Systems Thinking: Our Business Processes Involve Parts That Are Interrelated

Posted by on Feb 14, 2021 in Uncategorized | 0 comments

Systems thinking is a holistic approach to analysis that focuses on the way a system’s constituent parts interrelate and how these parts work together over time and within the context of larger systems.  A system includes all the interactions and interdependencies of the interrelated constituent parts.

Traditionally, we are taught to analyze our processes and look at each part separately.  The system, then, is the sum of all the individual parts.  It is the sum of all the employees, equipment, materials, methods, environment, and measurement processes we utilize to get the work done.  When we analyze these separately we fail to appreciate how these parts rely on one another to work effectively.

But all the parts do rely on one another to provide the products and services our customers want.  So how do we look at the system holistically?  One tool you can use to do this is the SIPOC.  The SIPOC model is an elaboration of Dr. Deming’s system diagram and is an acronym for Suppliers, Input, Process, Output, and Customers.  Your job, and the job of all the people in your organization, consists of a collection of SIPOCs.  If we examine any part of the process in the SIPOC model, we would discover a microcosm of the whole, a SIPOC within the SIPOC, a step within a method within a process within the system.

To understand the SIPOC model, we first start with purpose and how the different suppliers, inputs, processes, outputs, and customers interact with each other to accomplish the purpose.  The purpose of your organization is related to the benefits or capabilities acquired by your customers as a result of their interaction with you.

Moving from right to left in the SIPOC model, we next look at customers.  The customers are those who benefit from the products and services you supply.  Customers are those who acquire the capabilities you offer.  Understanding our customers’ needs allows us to define the outputs needed to satisfy our customers.  These outputs are the net results of our systems, process, and methods.  For better or worse, our customers get what the system is capable of giving.  The process, in our model, refers to the interacting systems, processes, and methods that convert inputs into outputs.  Whether suppliers are internal or external, your systems and ultimately your customers require a smooth, well-functioning flow between the suppliers and you.

A simple view of an organization then is to think of it as:

  • An aggregate of people
  • Working within systems and processes
  • To accomplish some purpose

The SIPOC model is a great way to help us look at those individual parts and think of them as a system of interrelated activities to meet customers’ needs and expectations.

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