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CMSCB3004Systems, Cybernetics and Management

Hard Systems Thinking

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Development of the Hard Systems Approach

• Defining the approach Assumes the managers task is to solve clearly defined

problems Assumes a hard scientific/engineering basis Attempts to reduce the gap between the current state of

affairs and the desired state of affairs (economically)

• Core Beliefs Measurement and quantification are central to the approach Assumes problems assume general characteristics and can be

classified as a ‘type’ Once that type is identified standard solutions can be

systematically derived

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Hard Systems Assumptions• All hard systems approaches begin with the

assumption that the problem-solving process begins with a definitive problem statement

• The end point of the process is to change the system to eliminate the problem

• The process itself then becomes the identification and evaluation of efficient/economic ways to get from the beginning point to the end

• Two example approaches - Operations Research

Systems Analysis • Both rely to some extent on mathematical modeling

(reduce the system to basic numerical form)

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Uncertainty Reduction

• Attempts to reduce complex problems to simpler elements

• Takes the view that complex problems are simply an accumulation of many simple problems

• If simple problems have simple solutions then the approach to complex situations is to break the problem into its constituent parts and apply the appropriate technique to those problems

• However Parts in isolation rarely behave in a similar manner when

embedded in a system Assumes it is important to know the inner working of parts not

how they relate Such reduction does little to how how the overall system works

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The Fundamentals of Hard Systems Thinking

• Identify the problem (Problem Definition)• Identify alternative solutions• Evaluate the costs and benefits of each

alternative• Eliminate the causes of the problem

(Implement the solution)• Transform the system to attain the desired

state of affairs

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Rational Decision Making

• Decision making has been defined as “…selecting a path which will move the system - individual,

computer program or organization - from some initial state to some terminal state”

• So in this view decision making comes down to the identification and selection among satisfactory alternatives

• Such choice is limited by the parameters present that limit the choices available e.g. cash flow, human skills, resources etc.

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Rational Decision Making (2)• Every proposed alternative will fit the desired

solution equally well• A set of decision criteria should be determined to

evaluate the fit between the available options and the needs of the organization

• E.g A company decide to replace old unreliable equipment Decision criteria

Cost Limitations, required speed/accuracy of new machines, retraining requirements and installation costs

• So each alternative proposed has following characteristics Degree of risk in failing to meet decision criteria Development and installation costs Benefits to the organization

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The Seven-Step Operations Research ProcessI. Problem Form ulation

A . D efin e objectives of study

C . D efin e th e relevan t boun dar ies of th e system

B . D efin e m easures of effectiven ess an d efficien cy

1 . C on trollable var iables

2 . U n con trollable var iables

II. M odel construction

A . Specify

1 . V ar iables

2 . Param eters

3 . T h e rela tion sh ips betw een var iables an d param eters

4 . W h eth er th e rela tion sh ip is determ in istic or stoch astic

III. M odel va lidation

A . D oes th e m odel fu lfill th e purpose for w h ich it w as in ten ded?

B . D oes it p red ict th e rea l-w or ld beh aviour of th e system ?

C . A re assum ption s, va r iables, pa ram eters an d rela tion sh ips va lid?

D . E xper t eva lua tion

IV . D er ivation of solution

A . M ath em atica l

B . Itera tive

C . S im ula tion

D . E xper im en ta l op tim isa tion

V . E valuation of result

A . D oes th e m odel p rovide va lid in form ation for decision m akin g?

B . C om pare solu tion s w ith system beh aviour

V I. Im plem enting the m odel

V II. U pdate and revise the m odel

Problemform ula tion

Is th e m od e lva lid ?

D erive solu tion

M odelcon struction

A re th e resu ltsa ccep ta b le?

Im plem en t th esolu tion

No

Yes

Yes

• Operations Research grew out of successful application of hard systems approaches in WW2 (anti-aircraft fire & submarine detection and deterrence systems)

• Uses mathematical models to derive ‘algorithmic’ solutions to (usually routine) tactical problems

• Forms the basis of ‘management science’ approaches

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Types of Operation Research Problems

•Generally non-strategic and tactical in nature•Focus on efficiency improvement•Relies on classifying of problems by form

Form - relationships between properties of the problem

Content - nature or meaning of those propertiesSo while the OR specialist may not know the content of a particular job - it is assumed that the form allows essential problem characteristics to be understood and similar solutions applied

•Eight classes of OR problems Allocation Inventory Replacement Queuing

Sequencing and co-ordination Routing Competitive Search

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Types of Operation Research Problems

• Allocation problems Optimum apportionment of scarce resources

• Inventory problems Stock maintenance - optimum re-order point

• Replacement problems Asset maintenance - capital outlay vs maintenance

costs

• Queuing problems Optimal management of waiting lines

• Sequencing and co-ordination problems Sequencing - prioritizing waiting lines e.g.

hospital/maintenance triage

Co-ordination -arrange tasks to complete project on-time/cost PERT/CPM

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Types of Operation Research Problems

• Routing problems Determining optimal route in a network of locations

e.g. travelling salesman problem

• Competitive problems Characterized by ‘games theory’ - zero-sum games - only

one winner - non-zero sum games - possibility of other players benefiting

• Search problems Minimizes the search cost when a match between a

class of problem and a class of solutions doesn’t exist - allowable cost becomes a parameter of the search problem

OR deals with complex but well-defined problems that are operational rather than strategic - wider scale problems - SA

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Systems Analysis

• Five steps of Systems Analysis are: Problem Formulation

designed to clarify the goals and expectations of the client

identify constraints and obstacle that apply to project

Generating alternatives No identifiable guidance regarding this element relies on the creativity of the analyst

Forecasting future environmental states Forecast future events that may impact on alternatives Remains something of a black art

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Systems Analysis Identifying and evaluating the

consequences Each alternative has associated costs & benefits -

means must be found that allow tradeoffs between various alternatives to be evaluated

Future value of the alternative as opposed to current system must be indicated

Comparing and ranking alternative courses of action possibly the most difficult area - as each alternative has

its own associated costs and benefits - no common yardstick to determine best alternative

Advise using domain expertise to determine best alternative

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Iteration in the Systems Analysis Process

Form ula tin gth e p roblem

Iden tifyin g ,design in g an dscreen in g th ea ltern a tives

B uild in g an dusin g m odelsfor p red ictin g

th econ sequen ces

C om par in g an dran k in g

a ltern a tives

Forecastin gfu tu re con tex ts

Initiation

B o u n d a r iesa n d

co n stra in ts

O b jec tiv es

V a lu es a n dC rite r ia

A lte rn a tiv esC o n seq u en ces

( Im p a c ts)C o m m u n ica te

resu lts

Itera tion to recon sider th e con stra in ts, objectives or cr iter ia

Itera tion to im proveth e p red ictive

process

Itera tion to reform ula te th e p roblem

Itera tion to im prove a ltern a tives

• Systems analysis is somewhat unusual in that it generally incorporates iteration

• This allows any models developed to be continually checked against changes in the target system

• Introduces a ‘learning’ element into the process as each iteration produces new information or understanding of the situation

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Hard Systems Approaches - Summary

• Hard Systems Approaches represent one of several different means in the systems approach to management

• Attempts to develop economical solutions to well-defined problems - best result with minimum effort and cost Assumes all the necessary information is available Assumes that the end to be achieved is agreed

• In well-structured situations can produce very effective solutions

• Does not perform well in situations where the end to be achieved is less clear