What did Schellnhuber say this time?

Some of you may recall that Hans Joachim Schellnhuber and his research team produced a very good article on potential tipping points in the environment. I happened to find an interview with him in Der Spiegel entitled 'Industrialized Nations Are Facing CO2 Insolvency.'

What do you think?

Growth from a German perspective

Der Spiegel just published Can Economies Function without Growth?, which directly relates to some of the conversations we've held here in the past.

What do you think?

Sustainability by Cairns

Every once in a while, I run across a classic article I'd like to share. I've run across this one by John Cairns, Jr. several times, and I'm ready to recommend that you read it.

Cairns published Will the real sustainability concept please stand up? (link fixed) in 2004. He provides much insight in the space of four pages.

If those insights made you think (and learn), check out his Web site for more of his papers.

A systems take on math and science education?

Richard Hake, Emeritus Professor of Physics, Indiana University, recently posted an article describing how US colleges and universities are gradually coming to the view that they can't simply blame US secondary schools for the quality of math and science education incoming college students have, for the teachers and administrators of those secondary schools are themselves almost all products of the US college and university system.

This seems like closed-loop (feedback) thinking in action. Check out his Mobilization for Math/Science Education - Role of Higher Education.

Creating sustainability in complex ecosystems

I recently had the privilege of teaching a course in system dynamic for Willamette University's Sustainable Enterprise certificate program. The course lasted two days, with a follow-up two-hour web seminar. We focused on qualitative system dynamics, but we treated it at a somewhat more rigorous level than many such courses, I think.

I'm writing because of one particular lesson I learned—we all learned. Early in the course, we used a simulation game to help people have a common, shared experience of interacting in a challenging system environment.

As with many such games, the expected result is that people fail in making the system work. Typically, the debrief is used to help people understand the ways of thinking that led them into trouble and to prepare them for the material that's to come.

Unexpectedly, this class managed their challenges quite sustainably. While their skill wrecked the planned flow of that part of the session, I was really pleased to see their skill in action. We spent some time talking about what made them successful and how that might carry over to real-world situations. Their insights were useful enough that I wanted to share them (with the students' permission) with a larger audience: you.

I first asked what made them succeed in the game and what provided the most challenges.

Goals were the first. While the game tells them the goal they should have, they rapidly realized that focusing on the stated goals would lead to ruin, and so they decided to set a much longer-term goal.

Communications was the second factor. After the first round, they began to spend most of their time huddled in the center of the room, talking animatedly through their decision-making processes instead of working in isolated teams.

They noted that delays provided a key challenge. As they worked to establish trust in the social system they had set up, they were both trusting other teams' commitments and verifying that they were indeed living up to their commitments. That takes time: commitments made today may not show up for quite a while.

Those delay effects were complicated by the natural delays in the system. Without revealing the game we used, I will say that the dynamics of the game included natural delays between actions and results that complicated decision making.

Some noted this seemed analogous to the situation OPEC finds itself in. They rely on mutual agreement to limit production as a way to manage prices. If anyone in OPEC breaks that agreement, the system can collapse. OPEC's problems are complicated by uncertain demand and uncertain prices, factors that had no analogy in our game.

Math skills created another success factor, which some may find surprising. A subset of the players rather immediatedly began developing quite a useful understanding of their system based on a mathematical model they developed. Once others saw that their results were accurate, everyone became driven by the data. Without some in the group being able to pull that off, they would likely not have succeeded.

Interestingly, trust and math worked together. At one point, the analyst team made a numerical error and then made an especial effort to communicate that they had made that error to others so that the others would be able to differentiate that error from a breaking of the trust relationship. Apologies were key. Information and the lack of information thus played a key role in the group's success. Even then, it took time for the others to regain their trust in the analysts' team.

Playing into this was the lack of external shareholders. Everyone on the teams had a serious take in the workings of the game; no one was in it just for the "money." Similarly, there were no new entrants into the field who might have upset the cartel relationship they had crafted.

I then asked them what they'd advise people in the real world.

Collaboration was the first clear answer. Work together across groups to align goals and actions.

They then said, "knowledge is power." After a bit of reflection and revision, they revised that to "timely, transferrable, actionable knowledge is power."

They felt it was important for everyone to be clear on a vision.

They would encourage people to watch their egos and to be visibly trustworthy.

At one point, in an attempt to test the strength of their commitment (okay, as an attempt to derail their commitment), I as facilitator announced I was the government and was giving them something they really didn't want. (To be accurate, that idea came from Anne Murray Allen, the executive director of the program, who was running the simulation computer.) For a while, I felt as if I were about to experience the French Revolution, as some rather emotionally argued for standing up to government and refusing my help, a bit of resistance I wasn't accepting.

As a result, their last bit of advice was to "Don't trust the wisdom of government, of the private sector, ... of either." In other words, test the data and the reasoning yourselves instead of blindly accepting what others say is good for you.

This was an intense and very exciting two-day workshop. I think those in the class learned a lot; I know I learned as they taught themselves and me (and now perhaps you) how to make sustainability work.

Perhaps I'll see some of you there next year.

Welcome to Pegasus Communications

Today I'm welcoming Pegasus Communications and their new Leverage Points Blog! They've done much to foster systems thinking over the years, from publishing The Systems Thinker, the free Leverage Points, and many of the major books at all levels of systems thinking and system dynamics to putting on the annual Systems Thinking in Action conference. Check them out.

And thanks, Janice and the others at Pegasus Communications, for listing Making Sense With Facilitated Systems among the august company in your "In the Loop" list.

The (un)Sustainable Commentator on growth

Just to keep the question series on growth going, here's what Wayne Maceyka is saying on The (un)Sustainable Commentator.

Check out Wayne's blog, too, and his extensive list of links in the right-hand column.

Questions on growth: a follow-up

After all of our good questions about growth, we've gone silent, so I was about to change topics. Then I saw The Growth Bubble on Tom Fiddaman's MetaSD and its link to Thomas Friedman's The Inflection Is Near?

It's a Friday night after a long week, so I'll leave it to you to make the editorial comments.

Sustainable Enterprise: the opportunity

If you're in or near the Portland, Oregon area or willing to travel to Portland, you might be interested in Willamette University's Sustainable Enterprise Certificate program. It consists of three two-day sessions: Understanding System Dynamics, Social Systems and Sustainability Success, and Creating & Implementing a Sustainability Plan. The first one starts April 2.

Check out their Web site, and sign up now!

The other problem

I occasionally write about climate change and energy, but I've also noted, thanks to an initial reminder by Jay Forrest, that we also have to learn how to get along together. Now Lord Nicholas Stern says much the same thing in Expert predicts dire scenarios of climate change: mass migrations and war.

It would seem we have two major problems to address.

Thanks to AltEnergyNews for the tip.

Questions on growth: a pre-evaluation

You've helped me accumulate quite a list of questions about growth, and I thank you. Here they are once again:

1. What if (aggregate) growth went to 0% forevermore? What would it mean to you, to your business, and to your personal life?
   
   
2. Do you think there's reason to believe growth could stay at 0% or below for a very long time? Is that of necessity either good or bad, or does its value depend upon our reaction?
   
   
3. Is it a good idea to try to keep growth positive? Why? Are there any downsides? Are there indeed any limits to growth, either in terms of annual growth rates or the overall size of anything?
   
   
4. As attractive as growth may be in the current worldview, systems ideas would indicate that the longer we try to keep growth going once we've exceeded the carrying capacity of the system (the planet), the worse the eventual and inexorable fall and the lower the eventual sustainable standard of living. If you favor continued growth, how will you overcome those seemingly inviolate systems limitations?
   
   
5. If the systems theories play out in the real world, how do we reasonably make the transition from our current state to a new, equilibrium state in ways that attend to people (social justice, the ability to procure what we need for life, the ability to make a difference or find purpose, etc.) and the natural environment (sustainability, the depletion of nonrenewable resources)?
   
   
6. Can we make such a transition a good thing and not a painful thing?
   
   
7. What do we owe our descendants? For how far into the future do we bear responsibility?
   
   
8. If these systems ideas have merit, what changes in mindset (in worldview) do we need to survive emotionally as well as physically? For but one example, negative growth has long meant failure for people leading businesses, but that could be the way of the future. Can we realistically change our mindsets and our systems so that satisfying needs (instead of generating growth) defines success?
   
   
9. In case these systems ideas don't apply in this situation (e.g., if technology can once again save us even in the face of decreasing energy supplies and rising population), can we design robust actions that work well in either eventuality? How do you answer Tom Fiddaman's questions about the sufficiency of technology?
   
   
10. Can the current economic "engine" be morphed into one based on such a radically different paradigm?
    
    
11. If we change to a different paradigm that's not built on growth, can we figure out how to get money into the hands of all who need it? Or will our reaction to low or zero growth be to trim people out of companies to keep the organizations viable while building unemployment?
    
    
12. Is an economy built on lending inexorably drawn to growth for survival?
    
    
13. How we to encourage understanding that quality of life can still improve while quantity of consumption decreases?
    
    
14. In light of the current economic crisis, how can we best protect the economy's life-supporting functions such food production, health care and ecosystem services amidst the chaos that will undoubtedly trim the less important financial and luxury markets?
    
    
15. What new national and international policies and institutions do we need to design in order to prepare for a transition to a steady state, or true cost, economy that recognizes the need for investments in natural and social capital as well as financial?
    
    
16. What would constitute the analogy of complex relationships those with "imaginary" components?
    
    
17. Will a state of zero net growth become a state of dynamic economic equilibrium, and will this new state actually make markets MORE efficient, and effective at elevating the state of the common man?
    
    
18. Why is our world so hung up on growth to begin with? How did growth get into our DNA? Has it always been there or is it just since the invention of the steam engine?
    
    
19. What do you do if evolution favors individuals or groups who aspire to growth?
    
    
20. What if the US and EU go green and China and Russia don't?
    
    
21. What if growth had to be -X% per year for Y years in order to reach a sustainable steady state (in material throughput)? How might social systems accommodate that peacefully?
    
    
22. What if technology has limited potential?
    
    
23. What would an evolutionary landscape that favored sustainability look like?
    
    
24. Can wealth can go up while the material flow goes down? How?
    
    

I've numbered them this time for easy reference. If you want to see who contributed each question, refer back to the original posting.

Now the next step: how would one go about answering these questions?

Before getting to the process, though, I'm curious how you think we would recognize a good answer. I don't expect that we'll all agree, but, rather than getting into a bunch of statements about our respective positions, I think we might learn more by first thinking about the criteria by which we'll evaluate potential answers.

I suspect our answers to that may be all over the map. As food for thought, I offer up the questions critical systems heuristics offers about motivation, control, expertise, and legitimacy. You can find one article by Bob Williams and Martin Reynolds on Bob's Web site: go to Systems Stuff and scroll down to the article called Critical Systems Thinking. You can see another introduction by Werner Ulrich here. He lists the questions starting on page 11, but you probably need to read the earlier pages to understand what it all means.

Once we have some idea how we'll evaluate potential answers (and how we think we should evaluate them), then we can think about picking approaches, methods, methodologies, or processes we think might be of use for each of these 24 questions.

So what do you think? How will you evaluate the answers to these questions? How do you think you should evaluate them?

Questions on growth

From time to time, I've posted some of my musings about growth. I had a related email discussion recently with a colleague, and one of my emails to him contained questions that I'd like to ask you, too.

We know the world's economies are currently experiencing hard economic times. Yet I wonder if thinking of this in terms of business cycles is the best way today. Jay Forrester has written, "Our greatest challenge now is handling the transition from growth to equilibrium".

If you think of the world in terms of business cycles, getting from bad times to good is a largely waiting game, assuming you've saved enough in the good times to carry you through the bad. Before refrigeration and long-distance transportation of food, that happened on an annual basis, too: you had to save enough food from this year's harvest to survive to next year's. Admittedly, some organizations are good at gaining ground during these periodic "yellow flag" situations, but many of us will just try to survive until the good times return.

If Forrester and others are correct and we're really moving from a long period of growth into an even longer period (possibly forever, at least in practical terms) of relative equilibrium, then dealing with those (equilibrium) times may require a fundamentally different mindset (as Cynthia McEwen and John Schmidt would remind us), not just a changed process.

• What if (aggregate) growth went to 0% forevermore? What would it mean to you, to your business, and to your personal life?


• Do you think there's reason to believe growth could stay at 0% or below for a very long time? Is that of necessity either good or bad, or does its value depend upon our reaction?


• Is it a good idea to try to keep growth positive? Why? Are there any downsides? Are there indeed any limits to growth, either in terms of annual growth rates or the overall size of anything?


• As attractive as growth may be in the current worldview, systems ideas would indicate that the longer we try to keep growth going once we've exceeded the carrying capacity of the system (the planet), the worse the eventual and inexorable fall and the lower the eventual sustainable standard of living. If you favor continued growth, how will you overcome those seemingly inviolate systems limitations?


• If the systems theories play out in the real world, how do we reasonably make the transition from our current state to a new, equilibrium state in ways that attend to people (social justice, the ability to procure what we need for life, the ability to make a difference or find purpose, etc.) and the natural environment (sustainability, the depletion of nonrenewable resources)?


• Can we make such a transition a good thing and not a painful thing?


• What do we owe our descendants? For how far into the future do we bear responsibility?


• If these systems ideas have merit, what changes in mindset (in worldview) do we need to survive emotionally as well as physically? For but one example, negative growth has long meant failure for people leading businesses, but that could be the way of the future. Can we realistically change our mindsets and our systems so that satisfying needs (instead of generating growth) defines success?


• In case these systems ideas don't apply in this situation (e.g., if technology can once again save us even in the face of decreasing energy supplies and rising population), can we design robust actions that work well in either eventuality? How do you answer Tom Fiddaman's questions about the sufficiency of technology?
  


• What other questions do you have?

Let me be clear: aggregate growth of 0% does not imply that there is no dynamism, no growth in the economy. Our need for certain products and services will increase, even as our need for others will decline. I'm only thinking of aggregate growth in posing these questions.

I have lots of questions and only tentative answers. Right now, I really am interested in seeing your questions, as I've seen the power of listing questions before trying to provide answers.

Later, we'll get to considering answers and how we might test those answers for reasonableness and usefulness.

Questions?

Management Improvement Carnival: Annual Edition

John Hunter of Curious Cat has asked me to participate in the annual edition of the Management Improvement Carnival. I'm humbled to be invited and glad to participate.

The first station has to be Tom Peters' blog. I don't agree with everything he says, but I do find that he makes me think. Any of you who manage something are people, too. That's why my first link goes to his Christmas 2008. I share his sentiments, if not his bully pulpit. While I'm mentioning his blog, I'll also mention Repeat!.

The next station is MetaSD, the home of Tom Fiddaman and his Four Legs and a Tail. It's a good reminder of the leverage points we can seek in the systems in which we work as originally drafted by Dana Meadows, and it offers his notion that they don't necessarily compose an ordered list. Perhaps more importantly, it's a reminder that we need a mindset change to be successful in the world we're entering. Speaking of mindsets, Cynthia McEwen and John Schmidt of Avastone Consulting have published Leadership and the Corporate Sustainability Challenge: Mindsets in Action Report. While not a blog, that report does speak to mindset changes. Speaking of Tom Fiddaman, he has also posted My Bathtub is Nonlinear, an excellent reminder of the importance of grounding our assumptions in real data.

Times are tough, economically, and that's why I pick Paul Graham's Why to Start a Startup in a Bad Economy as the third stop. Don't do anything foolish, but don't think that the news from Wall Street necessarily predetermines your fate is the message, but he says it better than I. While I'm visiting non-conventional management sites, I'll stop at Elana Centor's Note to HR Folks: Hiring Over-Qualified People Is A Smart Strategy because you will need to hire again someday, if not today.

Speaking of saying things better, one of a manager's jobs is conveying information, and much of that information comes in the form of numbers and graphs. We do our organizations, our people, and ourselves a favor when we display such information clearly so others can make sense of it well. That's why the fourth stop in this carnival is at Andrew Gelman's An improved time-series graph instead of that notorious "spiraling down the drain" spiderweb. Follow the links, too, to see his earlier commentary. I'm a fan of Edward Tufte's approach to communicating information, and I'm a fan of the second graph in that posting. If you have to add drama, I like the third graph much better than the first, but I still think the second is the best of the three.

As important as data and statistics are, I'm reminded by xkcd's Decline that not everything we do, not even everything we do as managers, is best served by quantification and purely logical analysis. That brings me to Andrew Taylor's Not aloof and detached, but deeply, deeply human, a link to a Benjamin Zander TED presentation that, for me, brings together presentation skill and leadership in the service of his passion, music.

Finally, I'll take a view of another system we may not think of much, one that we very much need to be working well and one that may offer opportunities for some of us: food. Marilyn Holt's A Locavore Manifesto by Michael Pollan is a great education and reminder; click on the title of her post to get to the manifesto.

You may have thought I'd post about IT issues, about process improvement, or about systems or statistical analysis of management work. Those are indeed important, and I don't want to neglect them.

Yet I've found it helpful to start thinking at a high, systemic level to make sure I'm considering the important issues and to help me determine where I need more detailed information. While this, like most summaries of blog postings, can't claim to be as organized and logical as a book, I think it covers issues we need to concern ourselves about in business. From how we deal with people to the mindsets we bring to our work, from how to work in a tough economy to how to convey information, this covers a broad range. I closed with food systems because I wonder if we may be entering a period where the major systems we need for business—food, energy, the atmosphere and the overall environment—can no longer be safely taken for granted. That's why I think the desire and ability to view our challenges through a systems lens is particularly important as we enter 2009.

I'll conclude with with Tom Asacker's Nine Predictions for 2009, thanks to Tom Peters' Must Reading.

Follow-up:

To find the rest of the Management Improvement Carnival, check out these links:

• Management Improvement Carnival Best of 2008
  
• Got Boondoggle?
  
• Quality and Innovation parts 1, 2, 3, and 4
  
• Lean Blog
  
• Elegant Solutions
  
• Evolving Excellence
  

Were Bill and Dave right?

Much of the focus in righting the economic system seems to have focused on lending: fixing the effects of bad loans to get good lending going again so that companies and the economy can once again grow.

Yet, thanks to Justin Tilson, I discovered Chris Martenson's Crash Course. It makes the claim that debt is a key factor in creating growth and the problems of growth. I found the series interesting, but I wasn't in tune with his recommended solutions. They struck me a bit too much as "run for the hills" and not enough "here are some ways we together can craft systematic solutions." I should listen again to see if I get a different impression in a second pass, but I don't have the time. That's why I usually prefer well-written and -illustrated text to video—it's faster to read and faster to review—but that's just my personal preference.

Later, reading (or reacting to) James McCusker's Federal loan guarantees mean more jobs made me wonder: did Bill and Dave get it right on a more global scale than they perhaps realized?

What does that mean? If you know that I used to work at Hewlett-Packard and you recall any of the twentieth century history of high tech in the USA, you likely know that I'm talking about Bill Hewlett and Dave Packard. In one famous case, which you can find described in multiple books, Dave returned from his stint working in the US Department of Defense to find that HP was about to raise money through significant borrowing. His reaction made it abundantly clear to a generation or two of HP managers that HP did not raise significant money that way; HP funded future growth out of current profits.

Putting McKusker's commentary, Martenson's ideas, and Dave's values together, I wonder if a focus on supplying real needs and growing through profits rather than growth for growth's sake and growth through borrowing would be better for businesses, better for the economies of the world, and better for people.

Incidentally, McCusker is in favor of more loans right now to get the economy moving again. With so many people out of work, I realize that something must be done and that interim measures may not match long-term solutions. I'm musing about long-term approaches here; how to get from here to there is a different matter.

What do you think?

PS: If you wonder what Dave's reaction to debt was, ask an HP veteran of the time, or check out Chuck House's and Ray Price's upcoming book; I'm sure it will mention it.

IMT 586: Information Dynamics at the University of Washington

If you are a University of Washington graduate student interested in understanding the impact of information feedback on the systems in which we live and work, check out this winter's IMT 586 (also offered as INSC 586). This is the second year it's been offered, and I'm looking forward to exploring this field with a whole new group of you. If there's enough demand, we hope to offer the follow-on IMT 587 in the spring this year, so there's even more potential this year than there was last year.

If you are not a UW graduate student, but you are an interested professional who lives within commuting distance of UW, consider signing up, too. For any of you, studying system dynamics (okay, it's offered in the Information School, so we call it Information Dynamics) offers a great opportunity to learn a new way to make sense of the challenges we face and to find and test solutions.

Last year, all of the students brought their laptops to class. That let us create and explore computer models and simulations in class, which seemed to make for faster, more solid, and much more interesting learning. I hope to do even more of that this year. If you sign up and can bring your laptop, great. If you can't because you have a desktop machine, that's okay. We'll be fine as long as at least half the class brings laptops.

I look forward to seeing many of you in January! Please ask if you have questions.

(Past) Time for a tip on managing budgets?

Twice in times past, I've been in business situations where it was explicitly important to get a better handle on managing expenses. In the second case, the organization was seeing expense cycles of perhaps six months duration and couldn't seem to fix them.

When I saw the oscillations, I saw that as possibly coming from a structural problem. I created a system dynamics model that matched the structure of managerial decision making and accounting in the organization; with very few tweaks, I was able to reproduce in the model the essential behavioral characteristics of the real situation.

Seeing the structure laid out simply made it relatively easy to think of possible solutions, and I was able to eliminate the problem in the simulation by changing the information flows to simulated managers.

After getting buy-off, we implemented the changes in the organization, and fluctuations in spending variance dropped by 95%. What's more, we were able to adjust spending levels rapidly and accurately as needed to meet changing expense targets. That was fairly convincing proof that the model had been useful in identifying the cause of the problem and in testing proposed solutions.

Given current economic times, perhaps it's time to bring out some of those lessons again—or perhaps it was already time for that a few years ago. You can read more in Applying System Dynamics to Business: An Expense Management Example, where you can also find links to a model and to a published article on the project.

Incidentally, one of the lessons is that managing our personal expenses with credit cards is riskier than managing with cash. Read the article for more!

Grounding beliefs in data

We all have beliefs about the way parts of the world work. Data is sometimes hard to come by; when we can find it, it's sometimes in a form that's hard to use.

Tom Fiddaman published State CO2 Emisssions from Fossil Fuel Combustion on many eyes. Click through to the interactive version, and see if you find any surprises.

One set of lessons: it appears that industrial emissions have improved between 1990 and 2005 in about half the states of the USA. Emissions from electric power generation have increased in all but four states (all in the Northeast), and emissions from transportation have increased in all states but Kansas.

It would be interesting to see these results expressed in per capita terms, too.

While we're talking about data, see his experiments with his kids on how fast a bathtub drains. Before you do, though, what do you think a time series graph of the water left in a bathtub as it drains would look like? Then read the results.

To me, the bathtub experiment sounds a bit like Seth Robert's self-experimentation, which leads to the obvious thought that we can all be amateur scientists, if we want.

A systems thinking tour de force

If you're interested in ways of making sense of situations systemically (or interested in making sense of situations that don't seem to lend themselves to the ways you've thought of things in the past), see Bobby Milstein's excellent Hygeia's Constellation: Navigating Health Futures in a Dynamic and Democratic World. Yes, it deals with public health issues. No, you don't have to be interested in or involved with public health to learn from it. Yes, you might get excited by some of the ideas presented there.

Thanks to Bob Williams for bringing it to my attention. To be honest, I'm only about half-way through it, but I thought you might want to get an early start reading it.

For an interesting lash-up between the US Centers for Disease Control and Prevention and Google.org for estimating the progress of flu in the USA, see Google.org Flu Trends.

CAFE standards are so 20th century

While we in the USA struggle with CAFE standards, those regulations that limit the minimum average fuel efficiency of cars and light trucks, others are moving forward. The Europeans are considering a 120 gm / km CO₂ limit on automoble emissions.

Thanks to Ralf Lippold for the tip via a Tweet. Check out his 120g/km-Campaign wiki.

(I'll let someone else translate 120 gm / km CO₂ into "English" units; I'd rather we just adopt metric.)

More not good news

A bit over three years ago, I published Not good news; what do we do about it?, a story prompted by the Millennium Ecosystem Assessment.

Today, Grist News published Planet Ahead, a pointer to the World Wildlife Fund's 2008 Living Planet Report. In short, we're continuing to live beyond our (or the planet's) means, and, at current trends (not consumption levels, as reported in Grist according to my interpretation), we'll need two planet's worth of resources by the mid 2030s.

While they don't reveal the details of their model, it seems by their admission (p. 22) that it does not incorporate feedback effects. Thus it may miss behaviors that could prove dominant and perhaps more damaging over time.

One challenge is that the degradation is largely invisible to many of us. For one, many of the factors they measure are not bought or sold, so normal market forces don't make them visible nor work to manage their use. For another, the degradation is largely confined to tropical regions, yet I suspect most of us reading this live in temperate regions and don't really observe those changes.

Yet, amidst that gloomy projection, there is cause for optimism. They speak of "sustainability wedges" as an approach to help us have our cake and eat it, too, or at least to grow energy services and reduce greenhouse gas emissions.

The report is 48 pages long, so I've just skimmed it. I think it's well worth the time at least to skim it to become better informed on the current state of the world and current trends.

What does that mean for us in business? What does that mean for us as citizens? What are your thoughts?

Food policy

I heard part of a piece about food policy on Fresh Air recently, but I forgot about it until I read Marilyn Holt's A Locavore Manifesto by Michael Pollan in her Amicus Agraria. She points to Michael Pollan's thoughtful and thought-provoking letter to the US President-Elect called "Farmer in Chief" in the New York Times. Yes, it's long; yes, it's worth your time.

You can see prior postings about food in A Prius for the pantry?, No such thing as a free (or even cheap) lunch, and Food and fuel in the news.

Postscript: Thanks to a tweet from Garr Reynolds, I found the related Eat fast, eat until full to get super-sized.

Dealing with risk and uncertainty

Times are uncertain. Risks seem high. We may feel that the price of missteps is high; we know it's hard to decide what steps to take.

In situations such as this, how do you make decisions in and for your organization? How do you plan effective actions? How do you solve the inevitable problems that arise?

The German psychologist Dietrich Dörner, author of The Logic of Failure, has made a career of studying why people make mistakes and what we can do to improve. One of his key pieces of advice is to use computer simulation to get insight about the situations we face so that we can make better decisions in real life.

Perhaps today's uncertainties are your signal that the time is right to apply more systemic approaches in your work and to ground your planning, problem solving, and decision making with simulation that takes into account factors important to your business. Perhaps it's time to test and rehearse your plans before you implement them.

That's what we've been discussing here, and that's how I help others. If you're concerned that your standard approach to business may need augmentation in today's world, perhaps I can help you, too. Drop me an email or give me a call. There's no obligation—only opportunity.

System dynamics in Seattle

I just ordered texts for IMT 586, Information Dynamics I, in the Information School of the University of Washington, which reminds me to tell any of you at UW or within commuting distance who have been interested in system dynamics that we do plan on teaching system dynamics again this winter quarter. Registration starts November 7.

If there's enough interest, we hope to teach the follow-on IMT 587 in spring 2009. If you take IMT 586 this winter, consider leaving time in your spring schedule. If you took IMT 586 last year and would like to go further, think of IMT 587. If you've already got a system dynamics background (equivalent roughly to the first fourteen chapters of John Sterman's Business Dynamics) and would like to go straight to IMT 587, let's talk sometime before spring quarter enrollment.

I look forward to seeing you there!

The Age of Heretics: a review

I'm writing about a new book today, but first I have a disclaimer: I know the author, Art Kleiner, because I was on an extended panel discussion he led on organizational heresy that resulted in a small section of The Dance of Change: The Challenges to Sustaining Momentum in Learning Organizations. He and I have kept in touch from time to time since then, and he provided me a review copy of this book.

There. That's out of the way.

Art Kleiner has published a second edition of The Age of Heretics: A History of the Radical Thinkers Who Reinvented Corporate Management (J-B Warren Bennis Series). The executive summary: if you're in business, if you lead a business, if you consult to business, if you ever have thought of ways to make business work better, read this book!

Perhaps you read the first edition. So did I; I think I recommended it for the company library where I worked at the time and read it there. My recollection is that I liked that version, but I like this version so much more. Perhaps it's his new version; perhaps it's my added experience since I read that first edition (I no longer have easy access to check). Even if you read the first edition, read this one, too.

A heretic, in Art's view, is someone who simultaneously holds great loyalty to the organization to which they belong and a vision of a new truth the organization has yet to see. He has written about the evolution of organizational heresy by way of mini-biographies of archetypal heretics. There are too many for me to summarize, so let me simply refer to one as a way to whet your interest and to indicate what I think of the book.

I first discovered Chris Argyris's action science around 1992, about the time I began work with a group that eventually turned into a true high-performing work team. I had read The Fifth Discipline: The Art & Practice of The Learning Organization
and discovered reference to Argyris's work. As is often my custom when I read of new ideas, I like to find the original to learn more (perhaps I owe that to Dr. Malcolm R. MacPhail of Rice University, who would give extra credit in quantum mechanics for our reading related, primary research in its original language and writing summaries).

I picked up one of Argyris's books, probably about 400 pages long, and began to read. By the time I had read 50 pages, I had determined both that it was one of the most important books I had ever read and that I didn't have a clue how to apply its ideas. I kept reading.

At the same time, I was working with—managing—a team that had serious intra-group communications difficulties. I'd practice what I was discovering in meetings I held with them. Then I would come back to the book and try to discover where I had gone wrong. After a year or two of weekly meetings as experimental labs and after reading perhaps seven, eight, or more of Argyris's books, I discovered that the application of action science can facilitate breakthrough improvements in group productivity. I determined that action science has certain attributes:

• Action science requires great skills at discernment to see important incongruities in words that can help us improve our abilities to hold productive discussions in the presence of disagreements and even conflict. It also offers approaches to help us build our capabilities in discernment.
  
• Action science is a revolutionary approach that upends normal work cultures and offers the promise of real, revolutionary gains in productivity.
  
• There's an ethical principle that permeates action science. It's vitally important for each of us to find it and internalize what it means to us. That was, I think, central to my eventual understanding and use of action science.
  

Action science was perhaps the hardest material I've ever learned (even harder than some of the technical material I learned as an engineer). I think it was only the long, intense action research approach of reading, studying, reflecting, and doing (and often failing) that enabled me to comprehend and internalize it without a mentor or teacher.

Most books and articles I've read about action science (Bob Dick's and Tim Dalmau's Values in Action is a notable exception) attempt to make action science approachable, incremental, and easy to do. As important as some of those books are, I've come to the conclusion that those who see action science as anything but earthshakingly revolutionary and demanding of great personal courage and discernment have missed (or are hiding) the point.

Why this discussion? Because Art is the first writer I've seen who conveys that spirit in his description. He, like no other I've read, made that essence come alive. While you won't learn how to practice action science in the pages he devotes to Argyris's work, you may come away with a better impression of what it can do for you and for groups with which you work. Reading his words in conjunction with other material on action science may help you develop a deeper understanding and better practice of the approach.

Art did much the same for each of the heretics and their heresies throughout The Age of Heretics. He neither shied away from their warts nor downplayed the essence of their contributions. That has helped me put many past business and management developments into context, and that is why I recommend it so highly to you.

Now go read it!

The Marblehead Letter

I've written about my musings on growth a number of times, even as I worried that my ideas might be controversial.

Now I've seen the Marblehead Letter, written by executives at a SoL conference in 2001, and I think those of you reading this blog might find it worthy of your time. Read both the full letter—it's only two pages long, and I think it states its questions better—and the summary, which hints at some of the signatories.

Note that the letter has questions, not answers, and note that the letter comes from people high in the ranks of major organizations.

I discovered this letter by reading Presence: An Exploration of Profound Change in People, Organizations, and Society, courtesy of InBubbleWrap and 800ceoread. For various reasons, that's been a hard book for me to get through, but I'm persevering (and those of you who have a copy can tell the page I've reached by this blog posting). Perhaps I'll blog more about it when I finish it.

What do you think? It's comforting to know that others are considering similar questions to the ones I've been raising. Question 3 is exactly what I want to work on, but reading it brings two thoughts:

• You can't address that one question in a vacuum; you have to consider their other questions and still more (for example) in the process. It is a systems issue on multiple levels.
  
• I wonder if they didn't go far enough in question 3. They want to reconceive growth. I wonder if and how and under what conditions overall sustained growth is possible and good for us. If, in aggregate, it is not (and I have yet to see evidence that the systems mantra of "there are always limits to growth" is false), I want to help find a new and successful way forward. While we have to address the long-term situation, I'm more interested in helping us figure out how to make the transition from growth to sustainability, whether on an organizational, societal, or personal level.
  

Those of you acquainted with some of the literature on growth will realize that a stable system doesn't mean there is no growth. For example, in a business sense, some technologies, products, or services outlive their usefulness, and their companies shrink or perhaps go out of business. Other technologies, products, or services are needed in increasing amounts, and their companies grow. Equilibrium in the aggregate doesn't require equilibrium in the details.

While I'm optimistic we'll figure out a way to deal with this, I still think the issue of growth is an integral part of one of the two major problems we face as a people. From what I read, we may well have exceeded the carrying capacity of the planet. If that be true, then these are important times, for the way we respond can likely have a major effect on the response of the systems in which we live, and the recovery of a system from overshoot can be harsh.

I really would welcome your comments on this.

Two big problems

I've written before about what I see as the two big, high-level problems we face (it's the weekend—I'll let you search for the articles). This week, I plan to publish articles on both. Monday's article on one is mostly written, and I'm beginning to address the second.

Check back next week!

Stocks, flows, and the President's weight

I've noted before the importance of thinking appropriately about stocks and flows. Janice Molloy of Pegasus Communications just wrote "A Weighty Take on Stocks and Flows" for the August 2008 issue of The Systems Thinker, using stocks and flows to communicate the message of a New York Times column by Gail Collins. It's a good tale; if you subscribe to The Systems Thinker, check it out, or check out the original column.

It was fun talking through the implications of these ideas with Janice, creating a few simple models together to clarify Collins' message, and producing the diagrams that Janice used. There is a message hidden in the fun, though: be sure you understand what they really mean when someone says they'll reduce the rate at which something is growing. It may not be all that good a deal.

Prediction, system dynamics, and Future-Fusion

Recently, I made the claim that we're better off focusing on adapting to the present than predicting the future. I've made similar claims in the past, too. I've even given one example in which predictions serve a useful purpose.

That's all a bit simplistic, of course. Even system dynamicists could be said to predict the future in a way: we show behavior over time we feel is more likely to occur (although we may warn people away from point predictions based on a behavior over time graph). In other words, I might suggest that your current policies could produce a boom and bust effect in your business, but I wouldn't want you to draw the conclusion that your business will grow another 172.3% by June 15, 2009 before taking a tumble that afternoon.

Because we all would like to know the future, I've experimented with blending system dynamics and Bayesian analysis to quantify the probability of a particular behavior pattern, for example. Of course, that probability is conditioned on both the historical data and the model being correct, which is a loophole big enough for a good-sized locomotive to run through: models are always incorrect. Still, I think this approach may give more useful insight in certain cases.

Now Kshanti Greene of Stottler Henke Assocates, Inc. has shown me a Bayesian tool they've developed called Future-Fusion, and I've been exploring it a bit. They are using Bayesian networks and the power of groups to get a better handle on what the future holds. Much as Data360 looks at the past, Future-Fusion attempts to look at the future. As of this writing, they've created four test areas which you can explore: the 2008 US presidential election, the Iraq war, corporate strategy, and energy. Try it out: learn how to use the system, see current predictions, and add your own (I think you only have to create a free account if you want to add your own predictions). Perhaps you'll learn something, and perhaps they will, too.

Kshanti has pointed out a recent addition to Future-Fusion that may intrigue some of you: time. They've enhanced their technology to allow limited dynamic execution of a network model, which begins to narrow the gap between Bayesian networks and system dynamics from the Bayesian network side, much as what I've tried has narrowed it from the system dynamics side. To try that out, go to the energy model, select a prediction (e.g., "Reduced SUV sales"), click "view graph," note the numbers, and then click "Next Time Step."

I think this is all still experimental in many ways, but it's a good opportunity to learn a bit about this technology by trying it out on real-life issues. I'll be curious what you discover.

Bittersweet asphalt

No, it's not that I find asphalt bittersweet (I haven't tried tasting it). It's the news that I find bittersweet.

Five and a half years ago, I published Out of Gas: A Systems Perspective on Potential Petroleum-Fuel Depletion. In that column and in the accompanying simulation model, I suggested that delays due to debates over how to allocate shrinking petroleum stocks might hurt our ability to replace energy resources in a timely fashion.

Today, I read Asphalt shortage disrupts road projects. I'm sure you can find other examples, perhaps closer to your home, in which the imbalance in supply and demand of petroleum is leading companies to prioritize one usage over another, which can cause pain for the unfavored group.

Models such as this aren't designed to predict the future, at least in the sense that they tell you that a certain event will happen in a certain year. They're intended to give insights into the likely and potential ramifications of current and proposed policies, both formal and informal, that we've created. They're intended to help us test policies quickly, inexpensively, and at low risk, so that we can be more confident when we implement a policy in our organizations. They do not provide guarantees, but they can provide very useful and sometimes unexpected insights.

In which areas would you like to think more effectively about the effect your current policies could have on your organization's future?

Systemic problems in US healthcare?

Wow!

If you know Tom Peters and his work, you know his focus on WOW!

This is different, though. This is my "Wow" at the intensity of his recent postings, intensity that trumps even his usual high-energy attitude.

Start with Ten Years in the Making!, his take on the state of health and healthcare in the USA today. Go read it the attachment, and then come back (that might be tomorrow; it's 288 slides long!).

I have not double-checked his references, but most of his slides provide references to other's work (and, if you're not familiar with his style, no, they aren't boring bibliographies).

Then check out The Healthcare14: U.S. Healthcare Trauma in 2008 and his tongue-in-cheek Proposed Hospital "Organization Chart."

There are other reports, among them the 1999 Institute of Medicine report To Err is Human: Building A Safer Health System, and there are and have been projects designed to make things better.

While I sense that Tom Peters isn't a big systems fan, it sounds as if a systems approach might help. The IOM and Tom Peters both described patterns of behavior. Patterns are usually stimulated by structures in the organizations we create.

To make a long-term change, we had best find the ways to change the structures appropriately. Focusing on the patterns alone (or, worse, simply the bad events) is literally treating the symptoms, not the disease. Treating the symptoms might make things better in the short term, but we shouldn't be surprised when they return if the disease remains present. That's where the systemic approaches come in: they can help us find the structures at work creating our problems, and they can help us test our theories about proposed solutions. That doesn't always mean the same approach, and it doesn't always mean simulation. It does mean deriving insights from system principles and applying them effectively to solve real-world problems.

If you're in healthcare, do these issues ring true? What do you see?

Genesys can tell you if it's good enough for you

I've written a lot recently about the benefits of working without travel or commuting; I think this will be my last for a while. Genesys Conferencing has a calculator that can tell you how much you save by holding a remote, synchronous meeting instead of traveling to one place to meet. This fits nicely in the sequence of "It's good enough for ..." postings.

Naturally, this calculator is an ad for Genesys; I'll let them own the responsibility for the accuracy of their calculator. I do regularly work with their operators in meetings I moderate, and I will say that I've been pleased with their professionalism and friendliness.

How can I help you make your next meeting more productive, less expensive, and greener?

It's good enough for the whole Chorus

First it was Kate Lister, then it was Phil Woolas, then it was Fast Company, and now it's a whole Chorus. See how a small software company has become totally virtual.

It's good enough for Fast Company

I wasn't planning on continuing this thread, but Fast Company sent me a pertinent link this morning, predicting that "Within five years, technology will obliterate the need for business travel."

While I can conceive of video offering certain benefits, I wouldn't suggest waiting for technological solutions. Perhaps one of the most engaging and effective courses I've ever attended was the all-text-based email AREOL, put on by Bob Dick at Southern Cross University twice a year since 1995 (the year I took it). The key lies in the people and the process, not necessarily the advanced technology.

How can I help you today?

It's good enough for Phil Woolas

Yesterday I wrote about working without travel or commuting. Apparently Phil Woolas, UK Minister of State for the Environment, sees things the same way; he delivered a keynote speech at the Annual Climate Change Summit in Sydney while remaining in London.

What have you been doing to reduce GHG emissions, reduce fuel usage, and thereby improve productivity? I'm curious, and I'd welcome your comments.

By the way, it's my experience that you don't need a lot of technology to make working remotely successful; you just need to think and plan carefully how you'll be effective.

Why go to work today?

Why go, indeed?

Some time ago, I described why I think most of you have had me work remotely over the last eight and a half years and how that has helped you and society. Now Kate Lister makes similar points on The Oil Drum.

Environmental optimism: an example

Glen Hiemstra commented on my blog yesterday, and he also blogged about Al Gore's speech calling for a 10-year program to end the use of carbon-based energy sources for generating electricity.

Al Gore has presented a great example of environmental optimism on a grand scale, and he's done it in a manner I found challenging and uplifting, not depressing and defeatist. You've probably read about it by now, but I encourage you to watch the video.

Environmental optimism

If you've read my blog for a while, you may you wonder: why do I spend so much time talking about environmental issues on a business blog?

The answer is simple: business operates in the environment, and we have no choice in the matter. The environment seems poised to make a few changes right now. That seems fair; it's apparently doing it largely in response to changes we've made. In times of transition, there are usually economic winners and losers. We've seen that building inefficient SUVs is not a winning strategy now (or, presumably, ever again); I want to help you (and me) think about the areas in which we can win.

Which brings me to my main point: optimism. Sometimes I post items that could seem depressing; I think my previous posting fits that description.

There are two steps to change. The first involves becoming motivated, and the second involves doing something. Facing up to the facts, as best we know them, is arguably the first thing we have to do. As we continue to get new data (even as the fundamental message hasn't changed in a while), I think it's important to keep looking at the science so we base our actions on the best insights we have.

I happened to see Great Read! Important Read! in Tom Peters' dispatches from the new world of work. While I haven't read Amanda Ripley's The Unthinkable: Who Survives When Disaster Strikes - and Why, the subject of his post, yet, I think the concept meshes well with my idea that we are the ones who can make a difference. We can do it through business, we can do it personally, and we can do it through our governments. I think it's important to push forward on all three dimensions and not to let difficulties in one of those three areas prevent us from making progress in the remaining ones.

Is that a call to become dour prophets of doom? I sincerely hope not. While I think we have to make changes soon, I think we can and should do it with cheer, energy, and a spirit of optimistic entrepreneurialism. That's one of the things I liked about teaching at Bainbridge Graduate Institute: everyone there had an upbeat, infectious approach to life, to business, to social justice, and to the environment. That's one of the things I like about Bernie DeKoven's Junkyard Sports: he takes trash that no one wants and turns it into the stuff of play. That's one of the things I like about the growing interest in wind power, photovoltaic arrays, and high-efficiency transportation: the business system is responding to a real need. I'll let you have fun and success finding (or, better, creating) more examples.

What do you think?

More gasoline, pain, feedback, consensus

A month ago, I wrote Gasoline, pain, feedback, consensus to highlight a consensus I read between Thomas Friedman and Charles Krauthammer. Now Matt Simmons says much the same thing. Thanks to Glen Hiemstra and his Futurist.com blog for the tip (and see his pointer to a 1979 Jimmy Carter speech on energy).

Alternative energy: not as easy as it sounds?

Five and a half years ago, Pegasus Communications published my Out of Gas: A Systems Perspective on Potential Petroleum-Fuel Depletion. If you try out the downloadable model (see the column for instructions), you will discover my concern that we wouldn't start soon enough or be able to move fast enough to replace petroleum. Such delays could have a significant, perhaps massive, impact on society and on our economies.

Yesterday Forbes published America's Best Places For Alternative Energy and noted SRI's estimates that we need "[r]oughly 4.2 billion solar rooftops, 3 million wind turbines, 2,500 nuclear power plants or 200 Three Gorges Dams" to replace the amount of oil we use annually and that "no single category of renewable energy is growing anywhere near the speed it needs to bear the full brunt of displacing carbon-emitting fossil fuels anytime soon."

So my simple concept model identified a problem that's substantiated by more research at SRI (and by our daily experience, for if alternative energy sources were fully replacing petroleum, would we see overall energy price increases?).

That's part of the message of Is predicting the future really worthwhile?. My simple model didn't predict the future.

• It did identify past patterns of action that could credibly lead to a problem.
• It did use information that's known reasonably well (quantities of petroleum, even admitting that we don't know reserves as well as we'd like, as well as something about the dynamics of petroleum discovery and use) and apply simulation to explore what ramifications those factors might have over time.
  
• It did allow one to try different scenarios to see whether one's conclusions were sensitive to assumptions. For example, does it make a fundamental difference if petroleum reserves are 25% higher than assumed? (No, it just changes the timing of the problem.)
  
• It did provide a test bed for exploring strategies to see which might be more effective.
  

More research (in this case, in the form of the SRI study) substantiates the nature of the problem and helps us understand its magnitude and timing.

What systems are at work in your organization, your business, or your part of the world that might lead to consequences you don't want? How might you test your ideas? What can you change that might lead to better results? How might you test those ideas?

Is predicting the future really worthwhile?

Predicting the future, also called forecasting, is a popular business activity. Some managers want to know what the future holds so they can plan to accommodate it.

Yet I'm reminded by The Oil Drum: Europe's The Fantasy World of the UK Government that our record in forecasting isn't so great.

In that report, the U.K. government published a prediction on May 7, 2008 that gave four oil price scenarios. In the highest of the four, the "high high scenario," the price of oil hits $107 per barrel in 2010 and stabilizes at $150 per barrel by 2015.

As of my writing this, upstreamonline.com shows crude oil spot prices ranging from $138.96 to $152.58.

In 58 days, we've hit the prices they forecast for 7 years in the future.

Instead of predicting the future and then designing a business system to work well if the prediction is true, wouldn't it be better to design a business system that responds appropriately to whatever the future brings?

Isn't that hard? Yes, but so, apparently, is prediction.

That's one of the goals of system dynamics: to give us models which we can test against multiple futures to see if our modeled business systems work as well as we'd like independently of the outside environment. Once we are satisfied with the insights we've gained from modeling, we can implement our real business system with higher confidence it will work as we expect no matter what the future throws at it.

If you'd like to talk about such adaptive business systems, give me a call.

Sneak peak: Information Dynamics I / II

If you are a current University of Washington graduate student or you live within commuting distance of the University of Washington and if you are interested in learning about system dynamics in an academic setting, put IMT 586 and IMT 587 on your calendar for the coming winter and spring quarters.

If you took IMT 586 last year or if you have a solid background in the material of the first half of John Sterman's Business Dynamics, put IMT 587 on your calendar for the coming spring quarter (yes, that's nine months away). We plan to offer it, assuming we have sufficient enrollment.

I'll make a fuller announcement as we get closer. Ask if you have questions, and let me know if you think you're interested: I'm curious and interested.

Essential systems thinking for managers

This could be entitled "Lessons from teaching system dynamics."

As you may recall, I taught a graduate course in system dynamics at the University of Washington last winter, and I'm scheduled to repeat that course next winter.

While I won't write about that class nor about the systems thinking class I'm co-teaching at Bainbridge Graduate Institute, I wanted to note a few things I have come to think may be at the core of "systems thinking," at least in the system dynamics sense, as a result of thinking heavily about this in the process of teaching others:

• It's very important for people to understand that many of our problems are caused by the systems we create, not by externally-imposed actions. Understanding feedback ideas seems central to grokking that concept. Incidentally, grokking that concept should bring a bit of humility to each of us, and it also opens up possibilities: if we create our own problems, then we have some control over fixing those problems. That's a lesson worth remembering.
  
  
• Causal loop diagrams (CLDs) can be a key tool for making sense of the systems that create the problems we see. Better than that, their dialect, influence diagrams, as described by Geoff Coyle and others (for example, see SYSTEM DYNAMICS MODELLING: A PRACTICAL APPROACH), can be even more insightful and can replace stock and flow diagrams.
  
  
• While I'm not a fan of the "systems archetypes" you may have seen in The Fifth Discipline: The Art & Practice of The Learning Organization, there's a lot to be said for understanding what structures and what behavioral patterns are tied together. I don't mean understanding as in textbook knowledge; I mean understanding as in seeing the one and viscerally understanding the presence of the other. Can you look at data (for example, business results), find the pattern that contains the data, and use that to find the structure that likely caused the data? Can you see how to change the structure to make the data be like you wish? If you have the structure in front of you, can you work the other way to estimate the type of behavior you might expect to see? Can you test your theories through simulation or through comparison with real-life situations?
  
  
• Recognizing the difference between stocks and flows is every bit as important as I've written about before. Add to that being able to calculate mentally the changes you'll see in a stock, given the changes you're creating in a flow (mental integration, in other words), and you'll have a better understanding of the impact your actions may or may not have.
  

I came to the conclusion that understanding these ideas well would go a long ways towards helping anyone think more insightfully about tough challenges. Getting there isn't trivial: it seems to require a bit of math and a bit of simulation experience, and having a lot of both seem to help. By themselves, though, math and simulation aren't sufficient; this requires a lot of thinking.

What I'm coming to realize is that having people with these (and other) skills in the management meetings of our companies would be a great help. Instead of just arguing points based on best (unaided) intuition, someone might look at the data and draw some provisional inferences. Someone might think seriously about the type of structure that might have created that data pattern and look for evidence of it in the company and its environment, sketching and discarding diagrams as they go. People might understand the likely effect of interventions based on the current and proposed structure.

Many of you who read this may be able to do all of this already, and that's great! Is it helping you in your work? I hope so; it should.

Others of you may understand when you see others do this but not be able to do it yourself. That's okay; that's why Facilitated Systems is here. If you want to discuss whether your organization might benefit from these ideas, contact me today.

Gasoline, pain, feedback, consensus

Speaking of sustainable energy solutions ...

The price of gasoline is rising, as you've no doubt noticed (if it happens to drop today, it seems likely to return to its upward path tomorrow). People are protesting the high prices for the personal and business pain they cause, and politicians (at least some of them) are floating plans to reduce the pain. Manufacturers and retailers are trying innovative approaches to lightening the load on our household budgets.

While the pain is real, I've noticed a strange consensus recently. Both Thomas Friedman and Charles Krauthammer have advocated for using governmental means to keep gas prices high. In Truth or Consequences, Friedman noted that putting a $4 a gallon floor on gasoline prices could be a great cornerstone of a national energy policy to help us lower consumption, which brings with it all sorts of benefits, including our investment in more efficient infrastructure (different means of transportation, for example) and reduced greenhouse gas emissions. In At $4, Everybody Gets Rational, Krauthammer calls for taxes to keep that same $4 a gallon floor and to increase taxes by $0.50 every six months for the next two years.

What we're seeing are feedback effects. As prices rise, we drive less, reducing demand. As demand drops, prices moderate in an attempt to balance supply and demand. (Over the long haul, that's problematic with a non-renewable resource.) Of course, it's a bit more challenging than that, but that simple balancing loop describes the basic mechanism at work.

In a free-market society, as the one we have crafted, the primary feedback signal we have to adjust behavior is economic. When that feedback kicks in, it causes both pain and changed behavior. It would be nice if you could get changed behavior without the pain, but we don't seem to have mastered that as well.

What do you think we ought to do about this? I wrote a possibly pertinent posting three years ago with almost that for the title. Glenn has an idea on The Oil Drum. You may have your own idea.

As a closing note, I've noted before that exponential growth of physical things always has limits, and likely the price of gasoline or petroleum is subject to the same laws. For one idea how the price of oil and gasoline could evolve, see Ugo Bardi's review of the price of whale oil when it was becoming scarce.

Sustainable Energy Solutions

Recently, I wrote about a non-credit course called Sustainable Energy Solutions to be offered this summer by Bainbridge Graduate Institute, where I'm teaching this spring.

Some of you may have been interested but wished for a bit less expensive course, and BGI seems to have heard you: they've reduced the price of this course to $1,500. If you're interested, hurry and sign up; the class starts soon. Tell Jim Stretch that you read about it here.

Making a big difference

Business Week just published John Hagel and John Seely Brown's Changing the World from the Edge describing how University of California, Berkeley students are making a real difference in the world, this time in issues such as "energy efficiency, Third World poverty and disease, and sustainable housing, among others." By the end, they summarize lessons those of us in business might find useful. I like all three of their three lessons, and I'm looking for ways to apply them, too. If you have suggestions, comment here, or get in touch.

That's related to my recent posting called It's a new world in business education. In all these cases, strong change leadership is again coming out of universities and focused on making the world a better place.

Thanks again to the TP! Wire service for the link.

What is progress?

It's easy to think progress is measured by GDP, trade balances, or the number of things we have; that's what we read and hear about in the news. Yet there's an undercurrent that suggests such views have it all backwards.

The Glaser Progress Foundation has a program area devoted to measuring progress. Go there to see a video or hear an audio of a 1968 speech by Robert Kennedy suggesting that GDP measures all the unimportant things or to research articles they've assembled.

Thanks to Joost Bonsen's Maximizing Progress for the link. Thanks, too, to Cliff Havener and his Meaning : The Secret of Being Alive. I read that years ago, and I'm pretty certain he makes the point that Lord Kelvin was wrong: all the important things—love, peace, faith, art, ...—share the attribute that they can't be measured by numbers. I've looked, though, and can't find the reference; if anyone can provide me the page number, I'd appreciate it.

Food and fuel in the news

DrumBeat: April 25, 2008 offered two particularly interesting links.

First, Time offered How to End the Global Food Shortage, their suggestion on three actions we can take in the short term. I'm not sure I see a long-term solution there, for I sense that global population is still growing exponentially, while their solutions seem focused on taking current food production to a new level, not creating matching exponential growth in the production and distribution of food. Put in systems terms, I sense population is still driven by a reinforcing loop, while the three Time proposals seem driven by goal-seeking loops. The short-term effects do seem beneficial, as long as we don't forget the longer term.

Second, oil financier Matt Simmons has published more presentations. Check out The 21st Century Energy Crisis Has Arrived. Slides 9-10 should not be a surprise to any who took IMT 586 at the University of Washington last winter or who have worked the challenge on pages 212-213 in John Sterman's Business Dynamics: Systems Thinking and Modeling for a Complex World with CD-ROM.

While you're there, also see his Are We Nearing The Peak Of Fossil Fuel Energy? Has Twilight In The Desert Begun? He does offer optimism, but only if we act well and only after some, um, "transitional" times. If anything, I wonder if his estimate of the rate of decline of production is optimistic, for, with the high raw demand for petroleum these days, I suspect we will deplete available reserves at a rather rapid rate.

Followup to Bush and greenhouse gases

One of the claims about working on greenhouse gas emissions is that it costs too much. Business Week tries to put that in perspective.

Fooled by Randomness: some thoughts

I read and wrote about Nassim Taleb's The Black Swan some time ago; now I'm reading his Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets.

I'm struck by the application of his ideas to environmental and ecological issues. It seems as if we're placing most of our societal bets on growth, a bet that has played well for centuries. Given the current news, though, those seem like some of the investment bets Taleb describes as foolhardy. A prudent "investor" (citizen or business person) at this stage in the Earth's development might place most or all money on bets that can't lose much. Betting on the ability of the planet to absorb more growth, on nonrenewable energy sources to remain plentiful, or on technology to increase efficiencies sufficiently yet again seems like a risky bet, given the news of the day (and year and decade).

That's consistent with the precautionary principle; do check out THE YEAR IN IDEAS: A TO Z.; Precautionary Principle from The New York Times.

What do you think?

For more on Taleb's book, see words by Andrew Gelman, Wikipedia, and James Glassman.

Business, Earth Day, and other thoughts

After teaching at my first Bainbridge Graduate Institute Intensive, I am very impressed. The administration, faculty, and student body seem, in person, even more focused on and effective with both words in "sustainable business" than they say they are. I confess that this MBA program truly excites me, and I am glad to play a small part in its work.

That led me to think about business, business practices, and Earth Day tomorrow (there is another Earth Day that passed last month). A bit of looking turned up Nice Guys Don't Finish Last, a Business Week article that indicates that international executives seem to think being green helps them. You can see more in The Economist's report.

A bit more looking turned up Climate Counts, which promises to help us as consumers and as investors, think about which companies have made more strides than others. If you're in business, see their scorecard to think about various dimensions to climate impact. While we might quibble about the weighting of the various dimensions and the focus on climate alone instead of also including usage of nonrenewable resources, social justice, and other issues of corporate social responsibility, we can probably learn from reviewing their measures. Even though I think my overall footprint as a company is quite small, it's prompting me to make an assessment and to think about additional factors that I think might be important.

If you're looking for other thoughts for Earth Day, check out the Donella Meadows Archive at the Sustainability Institute. After being part of the team that did the research and produced the original Club of Rome report, she wrote the weekly Global Citizen, which you can peruse in that archive. There's plenty of food for thought there.

What suggestions and thoughts do you have?

President Bush and greenhouse gases

I haven't been a political blogger, and I'm not about to start now. Yet the news of the past few days does offer ways to illustrate systems concepts I've mentioned before, and so I thought I'd point out what I hope is obvious to all here.

For but one example, take US President Bush's goal of having greenhouse gas (GHG) emissions stop growing by 2025, which is stirring up comment world-wide.

In system dynamics terms, GHG emissions (largely CO₂) are a flow, and the amount of CO₂ in the atmosphere is a stock. If you recall what I've written before on stocks and flows, you'll see that stopping the increase of a flow does not mean that the stock will decrease; it simply means that it will increase less rapidly.

In other words, even if we do meet this goal, things may well continue to get worse well after 2025, but they will at least get worse less rapidly after then.

I want to show you a little model that demonstrates that behavior, but, to publish it here, I'd like to get the numbers at least close to right, and that would take a bit of research time I don't have tonight. Let me try an analogy, instead; those of you who studied and remember the calculus can probably make a more elegant argument, and those who do system dynamics models can create one on your own in a few minutes (if you have the needed parameters, let me know, or post a pointer to your model).

In the real world, we are emitting CO₂ into the atmosphere by breathing, burning fossil fuels, and the like. That stock of CO₂ in the atmosphere is growing and threatening climate havoc.

Some of that CO₂ is taken out of the atmosphere each year through the action of photosynthesis and perhaps other mechanisms.

According to the science I read, we have too much CO₂ in the atmosphere at present, and our global CO₂ emissions per year, already above what the environment can naturally purge, are increasing. If that weren't the case, there would be little reason for President Bush's call to action.

Let's look at an analogous situation. For example, let's say you have a bathtub that's three-fourths full of water. The drain is open, but it's partially clogged, and so it's draining slowly.

In addition, the faucet is turned on, putting more water in the tub. It so happens that the water is currently coming into the tub faster than the partially-stopped drain can take it out, so the water level is rising, causing fears for the well-being of the bathroom floor.

The person controlling the faucet is opening the faucet as we speak, letting water come into the tub at an ever faster rate. That person, realizing the risk to the floor, promises to stop opening the faucet anymore in about 15 minutes.

What do you think will happen to the floor?

Even with the rough data I supplied, I hope you can see that the water will rise increasingly rapidly for the next 15 minutes. If the person takes their hand off the faucet in 15 minutes, the water will continue to rise until it overflows the tub (assuming it doesn't overflow sooner). The only way to save the floor is to reduce the flow of water from the faucet to below the flow of water out of the drain before the tub overflows. Even if they started reducing the flow of water out of the faucet now, the water in the tub would still rise until the inflow was less than the outflow.

Of course, this is a silly little example; the real world of GHG emissions is much more complex. Yet the general principle of stocks and flows holds: as long as the inflow exceeds the outflow, the stock will rise.

I'm not about to use this short, informal essay to argue for or against specific GHG or climate proposals or to try to balance climate stability against economic stability. I am suggesting that we all remember the lesson of stocks and flows when we are thinking about or evaluating policies such as these.

PS: Thanks to colleague Wayne Wakeland for, in a totally different situation, reminding me of the effectiveness of simple bathtub models (and I hope it worked here!).

Grow or die

The title is a rough quotation from an interview I read by a CEO recently. It doesn't matter who it was; it's a common business notion, I sense.

I understand the sentiment, really I do. There is a real fear that, if we don't grow, we'll be overtaken by those who do grow. Or that we'll become stagnant and stale.

Yet I'm mindful that, if we all grow, we'll surely die (or at least suffer), too. Read Limits to Growth, if you're uncertain about my statement. Note that "limits to growth" in that book is not a statement of an environmentalist's hope; it's a statement of fact. We will face limits to growth. We can choose the nature of those limits (or at least we have had the chance), but stop growing we will. You can't exceed the carrying capacity of an environment forever.

So, if it's true that we all (or most all) want to grow (our companies, our houses, ...), and if it's true that we will face (and are already facing) real limits to that growth, what do we do?

I've written about growth a number of times, but I admit that I don't have all or even many of the answers yet. Perhaps I'll find out more in the next few months, for I'm co-teaching a systems thinking course at Bainbridge Graduate Institute.

If you're not familiar with BGI yet, their vision is "To infuse environmentally and socially responsible business innovation into general business practice by transforming business education," and they've got a good reputation in this area.

As I did when I taught system dynamics at the University of Washington, I suspect I'll learn a lot here, this time with a distinct focus on sustainability and business. I'm really looking forward to this experience. (And, as I did last time, I will refrain from telling you anything that goes on in class unless I have explicit permission, but I may tell you a bit about how I grew.)

System dynamics in practice: lessons learned

Drew Jones, Don Seville, and Dana Meadows of the Sustainability Institute wrote Resource Sustainability In Commodity Systems: The Sawmill Industry In The Northern Forest. That provides a good example of a way to use system dynamics models (it's of course not the only way).

I like that paper for several reasons. The model seemed good (at least from the explanation; I haven't explored the model yet), and the explanation of the model and its implications seemed good. What may be especially interesting to some is that they spent the last third of the paper talking about what they learned about the human side of the equation: how people responded to their work, and what they learned from that. The top of page 26 seems noteworthy, although you'll probably have to read the preceding 25 pages to make good sense of it.

Focusing on the symptom or the cure?

I recently read Jay Forrester's "Churches at the Transition Between Growth and World Equilibrium," a paper prepared for the National Council of Churches and published as part of Toward Global Equilibrium: Collected Papers, ed. Meadows and Meadows and published in 1973 (also available from Pegasus Communications).

Forrester emphasized two points that may be worthwhile today to some of you reading this:

• When fundamental changes happen in the environment in which we operate, old rules of thumb likely no longer appply.
  
• Trying to fix problems by focusing on symptoms is highly risky, for, even in static times, our intuitions don't always work as well as we need. In times of transition and turbulence, it's especially important to ensure one understands the dynamic causes of the problem being faced before engaging in actions that could be counterproductive.
  

Forrester was a bit more direct than I was in my paraphrase. "One should never attempt to find a solution without first establishing the dynamic causes," he wrote, and system dynamics was his tool of choice for testing whether one had found the underlying causes or not.

Today we face increasing energy costs, increasing population density, increasing effects on climate and on the inhabitants of the Earth from the by-products of our industrial and private activity, fundamental shifts in the distribution of production and wealth, a scarcity of resources that were abundant in the past, and the fall-out from overextended financial markets. No matter your type of organization, the complexity of these changes taxes our understanding.

In a time of such changes, how do you make sense of the challenges your organization faces? How do you determine which actions to take to achieve the sustainable successes you want?

If you'd like to discuss ways in which you might make more sense of those issues, ways you might understand the likely causes of the dynamics you face, and ways you might test your proposed actions faster and at less risk than by just trying them, get in touch. Perhaps I can be of help as you seek to fix problems and not just reduce symptoms. Of course, there's no charge or obligation from such an initial discussion.

How It All Ends and John Sterman

Some time ago, I posted a note linking to a John Sterman comment about global climate change. This morning, thanks to a randomly found posting, I discovered How It All Ends, a video that says something quite similar.

Greg Craven, the creator of the video, has put together a monster series on risk management, our role in the world, and global climate change. The first video is not quite 10 minutes long, and it presents the basic idea. It leads to an index video, which presents a few more ideas and leads to the menu video. While those last two seem like they might be boring and useless, you might find they add more value and are thus worth watching (perhaps the index more than the menu), even if you eventually find Wondering Mind 42, his Web site that has the list with links to each of the videos.

So at least go watch the first and perhaps the second video now, and see what you think. You might discover it's worth watching more. You might learn new ways of thinking ... and acting. Learning new things is almost always good, right?

And don't forget to read John Sterman's comment, if you haven't already.

More on LTG

I'll try to stop writing about LTG for a bit, but, before I do, I did find one other interesting paper that some of you might want to read. Matthew Simmons of Simmons & Company International wrote Revisiting The Limits to Growth: Could The Club of Rome Have Been Correct, After All?" back in October 2000. It appears to be a very readable, data-rich analysis of the changes in key parts of the world by someone who has been active in the energy business for decades. Check it out.

Simmons is a prolific writer; he has published a series of speeches and papers online (check the archives and the Oldies but Goodies, too). I'll have to come back and read more later.

Postscript: While I should be doing other things, I'm reading more of his articles. I encourage you to read his PEAK OIL: Is It Real? When Might It Occur? from February 25, 2008. While you need to start at the beginning to get context, check out his recommendations starting on slide 48:

Only viable solution that can work now:

• The solution: TRAVEL LESS
  
  
  
  • Less long distance commuting
    
  • Grow foods at home
    
  • Make goods locally
    
  
  

What do you think?

Cassandra's curse and LTG

Almost two years ago, I posted about Limits to Growth: The 30-Year Update. Whether you saw that posting or not, I suspect you know Limits to Growth, often referred to by its initials as LTG.

Now Ugo Bardi has written Cassandra's curse: how "The Limits to Growth" was demonized in The Oil Drum: Europe. It's his view how LTG started to stimulate true dialog about a major challenge for the planet and how it then became "everyone's laughing stock" (well, perhaps not everyone's).

That's changing. As Bargi notes,

Climate studies have also brought back the limits of resources to attention; in this case intended as the limited capability of the atmosphere to absorb the products of human activities. In this field, the LTG study can be seen as having taken the right approach from the beginning; modeling for the first time the interaction of the environment with the human industrial and agricultural system.

If you've not read LTG, I encourage you to read it now. If you'd like, you can buy Limits to Growth: The 30-Year Update online, or you can find it in your favorite library (you can change the country or specify the location more precisely).

System dynamics, black swans, and the management of business

I'm currently reading Nassim Nicholas Taleb's The Black Swan: The Impact of the Highly Improbable. While I intend to tell you more of what I think when I'm finished, I have an early impression, based on stories such as what he calls "Hume's problem" (or the turkey problem). That's a problem in which everything seems to be getting better and better, only to change direction suddenly and drastically for the worse. In his example, the turkey sees life as a daily succession of friendly humans offering food, only to have it cut short in a manner seemingly quite out of character for life as the turkey has perceived it. (As Taleb points out, it all makes eminent sense to the butcher.)

I think that's part of the reason for system dynamics as yet another tool for thinking and working. As Geoff Coyle points out in his System Dynamics Modelling: A Practical Approach, top management is concerned about things such as the consequences of actions, the likely future, and robustness against uncertainty (p. 15). One of the basic parts of the system dynamics approach is to challenge preconceived notions of the extent of the system causing the current situation: are we looking over a broad enough time span, are we including enough of the actors and actions, and are we paying attention to feedback effects (what Taleb calls recursive effects on p. xxii), where something we do today might come back and affect the situation we face tomorrow?

While there are no guarantees, that unfortunate turkey, had she had good training in system dynamics (or a competent system dynamicist at her side), might have been inspired to look at life over a 5-10 year time span, not just the few months she had experienced. That might have surfaced the fate that led to her demise as part of a regular pattern (albeit one that occurred rarely compared to her lifespan). Had she looked not only at the friendly human feeding her and the other turkeys eating with her, she might have noticed the butcher looking eagerly over the fence from time to time and asked about his role in her life. Had she realized the implications of those observations, she might have decided not to become quite so friendly with her "caretaker," she might have decided not to eat nearly as much (if she were scrawny, might her fate have been different?), and she might even have encouraged the other turkeys to join her in an escape attempt.

Now I don't think that the use of system dynamics conveys infallibility; in fact, that's why I'm reading Taleb's work, to figure out more places my insights may be fallible so that I can make them more robust.

Taleb advocates tinkering as a way to make progress; I see system dynamics as a way to tinker faster and think more effectively in support of your (and my) goal of more effective action.

While my comments may be out of the main focus of Taleb's thesis (system dynamicists tend to focus on the deterministic, not the random, even as they seek to help you be able to respond better in the presence of the random), I don't yet see them in contradiction. I offer them to you in the hopes they are of use to you. Now it's my (and your) task to try to disconfirm them; the longer we can't, the greater the likelihood there's something worth attending to!

If you want to tinker faster with the situation you find yourself in but don't want to risk your business each time you tinker, let's talk.

Thanks to Andrew Gelman for his posts that led me to Taleb's work.

Looking from the outside in...in English

Realizing that the majority of those reading this blog may not read German, I put together a quick summary of Henrik Müller's arguments to which I pointed last Friday.

In his most recent article, he claims that, in a somewhat healthy economy, we have three feedback loops that would stabilize our economy and dampen out our current problems:

• People and the government would spend more to stabilize consumption.
  
  
• Government would borrow more in order to support its temporarily increased spending.
  
  
• The Fed would lower rates to encourage consumption (and, presumably, investment).

He claims all three are at their limits here. He quotes an OECD number that says our savings rate is -1.0%, and housing values are dropping, so we have nothing left to spend.

He says our Federal budget deficit is only 3% of the GDP, and our debt, at 60% of the GDP, is 60% beneath the norm in Europe, so we could increase the debt to try to pull us out. Unfortunately, because we save so little, the only people who can buy that debt are foreigners.

Finally, while the Fed has room to lower the rate, he sees banks as ready to absorb any excess cash rather than loan it out, and he worries about inflationary pressures that may present, thanks in part to an ever-weakening dollar.

In the current political scene, he sees candidates pushing protectionist agendas and hope, while he sees our real hope as lying in global product and capital markets. In fact, the only good news he sees is that the devalued dollar has increased exports and that foreign governments seem ready to invest huge sums in US banks, and he's worried that we don't see that for the good news it is.

What do you think? If you read German (especially if you read it natively), what important points do you think I missed from the two articles?

Looking from the outside in...

One of the things that doing enough system dynamics work teaches one is the benefit of perspective. Sometimes when you're in the middle of something, it's hard to see the forest for the trees. Standing back a ways and, just for a moment, trying to drop any emotions that are tied up in one's current situation can give one better insights.

That's what system dynamics modeling can often do: change a situation in which you're an intimate part to a situation you and your colleagues can look at with a bit of perspective. It also gives you the ability to test ideas on the model before you test them on the real situation.

When we can't get that perspective ourselves, either because of time limitations or because we can't figure out how to do it successfully, reading or hearing what others say about us can sometimes provide us similar perspective. Sure, those outsiders may not understand our situation as well as we do, at least in the details, but they may help us find a better perspective into which to place our more detailed understanding.

If you live and work in the USA, you've no doubt read much about our economic situation recently. I've suggested before that it's healthy to see how others see us. Recently Henrik Müller of the German business magazine manager magazin posted an article entitled Amerika steht mit dem Rücken zur Wand ("America stands with its back to the wall"), a follow-up to an earlier and more data-filled Nach der Orgie ("After the Orgy"). If you read German, or if Google Language Tools suffices, I encourage you to read these articles. He may not be correct in all his assessments, but he may give a better perspective than the headlines in the nightly news about sub-prime mortgages, foreclosures, and other problems. Certainly his earlier article does something I like to see: he gives graphs of at least some key data over a five-decade span, which is more useful for seeing patterns and gaining perspective than merely seeing what has happened this century.

How do your mental models compare with his? What are you doing in your company to adapt? What should you be doing?

A problem in policy or implementation?

There's a discussion about different approaches to solving organizational problems on a mailing list to which I belong. I posted the following follow-up:

Problems in policy implementation may be due to problems in policy design.

(In this context, a policy is a set of rules or guidelines by which we make decisions. )

While it's taken totally out of context here, I think it's very consistent with Deming's ideas, with the lesson that problems in the user manual for a product may really be a problem with the design of a product, with what I've learned as a manager leading change, and with what I've observed as a consultant: if you get the "system" designed well, the implementation may well become significantly more straightforward.

So if you're not getting the results you want out of your organization and if you're tempted to think the problem lies in the people implementing your policies, think again, just to be sure. It's possible that the problem lies in your policies.

That's actually good news, for it means the problem lies in an area you really do control, one where you really can make meaningful, effective changes.

What do you think?

IMT 586: Information Dynamics I

If you're in the Puget Sound area and have been thinking about enrolling in IMT 586 (Information Dynamics I, called system dynamics by most of the rest of the world) at the University of Washington, now's the time; the quarter starts next week.

For more on the course, see my two prior announcements.

Top postings of 2007

In the last 12 months (to be precise, from last December 28, the day after the Top postings of 2006 entry through December 26, 2007), you have chosen ten top postings on Making Sense With Facilitated Systems as ranked by unique pageviews in Google Analytics.

As I noted last year, there are potential statistical problems with this list. Those who read my blog every day using the main URL don't get counted; both last year's and this year's tallies were made from those who landed on specific URLs as reported by Google Analytics (but excluding visits I may have made). That may be okay; those who linked to specific pages may have cared more about them. Recent entries have a more difficult hurdle, as they haven't been around as long to be viewed. The dates don't quite line up with the calendar year, although I suspect that makes little difference in the results. If you know of a better way, let me know.

10. For some time now, I've been using an open source simulator for my system dynamics work because it seems to help me think more effectively. That doesn't mean I've given up on commercial tools; I still use iThink for creating interactive environments, and I will be teaching IMT 586 at the University of Washington using Vensim PLE (and I may be using it in professional applications, as well). Last April, I combined my interest in the arts with my interest in this new approach to system dynamics in a public article about marketing program for symphony orchestras. You selected TAFTO 2007, the pointer to that article, as number ten on the list.
    



9. I've written several articles about data and numbers. Making more sense with numbers part 3 offered an easy process to plot data you receive in email or reports.
   



8. The words we use can be vitally important in helping us think productively about key business, organizational, and social challenges. In A systems language for business, number eight on the list, I described one team's evolution towards a better language for discussing business issues, thanks to a course they took from me in system dynamics modeling and simulation.
   



7. Good data helps us ground our thinking in reality. Still more on data, a pointer to several online sources of data, captured the number seven spot.
   



6. Growth can create problems (witness any of the bubbles that have occurred over history), but where are good examples of successful companies that intentionally don't grow? Number four on the list is Small Giants: the American Mittelstand?, pointing to a book that answers that question.
   



5. Sometimes old technology still has utility; sometimes it still attracts interest. At number five, Technology comes full circle, a description of my continuing use of a slide rule in my work, certainly fits that description. For those who are interested, it points to a source for new slide rules.
   



4. When I first started work as an engineer, PERT charts were done using mainframe computers or hand-drawn charts. Today, project management has become a profession with a certification process, and automated tools with graphical user interfaces have long since replaced tables of numbers and dates. Your sixth-most-popular entry was Critical chains: a decade later, my revisiting of Eliyahu Goldratt's critical chain theory that linked to Tom von Alten's revisiting of his views on the approach.
   



3. Productivity is obviously important to you. Your third most popular posting of the year was a surprise to me: If you can say it, it's done, an entry about the array programming language J.
   



2. Barry Richmond has a deserved place as an educator and thinker on system dynamics and systems thinking. I posted a link to an article he wrote about systems thinking and followed up with "Scientific thinking" the modern way, a differing view on the application of modern scientific thinking in system dynamics. That was your second favorite posting from 2007.
   



1. The 2007 posting you viewed the most was the series Making musical sense by email, showcasing a conversation between music critic, composer, author, professor, and consultant Greg Sandow and me that used a system dynamics model to explore the aging of audiences for symphony orchestra concerts in the USA. Now I'm curious: was its popularity because of the topic (music), the approach (a somewhat novel approach to using system dynamics), or the fact it was a real conversation between two people? Let me know.
   

All of those postings were made in 2007. It wouldn't be fair to finish this list without noting that some postings from prior years did rank higher than some of these. Here's the all-time top ten list of postings from Making Sense With Facilitated Systems as measured by your viewings in the last twelve months:

15. TAFTO 2007 (2007)



14. Making more sense with numbers part 3 (2007)
    



13. A systems language for business (2007)
    



12. Still more on data (2007)
    



11. Small Giants: the American Mittelstand? (2007)
    



10. Technology comes full circle (2007)
    



9. System Dynamics for Cheapskates (November 2006)
   



8. Critical chains: a decade later (2007)
   



7. If you can say it, it's done (2007)
   



6. "Scientific thinking" the modern way (2007)
   



5. Making musical sense by email (2007)
   



4. System dynamics with MCSim (November 2006)
   



3. In praise of the lazy employee (April 2005)
   



2. System dynamics and program evaluation (June 2005)
   



1. Making sense with numbers (November 2006)
   

That list includes the top ten postings written in 2007 plus the five entries written in prior years that were at least as popular as the top ten 2007 postings.

As 2007 draws to a close, I want to thank you who read Making Sense With Facilitated Systems and to invite you to continue with me in 2008. If you have suggestions or feedback for this blog, contact me.

I would be honored to be of service to you or your organization in 2008. If you're trying to make sense of tough business or organizational challenges, curious how I might be able to help, or just want to talk about some of the issues you face or that I write about, get in touch.

System dynamics course

Have you heard of system dynamics here or in your reading elsewhere? Would you like to learn more, including how to create computer simulation models to make sense of some of the challenges and puzzles you face, be they at work or in the news?

The University of Washington Information School is offering IMT 586, a first course in system dynamics, in the winter quarter. Yes, I'll be teaching it. You can learn more about it, including tips on how to register, in my earlier posting called Information Dynamics: IMT 586. My instructor class description lists the three goals I have for this course. For anyone concerned about the level of mathematics required in this course, that page also points to a brief description by the author of our text describing the level of mathematics needed to do this work.

I look forward to meeting some of you in that class!

The voice of a child ...

I write here about the environment from time to time, for I think there is a significant likelihood that we will face important transitions in our lifetimes or the lifetimes of our offspring that will impact us in multiple ways: personally, in the way we live, and professionally, in the way we produce what we need to live and earn what we need to acquire those things we need to live. (If TIME is right, we may not have to wait that long for those transitions.)

Presentation Zen posted You can learn a lot from "a child", a speech by Severn Cullis-Suzuki at the 1992 Earth Summit in Rio De Janeiro. It touched on the big issues I perceive we face: figuring out how to make life sustainable on this planet, and figuring out how to live together. Watch it.

I also write about presentation skills from time to time. As Presentation Zen reports, Al Gore called this "the best speech at Rio."

A rash generalization

Friend and colleague Jay Forrest and I talk about what I find to be interesting ideas from time to time. Stimulated by an idea he once told me, I've assembled this rash generalization:

• Income (living wages, one hopes) gets made off the production that's both necessary to support the status quo and possible because of the status quo.
  
• Riches can be made off the transitions from one status quo to the other.
  
• Some disasters are made off the mistaking of a transition (from point X to point Y) for a never-ending trend (from point X ever upwards at a constant CAGR) and the effort we expend to try to make it so even after we've passed that situation's limits to growth.
• Other disasters are made when we envy the growth others exhibit and try to force our steady-state situation to match their growth.
• Disasters may take time to materialize. Part of the art of business is recognizing turning points and responding appropriately.

What do you think? Where is your business?

Leadership and systems thinking

Colonel George E. Reed, director of command and leadership studies at the United States Army Way College in Carlisle, Pennsylvania, has some interesting things to say about leadership and systems thinking in his article by that name.

His ideas seem related to many of my posts on systems thinking as well as my post on the lazy employee.

Thanks to the Curious Cat Management Improvement Blog and the Ackoff Center Weblog for the pointers.

Information Dynamics: IMT 586

Have you ever wondered ...

• what causes some ideas, products, and companies to become fads that peak and die, while others have staying power?
  
  
• why there are business cycles?
  
  
• what causes some diseases to become epidemics and others to subside with little effect?
  
  
• why real change often takes so long?
  
  
• the role information plays in the answer to each of these questions?
  

Would you like to learn to answer these and other such questions
yourself? Are you a student at the University of Washington, or do you live within commuting distance?

Then sign up for the Information School's IMT 586, Information Dynamics I, in the Winter Quarter 2008. I look forward to seeing some of you there.

Focus on the patterns, not the events

If you've ever seen the video that accompanies The Beer Game, there's something eerily familiar in the news about real estate in the USA. (Disclaimer: The video I saw was a VHS tape with a PBS segment on a previous boom and bust cycle in real estate. I can't promise the current DVD contains the same material.) Despite 50 years of knowing that the principles of feedback control theory apply to human and organizational systems, we still create systems with poor information feedback that get us into the ecstasy of boom times followed by the despair of busts.

What does this mean to us, assuming we're not directly impacted by current real estate woes? Where do you see the potential for boom and bust in your world? How do you know? How do you test your hunches?

I can't tell you when you'll experience a bust, but I can help you discover how you can design a business or organizational system that is less likely to experience such boom and bust cycles.

Incidentally, if you'd like to play The Beer Game but don't think you have an opportunity, check out the online version.

Finding a consultant - remotely

In less than a month, Facilitated Systems will have been in business for eight years. I've worked with people in Asia-Pacific, Europe, and the Americas, and yet I've rarely seen a client, for I work mostly from my office.

In today's world, that has distinct advantages. For those of you not used to working remotely with a consultant, I'll list a few:

Responsiveness

If I came to your site to work, I'd likely save up tasks until I had half a day, a full day, or perhaps several days of work at once (depending upon how far away you are), because it's more economical. That's a delay for you.

If I work remotely, you can get my attention in the size chunks you need: minutes, hours, days, weeks, or months. The delay from asking a question to getting an answer drops; if I'm available when you call, you'll start getting help immediately. If you do have to wait, the wait will likely be shorter.

Speed

You can get my help now, without waiting for me to fly, drive, or take a train. If I'm working on someone else's tasks, you need to wait for me to finish those. That's where responsiveness kicks in: if it's appropriate, you may well get some of my time starting today, rather than having to wait until I have full days available.

Lean

If I'm traveling, I'm not working for you. Sure, I try to work on planes when I can, but there is much to the travel experience that represents pure muda. Moving me to you is the essence of transportation and waiting waste.

Cost

If there's no travel, you don't pay for travel. Simple.

Carbon friendly

If I'm not traveling, I'm not generating as much CO₂.

Petroleum friendly

If I'm not traveling, I'm using less petroleum.

Congestion friendly

If I'm not traveling, I don't add to traffic congestion.

Resources

If you need a team, assembling a remote, distributed team from my contacts world-wide to help you brings all these benefits in spades.

How did I discover this? You folks taught me. When I started out, I expected to spend significant time in a car or on a plane, even as I expected to do some of my work remotely using the phone, email, and other online tools. With rare exceptions, you who hired me were quite happy to have me sit here and work there. As times have changed over the last eight years, your insights seem wisely prescient.

Some tasks do require a consultant at your site. I've done that, I will do it again, and I do enjoy working together with you in person. So call if you think that's what you need.

I have also discovered that it's possible to share ideas, build trust, work on problems, and make a joint contribution without being there in person. If that's what you seek, call me, too.

Which serves you best?

A manager's job

Here's a philosophical question for you on a Friday. What is a manager's job?

Is it to lead a group? To direct people's actions? To manage and control the progress of an organization? To make decisions? To solve problems? To follow directions from above?

While all of those may fit in the typical manager's day, I think the foremost responsibility of a manager is to create and manage human and organizational systems that will get the correct things done.

As managers, we have the responsibility to get things done through our organizations (as a one-person company, I'm counting myself as a "manager without portfolio"). If we believe the mantra that events are part of patterns and patterns are caused by structure, then our task is to create the structures that will lead to the sort of patterns and events we seek.

If we focus on individual problems and decisions, we're focusing on events. That will lead us into the perpetual task of trying to address more and more events, and we risk being overwhelmed. We're perpetually pushing against the tendencies of the system that's there.

If we make it our business to create and maintain an organizational system that gets the right work done, we create a "machine" (a system) that gets the work done for us with less effort and fewer problems. That's how I helped an organization reduce its budget variance by 95%, and that's part of what I meant by praising "lazy employees." While you're working on this system, remember that it has business, technical, and people dimensions, which all demand attention!

So if you are a manager, your real role is that of a (human and organizational) systems engineer.

What he said

See Gill South's report about Systems Thinking, System Dynamics: Managing Change and Complexity by Kambiz E. Maani and Robert Y. Cavana.

The advice?

• Take the time to think.
  
• Patterns, not individual datapoints (problems), are key.
  
• If you want to change an event (fix a problem), you have to change the process (structure) that created the pattern of which the event is a part.
  

As some might say, it's all about context. Others might suggest it's about getting leverage.

If you're facing a challenge in your organization, are you looking at an individual event, or is there a pattern? What's the structure (process) that created that pattern? What can you do to change the structure so that the pattern changes in a way you want? Would you like to talk about it?

Structure influences behavior

That's part of a message I try to convey: structures tend to create patterns, and events are usually part of patterns. If you have to fix (change, eliminate) an event, don't focus on the event. Rather, see if the event is part of a pattern, and focus on the structures that fix that pattern. Then you'll see the events become fixed.

That's the reason I apply system dynamics to organizational problems: it helps us find the pertinent structure.

In It's the invisible structures that get you, Andrew Taylor says it eloquently.

Jane Jacobs

Some time ago, I wrote briefly about Jane Jacobs and her The Death and Life of Great American Cities. I found it in a list of recommendations from Andrew Gelman, which makes me want to go back and review the other books on his list that I haven't read.

I liked three things in particular about this book:

• her lessons about cities
  
• her detailed and interesting descriptions of her observations
  
• her very early use of ideas of complex adaptive systems
  

The first was simple: I had never really thought about the functions sidewalks and side streets play, and I had never thought about how a mix of uses during the day plays into keeping a city safe. I had not understood why some recommendations for urban renewal seemed to work so poorly nor what might be done about it. She made all that clear. I'll trust what she says, for I don't live in a city environment to be able to experience it first-hand.

The second was more important to me. Her book was, in a way, one long series of low-level observations, coupled closely with reasonable and reasoned inferences she would draw from those observations. She never got far away from the observations, so it seemed easy to verify her thinking. Using the ladder of abstraction metaphor, she seemed to stay on the lower rungs, and that made her thinking and her arguments more powerful.

The third surprised me. I didn't really expect an early 1960s book about city planning to dive into complexity theory, but she did it at the end of the book, after building up a remarkable story, and she did it in a way that was quite approachable. If you're curious, you can see an excerpt from "The kind of problem a city is," the last chapter of her book, at Katarxis No. 3.

If I took away lessons from this experience, they would include:

• Observe.
  
• Attend to outliers as well as central tendencies; attend to diversity as well as averages.
  
• Make sure inferences are based on observations, and make the chain to the observations as short and as transparent as reasonable.
  
• Explore new ideas and new theories, for some of them make help make better sense of observations. This admittedly may cause tension with the previous lesson.
  
• Be interesting, which comes in large measure from being interested.
  

I like to give links to other sources you can explore, but there are so many options in this case. P.J. Tayor published Jane Jacobs (1916-2006): An Appreciation in Environment and Planning A. Jacobs gave credit to Warren Weaver in her work on complexity; you can read the part of his work she references in The Rockefeller Annual Report, 1958 (start on page 23 of the PDF). I recommend this highly. If you liked Weaver's article and want to read more about making sense of complex situations in the social sciences, F.A. von Hayek's Nobel Memorial Lecture The Pretence of Knowledge might well belong on your reading list.

But, more than anything, read Jacob's The Death and Life of Great American Cities. It's worth it.

Is business getting worse?

Bloomberg says "CEOs See `No Clear Signs' of Crisis as Woes Intensify." Are things really getting worse, even as people put smiles on their faces, as that article seems to indicate?

We obviously won't know for a while. Even if things get worse for some companies, others will likely do okay, and some will thrive (or, if things go well, others will likely do okay, and some will suffer).

To a large degree, the key is being good at responding to what happens, not simply what happens. We get good by being lucky, by thinking clearly, or by having been in this situation before and having learned (or by some combination of those). While I have no help for you in the luck category, there are myriad approaches to thinking clearly, and I've tried to touch on a few in Making Sense With Facilitated Systems.

You might say that there's no way to experience the future before you get there (the third alternative). As Dietrich Dörner and Harald Schaub point out, that's not necessarily the case. Simulation (system dynamics, usually) is a way to explore challenges we might face in the future and to learn which strategies are likely to be more successful.

How are you preparing for the challenges you might face? If you'd like to talk about some of the possibilities, drop me a line.

Coping with Chaos: Seven Simple Tools

While I'm recommending friends and colleagues, I want to point you to Glenda Eoyang's appearance in the Virtual Chautauqua discussing her book, Coping with Chaos: Seven Simple Tools (now available as an ebook and as a webinar). Glenda, executive director of the Human Systems Dynamics Institute, does very good work in making the tools of complex adaptive systems usable in practical situations, and this is a great opportunity to chat with her from now through the end of July for free. Drop by!

Systems thinking and art

Not long ago, The Diagram published one of my system dynamics diagrams because they were attracted by its design ("But is it art?"). Recently I discovered a quotation I wanted to share with you, for I think it conveys something important about about organizational or societal simulation and modeling as well as about art.

Suggestion—the part standing for the whole—is a principal means by which art communicates; this is why art often tells us so much with such economy.

Jane Jacobs, The Death and Life of Great American Cities, p. 377.

That's what system dynamics in particular and systems thinking in general is all about: economy in expressing the essence of a problem to foster economy in solving the problem and economy in creating deeper insights to be able to solve the next, similar problem.

I like that quotation.

I like the book, too; I'll probably write more about it soon.

There's another problem, too

In my last two postings, I've written about what I think is a very important issue we face as individuals, as businesses, and as a society. I think there's another issue that goes hand-in-hand with that issue: how we deal with tough, stressful problems, how we deal with conflict, and how we deal with perceived inequities. In almost any significant situation, we'll have differences of opinion, some small, some very large. (If we didn't, we should perhaps wonder if we're considering all the evidence.) How we deal with those differences can make all the difference as to what sort of outcomes we achieve.

No matter whether we're talking about differences between individuals, differences between groups in our companies or organizations, differences between factions involved in our local or national governments, or differences between nations, we have various approaches. Some approaches are violent; some are not. Some seem to lead to good resolutions; others do not. Some seem coercive, at least to some involved in those deliberations; others do not. Some seem to solve the problem today while creating new problems for the future; others don't.

If we can't figure out how to act effectively in such situations, I fear we'll have increasingly difficult times as stress mounts from climate change, from energy shortages, from perceived inequities (whether between individuals, groups, or nations), or simply from the challenges of doing business in competitive markets.

There are many ways to make communications in such situations more productive. As I've advocated for the use of multiple approaches (triangulation) in making sense of problems, I will say that I don't think any one approach has ability to save all deliberations about differences. Yet I have found the work of Chris Argyis, work he calls action science, to be impressively powerful in helping groups to hold productive discussions, to make breakthroughs in their organizations' abilities to get work done, and, as a nice side benefit, to help people feel good about working in their groups, not because they get their way, but because they get heard. It's based on three premises about productive decision-making in times of conflict and stress:

• Free and open decision making
  
• Testable and tested data
  
• Mutual commitment
  

The first, among other things, means I can't force you to use this approach. I can at best model the behavior I believe in and that I would like you to adopt; I have to give you the right to decide whether you want to follow suit.

The second means that we are willing to test data about all our important assumptions, not just the ones about quantitative data. Perhaps I (think I) know you'll never accept a certain proposal. If I'm following my principles, I'll figure out a effective way to test that assumption on my part (perhaps as simple as asking); otherwise, I'm unilaterally taking one possible solution off the table without us having the ability to talk about it.

While these are all hard in practice, while they require great attention to one's self, and while they sometimes require great courage, the third sometimes seems the hardest. Perhaps you and I disagree about a situation. Perhaps you've made your best case, and I see important issues I perceive as favorable to your position that you didn't bring up. If I'm committed to the first two premises of making free and open decisions with tested and testable data, then I'm committed to bringing up those issues, even if I perceive they weaken my case, for that's the path towards more productive, effective decisions. That may sound easy now; it isn't always so easy when I'm in a discussion involving a strongly-held belief.

I can introduce this approach to a group in perhaps 15 minutes, including some techniques for applying these premises in practice. It's hard work, though; it may take months of active help before a group begins to internalize these ideas in their routine interactions. This work is some of the hardest and yet some of the most rewarding I do. The first time I saw a group I had helped really begin to act this way, I was blown away by the progress they had made. Using these ideas along with others, they had shortened their process times by over 80%. They were highly effective at working together, cutting the time of making decisions from hours and days down to minutes, and the quality of those decisions had improved markedly. Deliberations were sometimes amazingly direct, and yet people felt really good about them. As one said (paraphrasing), "Now I know that people really hear me." If you're curious, you can read about that project in "Emphasis on Business, Technology, and People Cuts Turnaround Time at Hewlett-Packard's Lake Stevens Division." If you'd like to talk about this for your organization, give me a call.

And, when you're thinking about the topics of climate change and oil depletion (or business strategy and customer satisfaction), remember that how we talk about those issues may be as important as what we now think about those issues in achieving good results.

Why are we headed there?

Yesterday I posted a rather dark story about what we could be facing. As with any system dynamics model, it's showing the likely effect of the modeled policies; it's not predicting the future. (There is a difference; call if you'd like to chat about it.)

If that message is so dark, why don't we see much action to change our course? (Admittedly, we're beginning to see more action now.) The Oil Drum published Living for the Moment while Devaluing the Future, an essay exploring just that question. For a more academic approach, see Larry Karp's Global Warming and Hyperbolic Discounting, an article referenced at the bottom of The Oil Drum article (now on my reading list—I've only had time to skim it so far).

I think these ideas are important to understand and explore as we try to craft a "soft landing" from our ecological overshoot.

I think they may also be important to us in business. We get used to constant discount rates, because that's what we use. Do our customers and our bosses (they do have similar roles in our lives) really think that way, or do they do hyperbolic discounting, too? Would it it make a difference which they use? Would that difference imply we should act differently than we do?

Where are our policies leading us?

A policy is a set of guidelines or rules by which we make decisions. We have certain policies by which we work and live, even if we don't always make those explicit. If we see a pattern of decisions, decisions that seem cut out of the same mold, that's likely evidence of a policy.

François Cellier of the Institute of Computational Science of ETH Zürich, Switzerland has published an article, Ecological Footprint, Energy Consumption, and the Looming Collapse, at The Oil Drum that examines the potential effects of our policies towards growth. It's a high-level view, to be sure, but sometimes those offer great insights. Be sure to read both the article and the accompanying slide set (the article isn't that long; it's the 333 comments that take up most of the length).

I think this is a very important discussion. That's why I think it's important for each of us to be skeptical about such claims. It's not because I think he's wrong; his analysis, at least so far, seems good. It's not a call to wait for "proof," for, as John Sterman points out, we're not really waiting; we are doing things to the environment every day. It's not a call to ignore the claims, for that's not being skeptical; it's a call to test them and then to act based on what we determine. It's not a call for depression; Cellier does show a way forward (especially in the slides).

By suggesting we be skeptical, I may give the impression I think we can ignore this for a bit. I want to re-emphasize that the IPCC and others have given some pretty clear signals that the time to act is now (actually, the time to act was some years in the past; the next available time to act is now).

What does this mean for our businesses and for business in general? I think it means figuring out what to do to ensure the sustainability of our businesses and our economic system in the face of the challenges the best science says await us. The key lesson from "Out of Gas: A Systems Perspective on Potential Petroleum-Fuel Depletion" was that we not wait too long to attend to signals we get, for our systems have inertia, and we can't, as much as we might wish, always change direction instantaneously. Pay attention to Cellier's description of easy and difficult problems starting on slide 38; the signals may not be as we'd normally expect. Sometimes we can't wait to feel the wind from an impending storm; we have to rely on forecasts from meteorologists to know when to board up windows in the face of an approaching hurricane.

We can also apply that message to more typical business decisions. Do we discover we will need to add (or remove) capacity well in advance, so we can react smoothly, or do we make such discoveries only when the market begins to complain loudly? How do we figure out whether our latest initiative is about to make real progress or it's about to fail and we should abandon it and change course?

Reacting too soon can lead to the Chicken Little trap: if we respond too quickly, we diffuse our energies by responding to simple noise; if we respond too slowly, we're trapped. One of the lessons I've learned is that feedback models (of the sort I've sometimes discussed here, also called system dynamics models) can help us find what things to monitor so that we have a clearer picture to guide our decisions.

What do you think?

Evolutionary project planning

Rick Davies just posted Evolving storylines: A participatory design process?, a fascinating description of the evolutionary process of iterated variation, selection and retention applied to project planning, to project evaluation, and to storytelling. He raises more questions (for me, at least) than he answers, for he points at a range of variations one can try to see what works best in any one situation.

I think I'll look for opportunities to try it out.

IMT586: a course in system dynamics

While I have taught system dynamics and systems thinking courses and workshops for various organizations, some have asked if I was planning any public courses. I can now tell you that I'm the lecturer in spe for IMT586, a graduate course in information (system) dynamics for the Information School at the University of Washington. IMT586 will be offered starting in the winter quarter of 2008. It will be offered in the MSIM program to both day and executive students. It currently appears it will also be open to non-matriculated students, so, if you live within commuting distance of the University of Washington's main Seattle campus and are interested in learning system dynamics, check it out.

As we get closer and more information is available on the UW iSchool Web site, I'll post updates on Making Sense With Facilitated Systems.

Of course, if you want custom training tailored for your organization's needs, feel free to contact me.

An accidental experiment

I've published a number of At Any Rate™ columns through Pegasus Communications. They consist of text designed to capture people's interest up front and to remind them of what they experienced later as well as a simulation model people can download and explore. The model leads people through three stages: an initial stage-setting exercise, a more complete model to show added complexity in the problem at hand, and an exploration area where people can dig a bit deeper to try their hand at addressing the problem.

Pegasus Communications advertises each At Any Rate in their free Leverage Points newsletter that has a rather large circulation, and they set up a discussion area in their Pegasus Forums for each one.

In other words, that column seems to be planted in a fertile ground in which to talk about such things. The models are interactive. They tell a story. They are published on a high-visibility site and advertised in a high-distribution newsletter. There's a space established to enable discussion.

Yet I've gotten very few off-the-record comments (all favorable) about those columns. I've seen very few comments in the Pegasus Forum. I'm not sure anyone has contacted me about what they've seen there. I'm not complaining; I know that I don't write letters to the editor of the local newspaper, even if I strongly agree or disagree with what the newspaper has published. As a result, I don't necessarily expect (although I would welcome) lots of dialog about what I post online.

On Monday, April 9, I published a similar model (new URL) on Drew McManus's Adaptistration as part of his TAFTO 2007 (new URL) series. It was not interactive; rather, it contained diagrams, graphs, and a computer program (or a text-based model, which is the same thing). Admittedly, I tried hard to use literate programming ideas to intertwine the model and the story so that it would be more interesting and readable, and I let two others in the potential audience see an advance copy so I could find and fix any impenetrable sections.

Within a day, I had a thoughtful, lengthy comment added to that column. Two bloggers made quite favorable comments about the essay. I know of at least one person who had been telling me he'll get to the latest At Any Rate any day now who read and commented on my TAFTO column within a day.

What gives?

While I realize that the singular of data is anecdote, I think that this is showing me the barrier we erect when we ask people to download, run, and learn from an interactive model. While the barrier might be lower if I had used a simulator for At Any Rate that ran in a browser, I'm not sure; one would still need to take perhaps half an hour, perhaps more, to work through the model. It takes much less time to install the software, and i'ts a one-time action—a number of readers already have it.

The barrier may be more complex than simply the challenge of installing the isee Player required by the At Any Rate column. To explore and really learn from a simulation, someone needs to be willing to experiment. That means taking the time to understand the environment, to formulate hypotheses, to write those hypotheses down, to run various tests on the simulation model, to compare the results of the test with the hypotheses, and probably to try new experiments based on the learnings from initial experiments. That's far different than just opening the application, pressing a few buttons, and seeing what happens.

Needless to say, most of us who create such interactive simulations try hard to guide the user through the process. Most of us encourage people to form those hypotheses and to document them in writing or in graphs before starting a simulation. Yet I know (from personal experience—I'm not immune) that it's far too easy to treat a simulation as a video game: press the button, and see what happens. That's not often the path to deep learning.

With the non-interactive version, people can read just a paragraph or skim the entire article to see if it seems interesting. They can come back later to dig more deeply. They can print it out, if they wish, and read it on the bus on their commute. If a text version of the model is included, they can, if they want, copy it into the simulator and explore it themselves.

My lesson? Interactive simulation is no panacea, and it may be a disadvantage if I want to get my story told, especially if my audience consists of busy or high-level people. By telling a good story, I can help the reader learn something, most likely in less time.

Is there a role for exploration, experimentation, and interactive simulations? Certainly! But I need to be sure to consider the audience, their current interests, and what they know and want to learn.

I'd welcome others' insights and experiences. In an action research sense, I'll spend some time trying to disconfirm my conjecture; in the process, I might learn more.

Perceptions count

One of the features of many system dynamics models created to make sense of complex situations is the differentiation between the real thing and the perception of the real thing. We people don't often react to reality; we react to what we perceive as reality. That perception typically comes with some distortion and after some delay. To understand the system that created a problem we now face, we need to attend to those perceptions as well as to that reality.

Now there is Wharton's Out of Stock? It Might Be Your Employee Payroll -- Not Your Supply Chain -- That's to Blame which gives an example of how this works in retail. You can download the research paper by Marshall L. Fisher, Jayanth Krishnan, and Serguei Netessine, too.

Thanks to the TP! Wire Service for this lead.

Why few organizations adopt systems thinking

Russell Ackoff wondered about that in his blog posting today. More than just considering that question, he wrote of ways we can learn to learn more effectively from the decisions we make.

He closes with a request that we end our published articles with a statement how we intend to affect the behavior or thinking of the reader. Here's my list for this short posting:

• I want to get some of you (and me, more of the time) to try his Decision Record idea. That's very related to the learning logs Bob Williams and I developed, with extra emphasis on our decisions not to act. It's very related to a idea from Peter Drucker mentioned on page 101 of Effective Change Management Using Action Research and Action Learning: Concepts, Frameworks, Processes and Applications
• I want you to ask me if I use jargon in ways you don't understand. If you don't understand something, it's likely others didn't, either. It may even be that I didn't understand it, at least not well enough to get my point across. Perhaps we'll all benefit by your asking a question either in a blog comment or by email or phone.

Thanks!

Clark County Adaptive Management Program

Much of the time, we all keep certain details of our work private. Either we or our clients or customers don't want to tell others our secrets to success, lest others learn and take away our competitive advantage, or we don't want to expose our shortcomings, lest others find out which parts of our feet are made of clay.

I recently completed a project for the Clark County Adaptive Management Program. As a public program under the auspices of their Multi-Species Habitat Conservation Program (new URL) (MSHCP) (newer URL), it is subject to the Nevada Open Meetings Act, and thus their work and the work I did with them is public information.

If you're interested in what an early-stage dynamic modeling exercise might look like, take a look at their recently-published 2006 Biennial Adaptive Management Report (new URL) (newer URL). It talks about many things, including the work we did together to achieve three goals:

• Development of a system dynamics model(s) of conservation actions for implementation of the Multiple Species Habitat Conservation Plan.
  
• Use of the system dynamics model(s) to prioritize conservation actions to recommend for funding in the 2006 Biennial Adaptive Management Report.
  
• Use of the system dynamics model(s) to identify key uncertainties and information gaps to be recommended for funding in the 2006 Biennial Adaptive Management Report.
  

This effort was designed both to facilitate conversations among stakeholders who need to understand what the Adaptive Management Science Team is doing and how they make their recommendations to others involved in the MSHCP and to provide the Adaptive Management Science Team a new decision support tool.

Chapter 1 focuses on the model. You can download and explore a copy of the model we created together as Appendix B (new URL) (newer URL). If you don't own a copy of iThink™, you can download the free isee Player from isee Systems. I thank Sue Wainscott, Adaptive Management Coordinator, and the Adaptive Management Science Team for their support in this work. I also thank Ruth Siguenza, CPF, a long-term facilitator for the Clark County Desert Conservation Program (new URL) (newer URL), who first introduced Sue and me.

In many ways, this work resembles what Marjan van den Belt calls "mediated modeling," although I only discovered the term and her book Mediated Modeling: A System Dynamics Approach to Environmental Consensus Building part-way through this engagement.

By the way, if you happen to be in the desert near Clark County, Nevada and see a desert tortoise, please leave it alone; just touching it or picking it up can kill it. The Mojave Max Web site has more information on this amazing creature.

conservation
desert tortoise
endangered species
environment
system dynamics