To be economically sustainable, a company must be designed for speed of flow. When we build an organization taking into consideration its constraint, we have a focus point or leverage point that allows us to do so much more with all the resources available towards a common goal. Without this advantage, any organization inevitably wastes time and energy it could be using to generate throughput.
Step Nine of the Decalogue Method is ‘Bring the Constraint inside the organization and fix it there’. In other words, once we have made sure that we are able to sell the capacity we have (see: Sell More of What Your Company Does with the Resources You Already Have – A Systemic Approach Part 16), we want to make sure that we are managing an internal constraint as this radically simplifies and focuses our efforts.
Managing a company as a system means designing and managing all the interdependencies so they are able to reliably produce what we are selling. HR plays a very important role in this.
The role of HR in a systemic organization
First and foremost, it is important to understand that HR is not a department. There are no departments or divisions in a systemic organization. There are interdependencies that happen through processes. The people who interact through these processes do so because they have the competencies that are required.
All of these interdependencies, whether they are through written or spoken communication, happen through language. The role of HR, then, is to manage interdependencies among people who work on processes that are structured and commonly understood. These interactions are never purely rational. People’s emotions are involved and HR has a special role in this regard. HR engenders a process-based way of managing the organization concerning not strictly rational aspects of people’s interactions. These interactions occur through language and they manifest themselves essentially in the form of:
- Conflicts and assumptions
- Negative implications
- Knowledge transfer/giving clear instructions
This is good news because the Theory of Constraints provides powerful and reliable Thinking Processes to guide and manage interactions that can harness people’s emotions in a positive direction towards the common goal.
HR and Business
HR, like every other part of the organization, is there to contribute to Throughput generation. To achieve this, HR has to impact the way people operate within the system. HR has an important role in mapping out the competencies the organization needs to reach its goal in a continuously improving way. HR contributes to this specifically through the ongoing upgrade and intake of necessary competencies as the company grows.
When HR participates in meetings, they can very fruitfully summarize what goes on, and keep notes to identify interactions that can be framed as conflicts, assumptions, negative implications and action items that require planning and execution, using Prerequisite Trees and Transition Trees. They can also facilitate the interactions by keeping them on track and focused when conversations drift off the agreed subject matter. The focus is always throughput generation for the company as that is how everyone involved benefits throughout the value network.
By continuously making use of the Thinking Processes, HR contributes directly to the business by ensuring speed of flow in people’s synchronized interactions and therefore speed of throughput generation. Everybody wins.
HR and psychology
In a systemic organization, HR’s focus is not individual performance coaching but continuously enhancing interactions within the system to accelerate flow. (Performance reviews are not appropriate in a systemic organization as it is the system, not the individual, that creates the parameters and dynamics for what can be achieved.) If individuals are having specific problems psychologically or cognitively then of course outside support can be engaged. What HR does act upon are the interdependencies and interactions among people. Without smooth interactions among people the company cannot achieve its goal of throughput generation. By using the Thinking Processes, HR can help people adopt an effective mental stance for working systemically and this, in turn, increases the collective intelligence within the company. In this sense, the concern is not psychology but rather philosophy of the mind – how we think and how we can think better– and epistemology – how we know what we know and the role of mental models and assumptions in the way we work towards our common goal.
In a systemic organization, there are no artificial barriers or silos and the emphasis is on speed of flow. However, people can still get stuck in trying to carry out their tasks. This interrupts the flow of activities and generally happens because in the moment in which they should carry out a task:
- They are in a conflict with someone else or with themselves
- They see a negative implication that will result from the action they must take
- They see too many obstacles
- They lack clear instructions
HR can effectively help people become unstuck operationally using the Thinking Processes:
- They are in a conflict with someone else or with themselves – conflict cloud
- They see a negative implication that will result from the action they must take – Negative Branch Reservation
- They see too many obstacles – Prerequisite Tree
- They lack clear instructions – Transition Tree
A word about motivation
As Dr. W. Edwards Deming has said, “…if management stopped demotivating their employees then they wouldn’t have to worry so much about motivating them.”
In a systemic organization, the emphasis is on designing correct interdependencies. When people are asked to do things that make sense and they are not “organized” with artificial barriers and silos, then they can exercise their competencies towards a common goal with clarity on what they must do and why. Conversely, when work is organized in a way that is chaotic, hierarchical and nonsensical just because that’s the way it’s always been done, people will inevitably be frustrated and demotivated.
HR plays a key role in ensuring that the flow of people’s interactions are smooth and that any time someone gets stuck in trying to carry out the tasks that are within their responsibility, they have a way to overcome the obstacles. This may be simply a lack of clear instructions, a misalignment of authority and responsibility, a conflict or dilemma, a perceived negative implication in taking an action or a process that needs to be revisited and improved. It is an ongoing effort to update and improve interactions, especially as new people are introduced into the organization.
A little light dispels a lot of darkness
We are now in the festive season and all of us at Intelligent Management would like to wish all of you who read this blog very happy holidays and a 2023 filled with light, warmth, peace and sustainably prosperous business!
PREVIOUS POSTS IN OUR SERIES ABOUT A SYSTEMIC APPROACH TO ORG DESIGN, MANAGEMENT AND OPERATIONS:
Radically Improving Organizational Performance – A Systemic Approach to Management Part 1
Interdependencies and Establishing the Goal of Your Organization A Systemic Approach to Management Part 2
How to Make the Best Decisions for Your Company and Measure What Matters – A Systemic Approach to Management Part 3
How to Drastically Improve Company Results through Healthy Interactions – A Systemic Approach to Management Part 4
Leadership for Complex Times – A Systemic Approach to Management Part 5
Create Stability and Predictability in Your Organization by understanding Variation – A Systemic Approach Part 6
Working with Variation to Support Good Decision Making – A Systemic Approach Part 7
Why Your Organization’s Constraints Are the Key to Success – A Systemic Approach Part 8
Improving Flow Company Wide – A Systemic Approach Part 9
Controlling the Whole Organization through the Constraint – A Systemic Approach Part 10
Leading and Managing Change Effectively: It’s a Process that Includes You – A Systemic Approach Part 11
End Silos and Dissatisfaction: Learn to Operate as a Network of Projects Organization – A Systemic Approach Part 12
Company Functions Are Limiting Your Organization’s Performance – A Systemic Approach Part 13
Are Companies with a Hierarchical/Functional Mindset Dinosaurs? A Systemic Approach Part 14
Shifting Your Focus from Cost to Throughput is How You Can Thrive–A Systemic Approach Part 15
The Science of Thinking Breakthrough from Dr. Domenico Lepore for Today’s Complex Business Environment
Sell More of What Your Company Does with the Resources You Already Have – A Systemic Approach Part 16
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