The Soft Systems Methodology In Business Commerce Essay

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The report attempts to comprehend the various methods of Soft Systems Methodology that are applied to a business situation. The methods help to breakdown the bigger problems into smaller issues that can be dealt effectively. The idea of Soft Systems Methodology (SSM) is to facilitate & to organise thinking about, and intervention in, complex organisational issues.

Soft Systems Methodology (SSM) is a cyclic learning system which uses models of human activity to explore with the actors in the real world problem situation, their perceptions of that situation and their readiness to decide upon purposeful action which accommodates different actor's perceptions, judgements and values (Checkland. P., 1984, p. 98).

SSM helps to initiate and to manage the processes necessary to accomplish an organised action and to offset the changes that might affect that action. Each employee in the organisation see the issues differently that may lead to varying perceptions & considerations of the issues that results in varying ideas for positive action. These ideas may or may not be same; however, they may be related to identify an action for the issue.

SSM was developed because of systems thinking, to enable rational action. Checkland (1981) states systems thinking is an attempt to avoid the reductionism of natural science and come to different conclusions.

There are several ways to analyse the issue, Checkland & Scholes (1990) has suggested following activities to analyse the issues in an organisation:

Understanding the real-world situation: Appreciation of the problem situation helps understanding the organisation's issues in the SSM process & Expression of the problem situation helps to organise & structure the understanding of the organisation's issues & also to enable & facilitate the analyses.

Conceptual Modelling: Identify the major issues and formulate root definitions (including CATWOE) relevant to them and build conceptual model as a logical extrapolation of each root definition. The conceptual model must include the operational activities that would be necessary to carry out the process described in the root definition.

Comparison: The ideas generated are compared to the real-world actions. The important differences between the conceptual models and the real-world situations are defined that are feasible and desirable.

Action needed to improve the situation: To organise the ideas from previous stages to improve the situation and check if the changes would actually work in practice.

The figures illustrate the process of SSM analysis:

à The Organisation & the Circumstances: (Appreciation of the problem situation)

The great recession of 2007-2010 has affected the organisation severely. There were layoffs, job cuts & cost cut plans implemented. The employees complained about too much work, lack of clarity, mistrust and miscommunication. Due to this, the employees were stressed and couldn't meet the service level agreement (SLA). This created a rift and threatened to affect the future projects with organisation's business partners i.e. clients.

The clients complained of unprofessional & unorganised business practice. Information from the market sources meant that the clients were shopping around for more reliable business partners. The survey conducted in the organisation showed the employees were discontented with their supervisors and the organisation was losing its reputation with all the chaos going around.

The policies of the organisation became more stringent. To compensate the loss of business and revenue, the employees have to work for six days instead of five days a week for undue period with no extra pay. All these things stressed the supervisors to make their respective teams work better and meet the targets.

à Rich Picture: (Expression of the problem situation)

Rich picture makes use of drawings or pictures to assemble information about complex situations. Checkland (1981) introduced rich picture as an approach to recognise that issues do not exist separate from the people involved in them and values the multiple viewpoints of the participants. SSM tries to understand human systems that are meaningful to actors in the systems.

Rich pictures are tools to learn not only about the obvious facts of a situation, but also about abstract things like the social atmosphere among the actors. It gives a better perceptive of how the organisation's culture seems to work and as much of the internal politics of the situation as possible.

The rich picture shows the issues in the organisation:

The situation involves the supervisors from human resources & operations department, employees, business partners & macro-economic situation.

Human Resource Managers: HR is responsible to hire employees, reward & recognition, strategic pay, employee development & appraisal systems and career & succession planning. They review the effectiveness of the employee. Here, they had the responsibility to shortlist the employees for layoffs and salary cuts.

Operations Managers: Operations managers look to develop staff potential, increase the returns on IT investment, improve the effectiveness of the operation and set service level agreements with end-user applications. They give the report about the progress of the employees to the HR department. The operations managers were in tremendous pressure to meet the service level agreements set for the clients. They were targeted for the loss of business and hence stressed.

Employee: Due to the uncertainty revolving around the jobs, the employees were stressed. The cost cutting initiative, layoffs, no incentives or appraisals made employees de-motivated. Due to this, the employees were not able to give their 100%, hence, the total productivity decreased.

Business Partners: The clients complained about unprofessional & unorganised business practice as service level agreement was breached on several occasions resulting in loss of business. As a result, the clients were shopping around for more reliable business partners.

Macroeconomic Situation: Recession badly affected the organisation. The organisation suffered due to credit crunch, falling housing prices, sub-prime lending etc.

Note: The rich picture is not the illustration of the organisational processes; however it states the issues in the situation, and the association between the issues, opinions and attitudes.

à Root Definition including CATWOE:

This is the stage in which modelling of systems take place. Root definition is the organised description of the system pertinent to the issues. Root definitions help to understand the immediate objective, means to accomplish the objective and the longer term objective of the organisation.

The most important thing is to identify & include one objective in a single root definition.

The immediate objective of the organisation is to meet the service level agreement. By motivating the employees & setting realistic goals would help accomplish the objective. This would help to hold on the present clients.

CATWOE: It helps to recognise the positions that can be taken in the system illustrated in the root definition. CATWOE stands for:

In short, a system is owned to do world view by actors by means of transformation given the environmental constraints in order to achieve the objective for the customer.

Here, a system owned by the partners & the management and used by all the employees to implement the plans with several restrictions to meet client's requirements and hence maximise profit.

To make the system work, it is needed to check if it is efficacious, efficient & effective.

Efficacy: To check if the system works in its own terms.

Efficiency: To check if the system works with minimum use of resources.

Effectiveness: To check if the system meets the long term objective.

To meet SLA regularly set by the organisation and the business partners is the immediate and the long term objective.

à Conceptual Model:

To identify the steps necessary to carry out the process described in the root definition. All the steps are interdependent. The conceptual model gives the immediate objective, means to accomplish the objective and the longer term objective of the organisation. Motivating the employees can be identified as the system.

A motivated employee is an asset to the organisation as the employee aspires to achieve the goals. The goals of an employee are aligned with the goals of the organisation, when employees meet the deadlines, it helps the organisation to meet the deadlines and increase the productivity.

However, it should be noted that motivating the employees is a process not a task. The process can take time to motivate the employee.

Motivation as process model:

The models on which the analyses is done are developed by identifying the functions that needs to be performed for the transformation. The functions depend on the performance of other functions; hence, these functions become important and need to be included in the model. The interdependence of the functions is indicated by the arrows leading from a given function to the other function dependent on it. The process is continued until all the functions have been identified. Besides these functions, several other functions are added. These functions check for the effectiveness and efficiency of the process i.e. the control system. The system could identify if the parameters for proper standard are met. The system would enable to provide the feedback on the process as it can monitor the process to take corrective action.

à To compare model with real-world actions:

Here, the conceptual model is compared with the relevant systems in the world. The comparison of the model with the real world gives an organised understanding of the situation. It helps to identify if the model and the ideas generated are practical.

Checkland (1984) suggests four ways of doing the comparison:

Unstructured discussions

Structured questioning of the model using a matrix approach

Scenario modelling

To try to model the real world similar to the conceptual model

A common way of doing comparison is to draw a table to check if the activity exists & how is it done and assessed.

à Define feasible & desirable changes:

The activities listed exist in the real world, therefore, the means to improve the performance & efficiency of the activity should be considered to improve the real world situation. The activities should be systemically feasible & desirable. The activities need to be assessed in terms of potential benefits & costs and the issues that may arise. The analysis is done comprising three roles:

The roles are interdependent.

Cost Benefits: Motivation is benefits minus cost.

The proposed systems change can benefit the organisation in several ways:

àAn achievement motivation program would help to increase sales, monthly profits & income.

àIf the organisation spends time & effort, they could motivate the employees without any expenditure.

àMotivating the employees is a continuous process, however, as opposed to one-off reward, the organisation may find their time & effort last longer when the employees are motivated.

àProductivity is the direct result of improved performance and performance can be improved by motivation.

àIncreases discipline amongst employees, hence, attendance & productivity.

àMotivated employees give sincere efforts to meet deadlines and SLA.

àIt would help to avoid strikes and any activity that obstructs organisation's performance.

àIt would help in making the efficient use of available human resources.

àIt would minimise disruption in work.

àLess cost would be applied on hardware & software if the employees are efficient & effective.

Potential Resources:

àEfficient & effective resources i.e. employees

àClient retention rate can be improved by meeting SLA.

àBusiness reputation would improve if the better service is provided to the clients.

àClient satisfaction by providing differentiated service that matches or surpasses the client's expectation.

àCompetitive advantage can be gained.

àSelf management capabilities of the employees

à Recommend Actions to Improve the Situation: From all the steps generated, the following steps can be taken for the greater positive effect.

System Approach:

The soft system approach can be applied in almost all business situations where there is a need of enhancing the understanding of a problem situation so that steps for improvement can be taken place & at subsequent stages clarifications can be made (Patching, 1990, p. 34). The need to establish a system depends on the type of system constructed and the way it is to be used. To check the validity of any system as a part of SSM is difficult. The root of the problem situation is the inability to systematically identify & describe the objectives amongst the numerous and conflicting alternatives (Checkland, 1999, p. 52).

Here, in this case, the participation of organisation and employees is crucial. Involving organisation and employees would ensure a positive result and the acceptance of such approach. The SSM is very effective where the objectives are not defined and lacks clear objectives.

To become better management practitioner:

àSSM requires a complete participation of the organisation and the employees.

à Need to fully understand the problem situation before developing a system or else that could result in developing systems that lacks important work practices. It may lead to reduce efficiency and effectiveness (Kuhn, 1996, p.275)

àIt's difficult to surmise the world correctly; hence, an urgent desire for action should be avoided.

àTo make the rich picture without a clear structure and solution to the problem situation is difficult.

àDo not narrow down the analysis very soon.

àBe clear about the positive effect of developing a system.

àThe final recommendations should make sense to the organisation.