slightly among the many performance/business excellence models such as the Malcolm Baldrige National Quality Award in the United States, the European Foundation for Quality Management, and a variety of country and company excellence award programs, they all have some version of the seven systems groups presented here. Whether you begin with an established excellence framework or develop your own, a model provides the top-level systems understanding that is required for designing the individual systems so that they contribute to the overall system success. In our framework, organization systems are grouped into three core organizational competencies of value creation, enablers, and guidance.
Value Creation Systems
Value Creation Systems include the entire value chain from understanding customer requirements and designing and developing products to the supplier management, operations, and delivery and customer relationships systems. Depending on the nature of the products, these systems are often combinations of physical, knowledge, and creative processes often with the need for bespoke (custom) execution.
- Customer and Market Segmentation and Requirements
- Customer Marketing and Relationship Management
- Product and Service Strategies and Development
- Production Systems (all types of products and services)
- Support Systems
- Delivery, Service, and Customer Support
3. Suppliers and Partners
- Supplier and Partner Requirements
- Source Selection and Work Placement Strategies
- Supplier and Partner Management
Enabler Systems support the continuous improvement of all systems including execution excellence systems as well as the strategic leadership systems. Organizational learning and innovation systems include people support processes to help humans learn, develop, and innovate. Also, these systems provide measures and review processes that produce new insights and knowledge.
- Attract, Acquire, and Assign
- Engage, Manage, and Improve
- Develop and Support
5. Knowledge and Information
- Comprehensive Scorecard
- Data Collection and Analysis
- Knowledge Management
Guidance Systems provide guidance and resource to the execution and support systems as well as the organization learning systems. Strategic leadership includes systems such as leadership; strategy development and deployment; governance; ethical, legal, and regulatory; and social and environmental sustainability. The nature of most of these systems is knowledge and creative systems that facilitate innovative solutions and information flows.
6. Leadership and Strategy
The starting point for a strategic leadership system is the nine leadership system components found in the Leadership & Design Blueprint (components 2 through 10) which are addressed in Chapters 2 through 10 in the [Re]Create book. How these basic “building blocks” are used to inform the design of a custom leadership system for your organization is up to you and your leadership team.
- Strategy Development and Deployment
- Organization Performance Review
- Legal, Ethical, & Regulatory
- Sustainability (economic, social, and environmental)
- Board of Directors
Ideally, these systems are aligned and integrated to create a high performing organization that creates sustainable value for multiple stakeholders.
While these are typical major systems in an organization, this list is not exhaustive. There are many more systems and processes embedded in these systems throughout the organization. How you label and classify your systems will depend on the particular model that you are using to assist in your improvement efforts. The good news is the design process and framework are applicable to all your systems regardless of you the classification scheme you choose or create.
When embarking on an organization redesign journey, it is often best to begin with the top-level systems and let those become the guide for the sub-systems. The first place to begin is usually with the Leadership System which is a “system of systems” and connects several of the other top-level systems. Ideally, these systems are aligned and integrated to create a high-performing organization that creates sustainable value for multiple stakeholders.
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