Innovation and Transformation

While system steering is mainly concerned with course correction of the system towards set-course within defined system structure (elements, goals, properties, governance, relationship, sub-system) in order to achieve stated goals, maximize efficiency, effectiveness, capability and potentiality.

While adaptation refers to adjustments in systems in response to actual or expected stimuli and their effects or impacts with respect to dynamic properties of a viable and sustainable system (potential , connectedness and resilience) . It refers to changes in processes, practices, and structures as a response to environmental change.

Systemic adaptation is about ‘doing the right things considering system state and environmental conditions:

  • Steering known system towards set-course
  • Transformation – totally new paradigm: involving a terminus or crumbling paradigm. Totally new system definition and governance model
  • Innovation – step change in product or service offering within established system definition and governance model

Where adaptation is ineffective it can be catastrophic: Some example of poor adaptation where organization/systems disappeared or are in permanent decline:

  • Yahoo
  • Nokia
  • Texas Instruments
  • Kodak
  • Polaroid
  • Compaq
  • NEC
  • Amiga
  • Palm , Sony Erikson ect….
  • Catastrophe amongst major Banks surviving due to extensive public intervention
  • Permanent decline of the of the Greek and Italian economic system within the EU

Each of the above can be attributed to ether failing to understand that their the system set-course was defined within a crumbling paradigm (Kodak) or its poort innovation approach (Nokia insistence with Windows mobile killed the company).

Failing to do the right things impacts system viability due to a decline in system sustainability related to its potential and resilience. Adaptation failure are also caused by poor governance, inability to steer the system right direction considering system course set and environmental conditions.

 Transformation is the process of starting or and ending a paradigm involves a terminus.

Start implies a new paradigm that may result in the end of existing paradigm or triggering a crumbling paradigm. Typical example digital versus film (which marked the end Kodak ), or the shipping container, email. Within a system/company, it implies the complete redefinition of its core value proposition – change on system broad model, a pattern, a framework, way of thinking for understanding reality, behavior, and the rules within the system boundaries.

Innovation is the process of evolutionary step-changes in a product or service offering within defined system paradigm.  Think about incremental releases (versions) of software – each designed to build from the previous, but adding various improvements in design and ability or new auto car release within existing series.  Innovation operates within existing system within know system elements and their functional relationship and environmental conditions and existing governance model.

Adaptation activities span five general components: observation; assessment of system impacts and vulnerability; planning; implementation; and monitoring and evaluation of adaptation actions.

Observation

At the outset of any adaptation initiative, observation and monitoring via system cockpit of key goals and essential variables is important to understand system behavior that will lead to adaptation that will then enable improved understanding, modeling and prediction of the system change impacts. The system cockpit in order to be effective should provide:

  • Key variables , their historical progression, association of key events
  • Properties/attributes of key variables and association with other variable and system elements in order to understand dynamic progression
  • Variables association to goals and target
  • Association of past event to variables
  • Alerts

Assessment

Adaptation assessment refers to the practice of identifying options to adapt system to change, and evaluating them in terms of criteria such as benefits, costs, effectiveness, efficiency and feasibility

Planning

Defining the key adaptation initiative and their priorities, expected benefits, areas of the system , cost , change management effort, timing , governance model to ensure effective application and monitoring of the initiative.

Implementation

Implementation entails the realization of adaptation initiatives. Entails creating a realization specification that clearly defines the WHAT and the HOW to effectively realize the adaptation initiative:

  • The type of adaptation: steering changes, innovation or transformation
  • The actual initiative
  • Impacting elements of the system/sub system (Enterprise IT architecture)
  • Cost and benefit
  • Risk analysis
  • Time- line
  • Supporting governance model
  • Impacting variables
  • Change management , training
  • Monitoring criteria to determine efficacy of the initiative
  • Timing
  • Status

Monitoring and evaluation

Given the complexity of the system initiative, it is essential that adaptation initiative is designed that it includes feedback, its essential variables, goal states to enable effective monitoring and evaluation: fundamental for continuous learning and understanding efficacy and possible emergence of unintended consequences. The implementation of the adaptation initiative needs to be regularly monitored, evaluated and revised, both in terms of the validity of the underlying assumptions and the appropriateness of initiative intervention including their effectiveness, efficiency and overall utility. The monitoring and evaluation framework must be developed to ensure clearly formulated goals, objectives and output measures as well as the availability of good quality data obtained via a system cockpit.

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