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Following the familiar into the niche or better doing something else

In the meantime the speed of change is so high that several cycles take place within a lifetime – different political systems; or remember shellac, vinyl, CD, Blu-Ray, mp3; or the fire place, gas, oil, geothermal, solar heating. In the working world, workers have made a living for a long time within the industry and the resulting mass production. And suddenly machines take over the simple tasks. Or think about the cabmen, who eventually had to accept that they no longer needed to feed their vehicle, but to refuel. Although this did not mean that coachmen have completely disappeared, but today they only fill a niche in tourism.

Everyone is talking about disruption. That sounds fancier and not as threatening as destruction. But the meant change is anything but sudden, volatile or unexpected – albeit disturbing and ripping. Even the small improvements that take place over the years lead to a profound change over time. What options are there for dealing with change?

  • Head-in-the-sand policy
    The most passive reaction is to stick your head in the sand and to wait the change passes unnoticed. You are loosing valuable time that you could use to re-position yourself. This approach is believed to be the legacy of the early days of the biosphere, when fear threw somebody into paralysis and one could hope to survive despite the thread.
    Nowadays, this is the worst possible reaction to respond to menacing innovations. The changes in the world of work do not pass by, but they roll over you. In any case, one of the following approaches is better.
  • Resign to your fate
    Also in this case it is a matter of passive action. It’s like fighting against the current in a rowboat – as soon as you stop rowing, you’re drifting off. You lose all control of where to end up. The accompanying shrugging of the shoulders and blaming are a typical reaction when somebody is thrown off track. Only those who continue to row have a chance to dominate their destiny.
    Such a fate is bad. However, it’s just one of the many risks you face in everyday life – accidents, illnesses, losses of all kinds. It is smarter to use the opportunities offered to find your new track. In any case, one of the following approaches is better.
  • Fighting
    If you are confronted with drastic change, it is not immediately clear, whether it is a conclusive disruption. Nevertheless, most people start resisting – some do not understand, what is happening; others do not know, how to react to it; some do not accept the new on principle or for other reasons; and sometimes they are not even allowed to follow.
    The battle for the familiar is the fastest, active reflex. Barriers emerge, which have nothing to do with the actual innovation – antipathies; repressed problem areas; personal sensitivities. In any case, the following approach is better
  • Toward new shores
    Almost all changes also affect the decision makers who initiated the transformation. The frontline is not between the decision makers and the affected people, but between yesterday and tomorrow. Much more effective is constructively dealing with the new – What is actually changing? What is being replaced? What do you lose? What do you win? What can you contribute? What does that mean for you?
    The transition rarely takes place abruptly – with a reason why the word disruptive unnecessarily frightens. All changes need their time. The phone took over sixty years to be installed in 80% of the households in the US. Even if the computer took only about ten years, these are still ten years, in which one could adjust to the new possibilities of networking – using existing skills in a new way; realign; learn the new. In any case, the past shows that development is unstoppable. Even if it sounds banal, the only thing that is constant is the change. There is nothing left for us to do but to continually adapt.

Bottom line: The cabmen had suddenly no horses and had to deal with a new technology. At the same time, they were able to reuse their core competencies – local knowledge; dealing with customers; waiting patiently for a load. When the tsunami of the turnaround reaches you, the worst reaction is putting the head in the sand and the second worst to resign to your fate. The fight is an active, even so destructive action. It is best to face change and seek your place on the new wave – even if you follow the familiar into the niche.


The VSM provides, what everybody needs

For a very long time, the horizontal and vertical division of labor was the basis for the breakdown of economic endeavors. The lack of availability and the slow flow of information required many handover points to propagate the intentions of the management and to create transparency of the business. At the same time, the tasks, authorities and responsibilities were designed in such a way that the actual value creators could fulfill their tasks without understanding the big picture. With the introduction of computers and their interconnectedness nowadays, all parties involved can reach the relevant information wherever and whenever, without the need for additional coordination expenditure. Since the companies reached the end of the one-way street of reducing costs, they are looking for new approaches, e.g. Holocracy, Platforms, Agility, Connected Company, etc. Although, there is already an approach available for a long time that fits perfectly with today’s requirements – the VSM.

The Viable System Model (VSM) describes the setup of a viable distribution of tasks. Stafford Beer introduced this model as early as 1959 in his book Cybernetics and Management. The VSM is part of a new view that has been developed for decades under the term System Thinking in the shadow of classical organizational theory. In this article we start looking at the model in general. Henceforth there will be more blog posts on this.

  • System 1 – Value creation (S1)
    In this area subsystems generate the deliverables. The products are manufactured respectively the services are executed. There is a direct contact with the environment, for example with the customers, the suppliers, and partners. This is where the value-adding activities take place. Each of these units is by itself a VSM with the corresponding components. In the new approaches these would be the sub-circles, the producers, the agile teams or the pods.
  • System 2 – Harmonization (S2)
    The value creation takes place in a small „company” (S1a) that behaves autonomously and self-organized. So that the individual subsystems interact, it is necessary to agree on the scope, the functionality and the interfaces. The vague exchange of information of the new approaches is made more specific in the VSM.
  • System 3 – Coordination (S3)
    Even though the everyday interaction in the S2 is harmonized, there is still a need in the here and now to focus on the big picture. For this purpose, the means to be used, the responsibilities and decisions are here made and disseminated in the operational units. Besides S3, an independent unit (S3*) is available in order to collect information that reflects the current state of the value creation as unspoilt as possible. The new approaches coordinate with, for example, backlog refinements and daily scrums, interaction platforms and governance.
  • System 4 – Alignment (S4)
    The company is constantly on the move in a direction that should be determined. This adjustment is influenced by the opportunities that arise in the environment. The direction of the company is determined by the leadership based on the new technical solutions that will be incorporated into future deliverables and on market opportunities that emerge. The insights will then be digested into a strategy and the associated planning that have an impact on all areas, including the development of employees and executives. In the new approaches, the alignment is left to the acting people.
  • System 5 – Final instance (S5)
    The areas of tension between the present (S3) and the future (S4) as well as between the company and the environment can not be resolved in Systems 1- 4. The last authority for such dilemmas makes the decisions that prevent the company from being damaged by its different internal interests. In contrast, the new approaches are based on a natural resolution of disputes through transparency and open exchange of positions.

Bottom line: Companies can not avoid putting themselves in a position that serves their purpose. The division of labor that eventually has a henchman performing simple activities dissolves. These same processes can nowadays be performed by machines and robots. The cascade for the distribution of information is also no longer needed due to the pervasive availability. As a result of the increasing digitization, there is a need to re-position the own company. The VSM provides, what everybody needs, since it allows realizing the bundling of tasks, authority and responsibility in one hand at the point of action as well as the agilization of lumbering companies.