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Join Derek Hudson as he explores Essential Dynamics, a framework for approaching the challenges facing people and organizations. Consider your Quest!
Welcome to Essential Dynamics. I'm your host, Derek Hudson. Today, I've got my colleague, Dave Kane with me. Dave, how are you?
Dave Kane:I'm doing great. Happy September.
Derek Hudson:It's, it's it's pretty awesome that it feels like summer, and it says September on the calendar here in the great white north. Thanks to our listeners for joining us again on the Essential Dynamics podcast. We explore the concepts, that are part of the Essential Dynamics framework through deep conversations with interesting people. And today, you're stuck with Dave and I, but we expect to have some deep and interesting conversations. Dave, what's been on your mind lately?
Dave Kane:Well, it's been it's been a little bit because, you know, for a good chunk of August there, we we we sort of step back and and just let things energies come back up, and it's fun because we get to go out and I had more conversations with people who've either listened to this or we get into conversations about stuck and and building a birdhouse and all those things. So that was a lot of fun because summer was just about connecting, right, and and just sitting down and and exploring some of these ideas. So, I I really enjoyed that. But, you know, the piece that I kinda come with today is not everybody associates or feels stuck. A lot of businesses, I think, you know, we're actually doing alright.
Dave Kane:We're kinda moving along. But they do really like getting into the conversations along the very same topics, and it always comes back to systems and understanding their system and getting the flow in their system. So that's kind of what's been on my mind for the last week or so here. So I wouldn't mind helping or having you help me unpack systems a little bit and, and dive into that sort of topic.
Derek Hudson:Yeah, I'd be really happy to do that. You know, I ran into a couple of conversations and some stuff I read online recently, which kind of recast this for me a little bit. And, and that is the idea that you should have a system for your business. And if you don't have a system, you should have a system. I'm gonna phrase it slightly differently.
Derek Hudson:There's always a system. If, if you're in an organization, if it's a business, not for profit, or maybe even just a volunteer organization, it exists for some reason, people congregate to do something. And, it's not just one operation that does that. So there's a combination of, of the efforts of different people and different resources. That's a system.
Derek Hudson:Even if it's not designed as a system or referred to as a system, you've got a system. It might be a bad system. It might be system that doesn't work very well, but you've got a system. And, and the reason I think that's important is because if your system isn't working, then you have a systems problem. And if you have a systems problem, there are some ways to approach it that will be effective, and some ways that there won't be effect.
Dave Kane:Okay. So before we get into the fixing it, let's kinda work on what do you mean by a system because because you're right. I mean, every organization functions. Right? They get their stuff done.
Dave Kane:Maybe it's efficient, maybe it's inefficient, and they don't recognize it as a system. So let's explain a little bit about what do you mean when you're talking systems thinking?
Derek Hudson:John Yeah, and this is the great part about us being outsiders, in a sense. Like we're not trained in systems thinking and we don't have necessarily that vocabulary, but both of us are, I think, keen observers of organizations and what they do and what it looks like when they're doing well and what it looks like when they're not. And so from all that, I can, look at systems in a few very, very simple ways that I don't think they're oversimplified. I think they're just useful to start with. One of them is this just idea of, of creating something.
Derek Hudson:And so you've got the model, which is, input, process, output. And you take a resource of some kind, something's, just to start with, do some stuff, and at the end, the thing that you have is different from the thing that started. And, that's that's one way to look at a system. And and, of course, then that creates some questions about what output are you trying to make compared to what you do make, then what's the process that you use to get there, and who's working in the process, so that, presents us the opportunity to talk about the essential dynamics model. But before we jump into that, just, what what's your reaction to that oversimplification, Dave?
Dave Kane:I think it yeah. The oversimplification because it is not sort of this single linear line where a moves to b moves to c. Right? It's it's a complex interaction of all these things within the organization that's going to lead to the effective flow from input to process to output. It's not it's it's not that simple.
Dave Kane:And I think when I'm talking systems with people, I mean, that that's the the basic threat of it, but I look at machinery, or I look at nature, and I use those as examples of systems. And it's the interworkings of all these parts, all these different components of an engine that goes from gasoline to, you know, acceleration. And so it's that complexity, I think, that's the the heart of the systems thinking.
Derek Hudson:Yeah. So, well, maybe that's right, that systems thinking is the distance you have to travel from, the oversimplification that I made, input process output, into the complexity of all of the different systems and subsystems and operations that have to be in place to get a really desirable outcome. And then the management of that, which is very difficult because you can get lost in the complexity, or you can stay at the oversimplified state, and both of those are, are challenging in terms of being being effective. So, do you wanna talk about, like, just the example of a biological system and
Dave Kane:Sure. Like, you look at the human system, and, you know, helping kids through bio 30 and it's always compen carp broken up into little pieces.
Derek Hudson:Compartmentalize. That's the worst.
Dave Kane:Thank you. I was just tripping on my words. And so, you know, you go study the circulatory system or you go study the respiratory system or, you do all these pieces. But when you're talking human health, they're all tied together. Or if I wanna get better, better health, I can't just go and look at why better change my diet.
Dave Kane:Well, you probably better go, you know, work on your fitness and your sleep and your mental health and all those other things they tie together. And so, to me is when you're talking about trying to do the system and improving a system, you can't look at one element of it. You have to look at the interplay and how they all connect.
Derek Hudson:Exactly. And that's why I go back to this idea that it's not your, your business needs a system. It's that your business needs a
Dave Kane:It is a system.
Derek Hudson:The business needs a functional system and it has a system. And, and the reason that's important is, as you say is, you can't take a discrete element out, fix it and put it back in and expect that, you've done everything that needs to be done. I was thinking of an example of that, on my walk this morning. So you've you've let's say you have a high functioning business. It's it's performing really well.
Derek Hudson:It, it has what we call flow, and, everything seems to be in the right place at the right time, and it's working fine. But then you run into a situation where a critical part is unavailable, and while you have the, the equipment and the people and everything else you need to make this component that you're gonna pass on to your customer, you can't because of this critical subcomponent. So you could say, if you're not taking a systems view, we have a we have a simple problem. That problem is that we, don't have the subcomponent. And so it's a purchasing problem, and we need a purchasing solution, and we need to get that thing in place, and then we'll be able to ship again.
Derek Hudson:But it's never that simple.
Dave Kane:Mhmm.
Derek Hudson:It's never that simple. You could ask the question, well, if this is so critical to the customer, where was the risk management plan, that, anticipated this kind of thing could shut you down? Or perhaps the problem is is you don't carry inventory of those parts because, your finance team is trying to save cash, and so they won't let people spend money in inventory. And as a result, you're not, shipping product. Or it could be that, the purchasing person that was supposed to make sure that was in, took a few weeks off, and nobody read the emails that, were sent to that person about the disruption that was gonna come.
Derek Hudson:All I mean, maybe it's all those things. Mhmm. And that's this that's the systems view that you have to take. So there's never a problem that's just a purchasing problem, you know, I would say.
Dave Kane:Right. And and approaching it that way, the the pieces you hit on is you're gonna build in efficiency, and you're gonna build in resiliency, right, by by having the system understood and and viewed that way.
Derek Hudson:That's right. And so, you know, I guess the concept we're trying to get across here is you're living in a system. If you're in an organization, you're actually living in a bunch of different systems in your life, but we don't have a lot of tools. We're not given a lot of tools in our education and in the work that we do to think about systems. Because that's that's I've been looking and I that's that's my experience so far.
Derek Hudson:Mhmm. Like, for example, you just talked about you have a a child that just graduated from high school, and they're they're probably concerned about their marks and the matriculation and getting into university, but, you know, can you list off some of the some of the, stuff they studied in school?
Dave Kane:Well, yeah. You go through this thing where they have their sciences, and they have their basic math and socials and and and the courses, but they've also learned, you know, the social interaction. They've learned how to study. They've learned all these skills that when they go off to university, it's, yeah, you're going into a single subject now, but it's all these other things you've learned that sort of are necessary, I think, to make you succeed.
Derek Hudson:But those those things aren't, aren't, taught as a subject. The most valuable things you get out of high school are not taught as a subject, and the subjects are parsed out into these topics, that you need to understand all of them to be able to work in an organization or to function in life. And then it only gets worse when you get to university, in terms of the specialization. And then you go through that, and, you can't just be in engineering. You have to choose between civil and mechanical.
Derek Hudson:And, then when you're in one of those disciplines, you have to specialize even further. And maybe that makes sense for some technical stuff, but I know, both of us have, business education, and we started everything was broken up right from day 1. Yeah. I took no course in university that purported to teach me how to think of an organization as a system.
Dave Kane:The subjects rarely cross over, and even, you know, the best examples of that when you get, even when you get into, like, case based learning, you're you're taught to to think about the different elements of it. You know, what is the the marketing application? What is the finance application of this? But you still look at it through all these different lenses. You're never intertwining them.
Dave Kane:You're never looking at how they, how they impact each other in sort of that, interrelated way.
Derek Hudson:So I was wondering today, as I was thinking about my sort of chosen path in my career at this point in my life, and wondering, you know, how I got here from, having an accounting major in university, and, and then getting my my CA designation. And one thing I can say about accounting and financial reporting is, that is one system that touches all parts of the organization. And, and it's only one way to look at it, and, and some of my colleagues think it's real. But the one thing that a balance sheet does is it accumulates all the financial impacts over time for the whole organization in one place. And that gave me the ability, I think, to start to see, the system.
Derek Hudson:And then of course, I realized that wasn't the whole of it and started learning a little bit more about operations and strategy and stuff. But that's the, that's the thing that we need to do is to, we need to learn to think about, about systems because that's where the, that's where the challenges and opportunities
Dave Kane:are. Yeah. Well, it's a lens to look at all those things. It's not the tool to help. You need to change your thinking, not, not the lens through which you look at it in order to, to view it as a system.
Derek Hudson:You need to change your thinking. So let's talk about that. What does it mean to use systems thinking? What are people missing or what can they start doing?
Dave Kane:What are they missing?
Derek Hudson:We have the tendency, when we think about systems, to do, I think, 3 dysfunctional things. One of them is to oversimplify and to just look at the surface and, and wish kind of that we could push a button and change the system. The second one is that, that we can break it up into subsystems and then try and optimize the subsystems, and that tends to be the sort of organization chart way to do it. And the third one is, is that we can get so enthralled by the complexity that we just dive in. And, and, and, you know, we, and we never come back out.
Derek Hudson:So the oversimplification, I think you see that a lot in political solutions. There's a problem with the economy or, homelessness or, health care or something like that. And so the government proposes a solution, and they have a press release and ribbon cutting, and then this is gonna solve that problem. And it's never that simple. And this and their problems the solution is typically something you're not gonna be able to cut a ribbon about anyway.
Derek Hudson:But there's this oversimplification. I think for a lot of, us, it's, wishful thinking.
Dave Kane:Right.
Derek Hudson:Yeah. Like, we wish there was a button we could push, and so we will imagine and act like there is 1.
Dave Kane:Right. And trying to solve it or or get, you know, value at the other end when you oversimplify, you either end up with an unintended consequence, or you don't get the magnitude of value you're pursuing.
Derek Hudson:Yeah. So the worst case scenario is you don't get what you want and you get a bunch of stuff you don't want, and that's probably more often than not, that's what happens.
Dave Kane:Yeah. Whereas if you break it into the components, which I think you see far too often in in organizations that are siloed. You know, they they head off on an initiative that's going to improve something within the system, but it's it's in isolation. You know, you get that local optimization and you you get you get an outcome, you're seen as doing something, and you you do get a lift, but it's not as it's not as magnified as it could be.
Derek Hudson:Well, the improvement doesn't make it to the end of the line, and perhaps even the the improvement wasn't designed to make it to the end of the line. That example
Dave Kane:So with my my health thing, and I'm trying to trying to get healthier. And, you know, it's it's a system of my my fitness, my eating, and my rest, say, is oversimplified, and I just go off and and change my diet. I'm gonna see some benefit, but I'm not improving the system as a whole, and I'm not getting, I'm not gonna reach the end goal.
Derek Hudson:Exactly. Exactly. So there so that breaking it down, picking an isolated thing to work on, typically doesn't work. It could, if you get picked the right thing, but without systems thinking, you don't, you don't know, what that is. And
Dave Kane:so what about over complicating, making, diving into the complexity? What's, what's an example of that one?
Derek Hudson:So so I used to work with, almost exclusive exclusively with engineers and scientists. And, so I'll just share I'll just share one example. I won't use his name. It's a guy that I think very highly of, and he's an awesome engineer. But, we had a project that was delayed, And, so he was presenting to a group on what was going on with the project and why we hadn't solved the customer's problem yet.
Derek Hudson:And so he gave us a detailed technical explanation of, of a particular experiment that was done, and then explained why that failed, you know, sort of catastrophically. Now these are micro scale things, so it didn't blow up a lab or anything, but it didn't work. And as he explained what went wrong, his eyes kind of lit up. And then he went on to the the next iteration, and they tried something a different approach, and it also didn't work, and his eyes lit up even more. And what I realized at some point was that, he was not looking at the same problem I was looking at.
Derek Hudson:He was learning. He was learning about, physics. He was learning about, you know, processing these wafers. He was learning about what didn't work. And every time he did that, he learned something, and that's what he enjoyed doing.
Derek Hudson:And he he lit up when he learned a new nugget of truth. I'm worried about billing the client and moving on to the next project. So we had a little bit of a recalibration after that as that insight came out, and we had to help the project engineers understand that we were doing what we agreed to do with the client as fast and as best as we can. And we're gonna learn along the way, but we can't we can't kinda reverse that order because they were just in love with problem solving.
Dave Kane:Mhmm.
Derek Hudson:And, so if you, if you love complexity, there's no end of complexity in an organization, and you can dive in and you can feel like you're solving problems. But if you're not solving the problem that's holding back the flow, then it's you're you're not helping the system.
Dave Kane:Yep. And I'm guilty of that one as well. I mean, I can think of several examples of, you know, overzealous model building, that's gone past where it needed to be in order to achieve, and you lose sight of the forest for the trees, right? It's, this is what I'm excited about, this is where my passion has taken me, and I missed the mark.
Derek Hudson:So, so those are some ways that, you know, looking at the system, unproductively, but still feeling like you're doing something helpful. So maybe let's, let's just talk about words for a second, because I want to introduce, or test a concept. We've we've used stuck on the podcast and in our work for a long time. And, and and you said, Dave, you've run into people who say they they don't think they're stuck, but still they're still captivated by conversations about, about the system.
Dave Kane:The system and and the process to improve their system Yeah. Or even understand their system better.
Derek Hudson:So so stuck stuck might be a little bit of a firm, position to take to say, you know, in some people's minds that's just like, we're not producing anything. The system is like ground to a halt. Other people would view stuck as, I'm sitting outside the system. I'm trying to improve the system, and I'm stuck because I can't figure out a way to improve the system. Mhmm.
Derek Hudson:And so, if the system isn't performing to its potential, they may not be stuck, but there's still room for for improvement. And so somewhere in there, I wanna use the term, system dysfunction.
Dave Kane:Okay. Yep.
Derek Hudson:Which which is that, yes, there's a system. Maybe we've not designed it. It exists. You know, we are getting some output. We we've gathered together to accomplish something, but there's not, we're not, we're not experiencing flow.
Derek Hudson:We don't, we're not producing at the rate or the efficiency or the quality that we want. People are frustrated. Too much of stuff, takes too much work. There's, too much intervention, and rework, and expediting, and, negotiating, and cajoling, and coercing, and motivating. That's system dysfunction.
Dave Kane:Yeah. I like that. I can I can sort of see that? Let's let's start to explore that one may maybe a bit more next time, but I I like the idea of using that term because it brings in the flow, and it doesn't sort of singularly focus on, well, it's broken or it's it's purely inefficient. It's it's dysfunctional because it's now understood and can be better, and there's pieces in it that, you know, we can isolate and and improve on.
Dave Kane:Is that kinda where you're going with it?
Derek Hudson:Yeah. That's that's where I'm going with it. And so, well, I'll do it in other avenues as well, but in the to the listeners of the podcast, I am very interested in hearing stories about system dysfunction in organizations. I'm also very interested in hearing stories about systems dysfunction that was addressed and, and, managed and became systems flow. But we I think we can learn a lot if we ask the question, what's dysfunctional in the system, or what's not flowing, in the system?
Derek Hudson:And I would also add that the nice thing about systems dysfunction is it's I don't think it's accusatory. I don't think it's blaming. I don't think we're putting it on someone to say, you're doing a bad job. Systems are complex. They need maintenance, they need design.
Derek Hudson:When that doesn't happen, the system, can be dysfunctional, and it's not a particular person's fault, but it's everyone's opportunity to, to address
Dave Kane:it. I like that. And in my mind, as you're saying it, you know, it's not always easiest to sort of go and pinpoint the dysfunction in the system, but the element you brought in there was was the flow piece. And so often, when I'm looking for it, it's within the value flow, the information flow, the energy flow, the cash flow. It's the impediments or the the things that are are are, you know, narrowing the pipe a little bit.
Dave Kane:And so that that has helped me in the past to identify, well, there's these dysfunction. Now let's go explore the system and figure out why it's there and what's going on.
Derek Hudson:Yeah. So there's, you can look at outputs to the system, and and note systems dysfunction. You can look at, things that are blocking the system. They they you can observe, and that that indicates system dysfunction. There's also a feeling.
Derek Hudson:I I think there's a I mean, flow is can be psychological as well. If you go to work, and you feel like you're part of a team that's people are working together, and and producing stuff, and and you've got each other's backs and stuff like that, that's an indication your system's working. And if you feel like you're fighting or you're under attack, you don't know what to do. There's confusion. There's bad morale.
Derek Hudson:Those are all signs of systems dysfunction. I kinda feel like, I wanna, you know, offer t shirts at our merch store that we haven't set up yet, and there's 2 in mind, and you got you tell me if you if you think it's 1 or the other. The t shirt either says it's the system stupid, or it's the stupid system. And I'm not sure which one I, which one I'm holding to right now.
Dave Kane:I think the latter one there might get you fired, but, Yeah.
Derek Hudson:I guess, I guess we can call the system stupid. We should never call anyone stupid. So that it might That's true.
Dave Kane:At least you're taking the personal side out of
Derek Hudson:it, so. In my family, growing up, the s word was stupid, and the other s word was shut up. That's as vulgar as it got in our house.
Dave Kane:So we we've come up with this new, introduced this new definition of this system dysfunction, talked about some of the the ways it can cause. I think we should sort of wrap it up here and come back next time and actually dive into, okay, now what do we do about it? Or how do we identify it more clearly, and then what do we do about it? So
Derek Hudson:Alright. So, let's call this one, an inter interim, interim stopping point. Dave, thanks very much for being on. Dave Kain is with me at Unconstrained. Brynn Griffiths, as always, is, making us audible.
Derek Hudson:Thank you very much. I'm Derek Hudson and apologies for using the s word on the show today. And until next time, consider your quest.