The meteorologist was an American called Edward Lorenz, who chanced across the theory that small differences in his calculations could cause substantial changes to his simulations. On the other hand, as he put it more simply: In it he wrote:
November 25, Because most things in life are part of larger systems, some seemingly trivial events can have significant impact. The flapping wing represents a small change in the initial condition of the system, which causes a chain of events leading to large-scale alterations of events.
Had the butterfly not flapped its wings, the trajectory of the system might have been vastly different. Consider a ball rolling down a hill.
If you start the rolling at the top of the hill rather than 20 feet from the top, or even five feet from the top, the change in velocity will determine how far it can roll.
Similarly, if there are changes in wind speed, surface tension, or any number of other variables, the eventual landing spot of that ball will change.
Or consider the impact that small changes in our climate are having on various ecosystems.
An increase of only 1 to 1. Not to get into the politics — or even scientific root causes — of global warming, but the simple event of increasing worldwide temperatures by The butterfly effect managing the organization 1 or 2 degrees is having dramatic effects on many ecosystems.
Or consider the impact of too much use and not enough regulation of mortgage-backed securities. People across the world began to enjoy a false sense of wealth as their real estate values artificially increased last decade.
Many would take on increasing levels of debt and so would our banksbut when several triggers impacted the system oil price increases, monetary policy easing, and federal budget deficits, to name a fewthe system began to unravel and real estate and stock market values began to plummet, which in turn caused a slowing in economic output, which led us into a worldwide recession.
Many would argue that we have not addressed the underlying issues that caused the recession, and with additional factors beginning to emerge instability in Europe, for examplewe could be in for more tough economic times in the future.
Yes, the worldwide economy is a highly interconnected system. Most things in our lives are parts of larger systems, where various parts of the system interact and affect various other parts of the system.
In nature, systems thinking examples include ecosystems, in which various elements such as air, water, movement, plants, and animals work together to survive or perish. In the human body, various systems work together to sustain life. For example, the cardiovascular system with the heart, veins, arteries, and blood carries oxygen and nutrients throughout the body; the neurological system supports movement, response to stimulus, and decision making; the digestive system mouth, esophagus, stomach, intestines, etc.
If any one of these systems or any part of any one of these systems is not working properly, the body suffers disease, disability, or some form of sub-optimization that affects lifestyle or life in general.
All parts of the car work in combination to make the vehicle operate, and if any one of them to fails, the car will not perform or not perform well. In organizations, systems consist of people, information, and processes that work together to make an organization healthy or unhealthy.
Organizational systems theory dates back several decades, traced to early work of experts such as Deming, Ackoff, Senge, and Wheatley, among others. Collectively, these experts believed that organizations were highly complex systems, and that managers should therefore manage organizations as systems rather than only focusing on its individual parts.
In fact, these experts believed managers should view problems as parts of an overall system, rather than only reacting to specific events, failures, or process problems the result of which could contribute to unintended consequences. Take, for instance, an organization that introduces a new product without fully considering the impact of existing products?
Or a certain engineering team reacting to a design defect by changing a spec, but not considering what impact that might have on the overall product performance quality, warranty claims, customer complaints in the call center?
Or manages who change a staffing schedule because of workforce shortages without considering customer traffic patterns or the impact on direct customer service?
A systems perspective is based on the belief that the component parts of a system can best be understood in the context of relationships with each other and with other systems, rather than in isolation. And a systems perspective focuses on cyclical, rather than linear, cause and effect relationships within and between organizations.
This is where I believe many organizations struggle: Surgeons would never just start cutting on various body parts without considering the impact on the heart, brain, and other various organs and systems!
So why do managers sometimes make changes to processes, technology, workforce policy, customer-facing processes, and so forth without first gathering requirements and then studying the impacts of various potential changes to the system?
According to the Baldrige framework: The result of better alignment is more predictable and ever-improving outcomes. For an organization, then, having a systems perspective means several things: In essence, a systems perspective means managing your whole organization, as well as its individual components, to achieve success.
So what are managers to do? It sounds a little self-serving, but enlightened leaders from higher performing organizations or at least those who aspire to be higher performing use organizational assessments based on validated best practices to diagnose their systems — to verify what is working well in their systems and identify and prioritize opportunities for improvement.
Much like an annual physical for your organization, these assessments uncover blind spots, redirect resources, inform planning, and refocus efforts on the most important areas of your organizational system. All three assessment processes are based on a validated set of best practices from leading organizations across the US; all three are diagnostic in nature and help inform leaders of where in their system they need to focus their attention and resources; all three promote organizational learning; and all three assist with resource optimization, process improvement, and improved and sustained results.
So the bottom line is this:The Butterfly Effect: Managing Your Organization as a System Because most things in life are part of larger systems, some seemingly trivial events can have significant impact.
For example, in , mathematician and meteorologist Edward Lorenz took a shortcut in entering data in a weather prediction model. The Butterfly Effect: Managing Your Organization as a System November 25, Because most things in life are part of larger systems, some seemingly trivial events can have significant impact.
The Butterfly Effect “The Butterfly Fly Effect is a term used in chaos theory to describe how small changes to a seemingly unrelated thing or condition can affect large complex systems.” (Ellis).
It is the theory that everything matters. The butterfly effect can also be initiated by events entirely outside of the organization or company.
For example, some new local, state, or federal changes in laws or regulations can have a large impact that may hit the company in unexpected ways out of the blue. This is an example of the “Butterfly Effect”, and demonstrates how the impact of a leadership or management decision can affect everybody else in the organisation.
Research from Gallup, in the United States, during the last decade revealed that what staff wanted from their managers was trust, stability, hope and compassion.
The butterfly effect can also be initiated by events entirely outside of the organization or company. For example, some new local, state, or federal changes in laws or regulations can have a large impact that may hit the company in unexpected ways out of the blue.