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2019 | OriginalPaper | Chapter

11. Systems Thinking for Coherency

Author : Ivan Hilliard

Published in: Coherency Management

Publisher: Springer International Publishing

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Abstract

This chapter begins by explaining why management of social responsibility requires a systematic approach to understand complexity and provide organizational-wide solutions. It then analyzes why such an approach is useful and necessary, but not sufficient unless it is accompanied by a genuine implementation of the coherency conditions. It then assesses the role of systems thinking in driving change in complex adaptive systems, overcoming resistance, and dealing with different types of cognitive bias.

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previous chapter Getting to CORE

next chapter Coherent CSR

The debate around multinationals has focused on whether they are a force for good or evil in the world today. The answer, of course, is that they can be, and often are, both things (Drache 2001).

This is hardly new. Stakeholder theory, based on the idea that for an organization to survive it must respond to the concerns of a wider variety of actors, is built on a number of pillars, one of which is systems theory (Elias and Cavana 2000).

José Luis Blasco, the global head of sustainability at KPMG, is quite sure that there will be a lot of regulation in the coming years requiring disclosure on social and environmental performance (KPMG International 2017). However, this indicates the problem, in that the focus is moving from reporting statistics to reporting impacts, when what is desperately needed to effective and swift solutions to those impacts.

Systems thinking in this chapter refers to the idea that organizations are parts of a system, made up of many interrelated actions and unseen links, some of which take years to show the effects on each other. As it is part of a system, the organization has difficulty seeing the system holistically, as if from above, and understanding the myriad links that form it. Systems thinking tries to promote such holistic thinking, rather than the usual approach of assessing singular elements of the system, which fail to undercover the reality of the world of which the organization is a part (Senge 1990).

The 2015 PWC Annual Global CEO Survey involved 1322 interviews in 77 countries. The theme was how to create value in a rapidly changing world. The burning issue of climate change was not even on the list of key organizational concerns or main strategic priorities (Confino 2015).

Though this approach those who provide value, rather than those who affect, or are affected, should enable organizations to better identify with whom they need to deal with, in a way that they can easily understand. For example, two issues that would be of great relevance for a tech company would be data protection and product life cycles. In the former, it is much easier to identify the issues that are relevant today for customer’s data protection and respond appropriately to ensure that the organization is acting responsibly. It is not so easy to imagine technologies not yet invented, that as-yet unborn generations will use and understand what specific measures must be taken regarding their data protection.

The same applies to a telephone or tablet reaching the end of its life. It has been built using materials that if dumped on land or at sea, will damage the environment. The environment is therefore providing a direct service, which would normally be paid for. A responsibly minded company, rather than pay to dump, will pay to ensure that their products do not damage the environment once their useful life is terminated. This could be through better design providing for their reuse or by paying more for less contaminating materials or non-damaging disposal.

This should not be interpreted as a justification not to initiate such a change (as the organization in question may well be amongst a significant minority when doing so). Rather, the opposite is the case. Particularly for early movers, the importance of accessing external resources and capabilities is of the utmost importance and can be a key determinant of whether the venture prospers or not (Baum et al. 2000).

In fact, this clustering is what causes system complexity itself. Interacting agents tend to assume some characteristics of those they interact with, which drives increased interaction, and hence, more complex systems (Marion and Uhl-Bien 2001).

There were a number of other errors on Kotter’s list, which are not relevant here. For example, he mentioned the need to have a vision linked to the change process, and institutionalizing the changes, both of which have been mentioned extensively in this book.

It may well be the case that an organization that has never shown any concern other than making profits for shareholders will have it somewhat easier in implementing a coherent approach. It will be a clean break, without any baggage.

This refers to many well-known firms deemed to have made serious efforts (even if ultimately in vain). Those involved in pure greenwashing will have a lot more difficulty in persuading anyone that they are serious.

See the next chapter for a detailed explanation of types of bias.

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Title: Systems Thinking for Coherency
Author: Ivan Hilliard
Publisher: Springer International Publishing
Book: Coherency Management
Print ISBN: 978-3-030-13522-5

Electronic ISBN: 978-3-030-13523-2

Copyright Year: 2019
DOI: https://doi.org/10.1007/978-3-030-13523-2_11