How to build system thinking using Business Excellence Models

Organisations are regarded as systems because they have a set of interconnected elements unified by design to produce a common goal.

System thinking is the ability of management and employees to understand how organisation parts ( leadership, strategy, processes, customers, Infrastructure, resources, etc.) interact and influence one another to achieve overall strategic objectives.

All business owners, CEOs, managers, and employees should understand that these elements can only function effectively if they are harmonised and synergised. Once this thinking is infused in the entire system it influences the way the organisation does things ( culture) starting from the way it makes decisions, its policy direction, its communication systems, problem solving approach, risk management and performance management.

The Business Excellence Model ( Excellence

Management System) is a formula for success, and it is used as a management approach to build an effective system that achieves sustainable performance. Some of the common business excellence models around the world are African Excellence Framework, Australia Business Excellence Model, Canada Excellence Model, Baldrige Performance Excellence Framework, European Foundation for Quality Management.

This article describes how business excellence model elements promote system thinking and sustainable performance excellence. The first important element of any organisation, also known as the excellence principle in these models is leadership.

Systems thinking encourages leaders to view the organisation as a whole and to consider how their decisions and actions impact various parts of the organisation. Leaders are encouraged to set a clear strategic direction that aligns all parts of the organisation towards common goals and objectives.

They must also recognise the interdependencies between different departments and subsequent teams. Common leadership best practices that demonstrate system thinking are cross functional teams, cross functional communication, system performance measurement and continuous improvement. The second most important element of any organisation is the strategy also recognised in business models as a core strategic direction element. When developing and implementing a strategy, systems thinking calls for an understanding of how different components of the organisation will be affected. It involves identifying key leverage points within the system where changes can have the most significant positive impact on achieving strategic goals. The common strategy best practices that show system thinking are environmental analysis, analysis of stakeholders needs, analysis of organisation performance, involvement, and participation of both internal and external stakeholders in strategy formulation and implementation.

The third most important element is the business processes. Systems thinking plays a crucial role in optimising processes and delivering high- quality products and services. To do that organisations should adopt the habit of bundling process along their value streams, and they should continuously manage their processes by identifying waste, bottlenecks, and opportunities for improvement. Processes are core in creating an effective system that delivers expected results. Any organisation that exists without defined and documented processes that are managed on a daily basis is lost because it lacks the backbone to implement its mission and achieve its vision.

The fourth element is the employees. Employees make every other element function properly through their cognitive abilities and technical abilities. Therefore, they are the pivot of the organisation and to maximise their full potential, they need to be stimulated to believe in themselves and deliver performance targets by respecting, appreciating, training and involving them in the organisation’s decision making.

Moreover, systems thinking recognises the importance of employee engagement and development, as well as understanding how the organisation’s culture and values influence individual and team behaviours. The fifth element is resources. In managing resources, organisations must have a resource plan that clearly articulates where resources are needed in their broader system, how they will be acquired, distributed, and managed to deliver desired results. Lack of effective resource management is a clear sign of lack of system thinking.

In mature organisations that value excellence, resources are linked to strategic goals and departments organise themselves along those goals and use these resources wisely to achieve these goals.

The sixth element is customers and stakeholders. Systems thinking extends to understanding how an organisation’s interactions with customers and stakeholders impact its overall performance. It involves collecting feedback and data to gain insights into the system’s health and performance from external perspectives.

In conclusion, systems thinking encourages organisations to move beyond a reductionist view of their operations and instead adopt a holistic perspective. This approach acknowledges that every action and decision within an organisation can have ripple effects throughout the system and, therefore, should be considered in the context of the whole to achieve sustainable excellence.

The Author is a member of African Excellence Forum, holds Master of Science Degree in Strategic Management, is a Certified Manager of Quality and Organisational Excellence from America Society for Quality, a Master Excellence Assessor and Certified Professional Excellence Assessor, Lean Six Sigma Greenbelt, ISO 9001: 2015 Certified. Contact: 72211182, Website: www. iqm. co. bw and Email: veronmosalakatane@ gmail. com LinkedIn: Veron Mosalakatane