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MBA Operations & Process Management
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Do We Need to Improve?
Why are we last, for decades?
2018 U.S. News (again) ranks Louisiana as the
worst state in the country
https://www.usnews.com/news/best-states/louisiana
• Health Care NATIONAL RANK #47
• Education NATIONAL RANK #49
• Economy NATIONAL RANK #44
• Opportunity NATIONAL RANK #50
• Infrastructure NATIONAL RANK #44
• Crime & Corrections NATIONAL RANK #48
• Fiscal Stability NATIONAL RANK #48
• Quality of Life NATIONAL RANK #42
• Natural Environment #49
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Changing Workforce
Baldrige is a Changing Politics 9.7 Billion
Transformational Changing Standards
Humans
Framework
for Changing Technology
High-Performing Changing Resources
Organizations
Changing Customer Current World
Population
Expectations
Changing Economy
Changing Values
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Based on Complex
Integrated Systems
Framework
---------------------------
Not Traditional
Organizational Chart
of Functional
Departments
http://www.baldrige21.com/Baldrige%20Model.html
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Performance Excellence
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Preliminary Comments
• Many people have wondered why Deming and his
disciples succeeded in their consulting work.
• Executives are frustrated because businesses
succeed at the rate of random error.
– Tremendous turnover
– Constant failure
• Critics of business attack the salaries of executives,
even though many (most?) fail.
• Why do some executives succeed, while others
fail?
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Systems Theory
• All phenomena are linked together.
• Interconnectivity in organizations affect the
outcomes more than direct effects.
• Silo departments and academic knowledge force
people away from addressing interconnectivity.
• Most organizations are characterized by
“random acts of improvements,” in which many
parts of the organization undo or cancel actions
of other parts of the organization.
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Variation
• All systems have variation.
• Eliminating or at least reducing variation is key
to success, reducing costs and increasing
satisfaction. Uncontrolled variation is evil.
• Errors, defects, waste, complaints, repairs,
warranty claims, bad invoices, inspection and
other non-value adding activities arise from
variation.
• Successful executives master variation and view
every system and process through the eye of
variation.
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Variation
• Variation is the difference between an
observed event and a standard or norm.
• What type of variation arises from a single or
small set of causes that are not part of the
event or process and can be traced and identified
and then implemented or eliminated?
a) Random variation
b) Assignable variation or Special Cause
c) Inverse variation
d) Inductive variation
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Control Charts
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Control Charts
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Control Charts
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Knowledge
• Executives must have a personal standard for
accepting information as “facts.” Careers are
made and lost on information.
• No “fact” is true.
• Nothing is known with certainty.
• Executives must be comfortable with the
fallibility of their knowledge.
• Continuous improvement and refinement is
necessary for career success. Never being
satisfied with current knowledge.
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Psychology
• People impact systems.
• People are a moral responsibility of executives.
• Executives must appreciate the differences in
people and the extent to which those
differences affect the organization.
• To influence people, information must be
delivered in a format amenable for reception.
• Work teams must be composed systematically
and carefully to maximize performance by
combining workers with different complements
of talent.
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Conclusion
• All organizations are complex systems.
• That complexity must be addressed by executives.
• Most executives are unable to address the
complexity. We have only started with the
complexity. More later
• Toolkits for addressing complexity help.
• The vast majority of people are too lazy to do the
hard work needed for success.
• “No substitute for leadership”—no truer words.
• Survival is optional.
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Systems
• Welcome to the world of systems and
systems thinking! You may be asking
yourself, Why is it important to explore
systems?
• One reason is that we live in and are
influenced by systems all around us, from
the natural environment to health care,
education, government, and family and
organizational life.
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WHAT is A SYSTEM?
A system is a group of interacting, interrelated,
or interdependent components that form a
complex and unified whole. A system's
components can be physical objects that you
can touch, such as the various parts that make
up a car. The components can also be
intangible, such as processes; relationships;
company policies; information flows;
interpersonal interactions; and internal states
of mind such as feelings, values, and beliefs.
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Defining Characteristics of
Systems
Systems have several essential
characteristics:
1. A system's parts must all be present for
the system to carry out its purpose
optimally.
2. A system's parts must be arranged in a
specific way for the system to carry out its
purpose
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Defining Characteristics of
Systems
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Systems Feedback
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Systems Stability
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Structure
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Levels of Thinking
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The Principles of
Systems Thinking
In general, systems thinking is
characterized by these principles:
1. thinking of the "big picture“
2. balancing short-term and long-term
perspectives
3. recognizing the dynamic, complex, and
interdependent nature of systems
4. taking into account both measurable and
non measurable factors
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The Principles of
Systems Thinking
In general, systems thinking is
characterized by these principles:
5. Remembering that we are all part of the
systems in which we function
6. We each influence those systems even as
we are being influenced by them
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Systems Thinking
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Drifting Goals
• The “Drifting Goals" archetype
states that a gap between a goal
and an actual condition can be
resolved in two ways:
• by taking corrective action to
achieve
• the goal, or by lowering the
goal.
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Escalation
• The “Escalation" archetype occurs when one
party's actions are perceived by another party to
be a threat, and the second party responds in a
similar manner, further increasing the threat.
• Example: Negative Focused Political Rhetoric
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Ron
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Schulingkamp
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Ron
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Schulingkamp
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1. Do you understand
Terrorists you are in a System? Threat To
Recruits Americans
2. How do you change or
break the System?
Ron
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