# Links # RE Comments on SDS Strategy Development Subject: RE: Comments on SDS Strategy Development From: Kim Warren To: James B. Berger; Jim Lyneis; Jay W. Forrester Date Sent: 7/30/2008 4:08:47 AM Thanks for this useful contribution James and sorry for the slow response - it's been a bit frantic recently. You are dead right that we will need an effective organisation for achieving the strategy that emerges from the process. System dynamics itself is fit-for-purpose to clarify objectives and the requirements for achieving them, and will get us to the point where we know what needs to be done, by how much, at what time [there will be options here, of course, not just a single answer]. Then we will be turning to the organisational issue of what people will be needed to do all this and how they will need to be organised. .. at which point your additional contribution will be especially valuable.  Do come back to me on this when we have enough to go public on regarding the results of the early part of the work - we intend to consult widely on this. best wishes - Kim  Kim Warren .. see - the new strategy dynamics forum and learning materials - training and expert advice on strategy dynamics for your organization at SDS - order the new book, and register as an instructor at Wiley From: James B. Berger [[mailto:[email protected]](mailto:mailto:[email protected])] Sent: 23 July 2008 19:57 To: Jim Lyneis; Kim Warren; Jay W. Forrester Subject: Comments on SDS Strategy Development Gentlemen, I have followed the conversation regarding the Society Strategy Development with great interest. As a former member I felt I should address some comments I have about that process to influential members of the organization rather than sending them in as a post to the mailing list. Jim, I also did not want our previous conversations to die from neglect. I believe that the use of System Dynamics should spread widely throughout organizations across the world. SD should play a significant role in education from early grades on through college and graduate school. Every high school graduate should have a familiarity, if not a working knowledge, of the discipline. College and advanced degrees in science, economics, business, and more should require an understanding of SD. Every organizational leader should know how to sketch and interpret stock and flow diagrams. From what I have seen in the mailing list conversation the System Dynamics Society will at best not help the proliferation of SD use and at worst may hinder it because of its close association with System Dynamics itself. It seems that these conversations focus too much on the uses of System Dynamics and not enough on the structure of the organization (SDS). Your strategic planning process should focus on building an effective, efficient and adaptable organization that has the capability helping members realize their dreams about the use of SD. Rather than an unstructured conversation, you need a structure within which to conduct conversations that lead to an organizational design and a long-term strategy. As the last part of this message I have provided an outline of a process for defining an organizational structure and a strategic plan. If you worked through this process, you would come out the other end with a clear vision of the organization you wish to create and an explicit strategy for how to realize that vision. You could complete this process with all your members participating by using something like the wiki technology together with a large group intervention process like “Open Space Technology.” Although I have kept my comments brief and the outline below does not contain much detail, I believe they convey what I suggest. Thanks, Jim Berger This outline contains images and formatting. If they get stripped out by your mail program, let me know and I can send you the outline as a PDF attachment. Organizational Structure and Planning             Organization (Architecture)Any organization, from two people meeting for a conversation to large organizations like General Motors, can describe its structure in terms of this organizational architecture. With most organizations this structure remains implicit and changing arbitrarily. Making the structure explicit and changeable by design can make the organization far more effective, efficient and adaptable.             Guiding IdeasGuiding ideas provide the basis for the shared mental model by which the organization operates. I have divided these seven elements into context, which provides a rather permanent foundation for that mental model, and content, which defines why the organization exists and what it plans to do to fulfill that purpose. In my experience most organizations jump right into defining mission before the more important and deeper thought occurs.             Context            Principles            Theories            Values            Content            Purpose            Vision            Mission            Goals            Processes & MethodsProcesses & Methods define what the organization does and how it goes about doing that. The five processes that I have included play an important role in strategic planning so I will describe them briefly.             Product DevelopmentWhat product (service) does the organization offer to satisfy customer (all organizations have customers) needs? What does the organization do to keep its product current with those needs?             Operations / AdministrationHow does the organization produce its products and operate its business?             Management / PersonnelWhat does the organization do to assure that its management and personnel fit the needs of the organization?             Marketing & DistributionHow does the organization inform prospective customers about its products and deliver them to customers?             FinanceWhat financial resources does the organization require for its operation and how does it manage those resources?             CommunityCommunity defines all the people and organizations that belong to the organizations system. E.g.:             Customers            Employees            Support People            Suppliers            Infrastructure & ToolsInfrastructure & Tools define the stuff required by the organization to engage in its processes and methods and fulfill its purpose. E.g.:             Plant & Equipment            Information            Assumptions              Organization (Strategic) PlanSince the organizational architecture describes the organization at a specific time, the organization should use that architecture model to develop a strategic plan. The organization should define, using the architecture design, what they want the organization to look like at some time in the future (a vision). It should also describe its current reality, using that same architectural design. The gap between the current architecture (current reality) and the future architecture (vision) creates what many refer to as “structural tension.” Once the organization has a clear picture of what kind of organization they want to create in the future and realities of the current organization they need to develop a strategy for closing that gap. I will comment briefly on strategy below.             Vision (Future)            Guiding Ideas            Processes & Methods            Community            Infrastructure & Tools            Structural TensionThe gap between current reality and the future vision.             Current Reality            Guiding Ideas            Processes & Methods            Community            Infrastructure & Tools            StrategyThe organization should base its strategy of the same five processes included in Processes & Methods element of the architecture design. To the descriptions of processes included in the architecture the strategy adds timelines, responsibilities and other components that define the dynamic nature of a strategy.             Product Development            Operations / Administration            Management / Personnel            Marketing & Distribution            Finance              ConclusionWith a well designed organizational architecture all the components of the organization become fully integrated and aligned. With a well conceived strategy the organization moves smoothly from the present into a future of its own design. Building the plan based on an image of the organization in the future keeps attention focused on the endogenous parts of the system (i.e. those things the organization actually can control.) When the organization attends to its own processes (developing better products, operating more efficiently, employing more competent and aligned people, etc.) it will have a greater influence on the exogenous parts of the environment (i.e. those things which it cannot control, like volume of customer purchases and prices).