"The performance of a system depends on how its parts interact, not on how they act taken separately. Therefore, when the performance of parts taken separately are improved, it does not follow that the performance of the system as a whole will improve.

 

In fact, in many cases, it will get worse….The properties to be desired of the parts of a system should be derived from the properties desired of the whole, not conversely."

 

—Russell Ackoff

 

 

 

 

 

The Whole Systems View of Organizational Performance

 

We owe our original thinking about organizational dynamics to the late Harold Leavitt. Formerly a professor at Stanford University and Claremont University, Dr. Leavitt was one of the great management thinkers of the 20th century. His textbook, Managerial Psychology, written in 1958, is still a classic in management literature.

Harold developed what became to be known as the Leavitt Diamond. In this model, people, tasks, structure and technology were described as elements of an organizational system. Changing any element, according to Leavitt, had effects on the other elements and on the tasks to be performed.

In the opening of book chapter 24, Harold describes a scenario in which a corporate manager, faced with an organizational problem calls in a consulting firm specializing in structural approaches . He proceeds to describe the recommendations that the manager receives from the consulting firm. Wanting an independent assessment, the manager calls in a second consulting firm specializing in technical and analytic methods. In turn, this firm provides recommendations that are very different from the first consulting firm.  Finally, the manager calls in a human-centered consulting firm, and once again, receives a set of recommendations that differ from the first two consulting firms.

Since Harold’s time, consulting firms have become even more specialized, with the need for a corporate client to be very clear about the problem definition lest he or she gets a set of recommendations that follow from the specialty of the firm, instead of from an in-depth understanding of the problem.

Like the original Leavitt Diamond, our model recognizes the interdependent nature of the elements of an organizational system. We also recognize how thinking about organizations has expanded in the decades since Managerial Psychology was written. For example, the concept of business strategy emerged in the 1960s and the concept of corporate culture emerged in the early 1980s, while information technology gained prominence in the 1980s and 1990s. The result of this emergent thinking, coupled with the continuing emphasis on the organization as a system, has led to our Whole Systems View of Organizational Performance. Unlike the scenario first described by Harold Leavitt, however, you will not receive from us a specialized set of recommendations. While we have in-depth expertise in the various specialties of the model, our focus is on understanding how these specialties all interact and either enable or hinder corporate performance.