The Problem Situation In Systematic Thinking Commerce Essay Example
The Problem Situation In Systematic Thinking Commerce Essay Example

The Problem Situation In Systematic Thinking Commerce Essay Example

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  • Pages: 10 (2659 words)
  • Published: July 26, 2017
  • Type: Case Study
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This paper aims to analyze BAJ jobs using systems thinking. It will start by presenting a job scenario and then examining metaphors and paradigms that offer diverse perspectives on organizational analysis. Moreover, it will utilize SOSM as the suitable system methodology. Additionally, a comprehensive explanation of the lean system will be given to tackle and resolve the identified issues.

Problem Situation

Bank Al-Jazira (BAJ) was established in 1974 and, despite being the smallest bank in Saudi Arabia, it has been the leading bank in the Saudi Stock Market for the past 8 years. In 2006, all banks were required by the Saudi Arabia Monetary Agency (acting as the central bank) to subsidize investment activities under the Capital Market Authority's regulation. This led to an influx of competitors entering the market. Consequently, BAJ has faced several challenges in maintaining its mar

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ket share (Figure 1). The primary issue is its inability to offer quality services that attract new customers. For instance, TadawulCom, which is the most popular internet trading system in the market, accounted for approximately 35% of BAJ's profits in 2007 but only around 19% in 2009.

This job is recognized when the clients first come and have to wait for services. Customers demand more services and merchandises in less clip, less attempts and at a good monetary value. So, BAJ should understand clients' demands in order to increase efficiency.
C: UsersMajed Al ThagafiDesktopMarket share.jpg

Metaphors and Paradigms

Flood and Jackson (1991) explained that in order to understand how work works, we should understand metaphors first. As Morgan (1986, p.13) explained why we need that? "We use metaphor whenever we attempt to understand one component of experience in terms of another"

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Thus, "metaphors are extremely good at allowing us to explore our own world view and to assist with creative thinking" (Jackson,2003, p.33).

In his work, Jackson (2003) identified nine metaphors that can be used to understand organizations: machines, beings, encephalons, flux and transmutation, cultures political systems, psychic prisons, instruments of domination, and carnivals. According to Jackson (2003, p.38), without combining creative paradigms with metaphor creativity, it would be too simplistic to select a set of metaphors that align well. As a result, Jackson identified four paradigms that have an impact on organizations: functionalist, interpretative, emancipatory, and postmodern paradigms.

The functionalist paradigm is used to understand how each portion in the system works by utilizing scientific direction in order to make a high degree of efficiency, effectivity, endurance and version, while the interpretative expressions for reading between people in order to portion corporate civilization and increase committedness and working life quality. BAJ has jobs in the functionalist paradigm, which will be considered in the undermentioned paragraphs, including machine, being and encephalon metaphors ( Figure2 ) .

Machine metaphors:

In the 1910s, Talyorism and bureaucratism emerge, which identified a specific map by utilizing everyday and standard activities in order to accomplish more efficiency. This efficiency is measured by accomplishing predetermined ends and is the most extremely valued property. As Jackson (2003, p.34) said, "It represents organisations as rational instruments designed to accomplish the intents of their proprietors or accountants".

The main shortcomings of the organization are that focusing on fragments gives the organization a limited perspective on individuals rather than considering the whole aspect. The use of policies and procedures, along with specific communication channels that could make the problems worse,

creates a closed system. Furthermore, this type of organization tries to identify job descriptions and associated responsibilities, leading employees to think selfishly like "It's not my job to worry about that" or "this is his duty, not mine" (Morgan, 1986). As a result, neglecting individuals is acknowledged in this organization (Jackson, 2003). There are several indicators that BAJ embodies the machine metaphor, such as setting annual targets at the beginning of the year and management using them as the basis for performance evaluation.

TadawulCom has a simple and persistent process. BAJ is seen as a stable environment because everyone has a clear goal.

Organism Metaphor:

Many authors, including Morgan (1986), Jackson (2003), and Flood and Jackson (1991), explain that the organism metaphor views the entire organization as a whole. It is the concept of an open system in which its components work together to survive by adapting to environmental changes. According to Jackson (2003, p.34), the management style "pays close attention to the demands of the environment and ensures that subsystems meet the organization's needs."

The concept of Human Relations theory and its impact on organizations is discussed in the text. According to this theory, individuals are crucial in driving an organization's success by motivating them to work efficiently. However, critics argue that individuals and groups may not always have the same goals as the entire organization. Moreover, focusing on adapting to change instead of growth can cause conflict between different departments. In relation to BAJ, this metaphor suggests considering two important factors: the environment and customer demand. Both these factors are vital for BAJ's survival and necessitate adaptive measures from the organization.

Brain Metaphor:

According to Jackson (2003), the brain metaphor emphasizes active learning and control, with decision-making, information processing, and control being the most influential factors. Flood and Jackson (1991) suggest that this type of organization strives to achieve its goals through learning, creativity, innovation, and group work. The brain metaphor is applicable in some sections of BAJ, such as R and to some extent in the client services section. Thus, there are two aspects to consider: increasing efficiency through the dominant machine metaphor and meeting customer demands through the adaptable being metaphor.

System of System Methodologies ( SOSM )

The development of a system of systems methodologies aims to examine the interconnectedness between different methodologies and their effectiveness in solving real-world problems (Jackson and Keys, 1984, p.473).

According to Jackson (2003), SOSM is a simplified framework for understanding the complexity of systems and the diversity of participants interested in the situation (Table1.0). The framework categorizes participants into three types based on their values, beliefs, and interests. Unitary participants share the same values and beliefs, resulting in agreement without arguments. Pluralist participants, on the other hand, aim for consensus but often engage in lengthy arguments due to differences in their values and beliefs. Coercive participants rely on power to make decisions and frequently experience conflict due to strong values and beliefs. The framework also divides systems into two types: simple systems with a few stable sub-systems over time.

The level of integration between sections is low. Complex systems are composed of multiple highly integrated parts. Analyzing BAJ, it is evident that the participants are unified as they share the same values and

beliefs to achieve their one-year goal. However, the system in TadawulCom is not very complex, mainly due to the involvement of only four sections.

As mentioned above, TadawulCom is the main concern in BAJ that will impact the entire organization. Therefore, the most useful methodology to use is the Thin System methodology in order to increase efficiency, which affects the whole organization and achieve customer satisfaction as "LS can provide efficiency gains and improvements in service performance, customer satisfaction and staff morale".

Thin System Methodology

Thin overview

The Thin System translates TOYOTA's approach from manufacturing industry to service companies (Vanguard,2009). Toyota approach was developed to produce vehicles to meet customer demands by understanding their ability.

The measurement of capacity was undertaken to better understand the relationship between mark and public presentation, as described by Ohno's axiom, capacity = work + waste (Gregory,2007). Therefore, Seddon's approach aims to redesign the procedure to enhance services and decrease costs by reducing waste. According to Gregory (2007, p.1508), managers should focus on eliminating failure demand and improving the system as a whole to enhance customer experiences. The thin system focuses on the entire system from the customer's perspective, which includes a final step process to achieve customer satisfaction. This system consists of three phases.

, consider, design and implement.

Stages of the Thin System

Check Phase:

Seddon (2008) emphasized the significance of this phase as it helps managers understand the "what and why" of the system's current performance from the perspective of the clients. It takes time to observe and comprehend how the work functions. He outlined five steps to comprehend the "what and why":

Step 1: Purpose

of the Product

This step involves identifying our products from the clients' viewpoint and the current system (Seddon, 2008; Jackson et al., 2008). TadawulCom is an Internet trading system that aims to offer the appropriate products for easy and fast trading to the right customers with excellent service as quickly as possible. The entire TadawulCom process (end to end) consists of three stages (Figure4), starting from customers through the request process until the delivery stage.

Measure 2: Types and Frequencies of Demand

According to Jackson et al. (2008), it is essential to differentiate between 'value demand' and 'failure demand'. Seddon (2008) explains that this differentiation is important for understanding fluctuations and identifying factors that cause delays in the process. Value demand refers to the core service that BAJ should provide to its customers, while failure demand refers to any requests that do not meet customers' needs initially. TadawulCom offers two channels for providing services to customers - client services and the internet (online). Additionally, a call center is available as a support tool for customer inquiries and tracking requests. It is evident that 40% of our demand is value demand, highlighting the need to understand the process and study projected demand in order to develop a process that aligns with customer needs.

However, a significant portion of both channels (approximately 60%) is made up of failure demand. There is a need for further improvements in order to address issues such as form fulfillment, order tracking, and activation date clarity for customers to reduce wasted time. International trade is seen as a predictable demand.

Measure 3: Evaluating system responsiveness to demand

This measure involves assessing the

current system's response using a capability chart (Seddon, 2008). Figure 6 displays the range of responses our system provides to customer requests.

It was unclear whether our response had problems because our goal was achieved. For example, in case number 8, the system was down and no one knew what to do. Additionally, competitors put pressure on us to lower our score in order to meet customer satisfaction. Gregory (2007, p.1509) stressed the importance of considering the customer as a system boundary. Therefore, the challenge is to modify system capabilities based on customer demand and competitors in order to minimize variability.

Measure 4: Analyzing flowC: UsersMajed Al ThagafiDesktopCapability

Function is very important at this stage.

According to Seddon (2008), it is a mistake for directors to directly proceed with mapping without first analyzing demand and performance. The current flow (Figure7) demonstrates why BAJ tends to take steps that indirectly impact performance by introducing waste. It illustrates the progression of customer requests through the system, highlighting both the mapping and processing procedures involved. There are three possible paths that customers can take (Table2). The majority of database clients are those who request fee reductions, while 32% proceed directly through the efficient steps. However, the capacity chart (Figure6) indicates an average of 1.5 days, compared to the target of 45 minutes. As a result, the primary system should prioritize delivering value to customers, with the remaining factors being considered as waste.

The main goal of the system is to target TadawulCom to the correct customers; however, the process of reducing fees leads to delays in the procedure.

Step 5: Understanding system conditions

To identify the waste generated by the system, it is important to

understand our system conditions, including steps, functions, and processes. BAJ's managers believe that using the target as a measurement is the most effective way. However, if they want to improve the system, they should not overlook the possibility that the target and other measures could be causing sub-optimization.

Redesign Phase: "Plan and Make":

Both the 'Plan' and 'Do' phases are considered as redesign phases in the thin system rhythm (Jackson and Gregory,2008). In this phase, the purpose is to revise the intent of the system and identify, test, and implement possible alterations to meet the revised intent, according to the ODPM study (2005, p.37).

Revised Purpose

Rethinking plays a crucial role in enacting change and measuring performance (Jackson et al., 2008, p.191). Hence, our new purpose is not only about selling products that add value to customers from their first purchase but also establishing a strong commitment with them for long-term customer loyalty.

Principle of redesign

This advice is for future changes, which includes supporting the new vision by redesigning TadawulCom to meet customer demand and compete with rivals. The focus is on creating value and minimizing waste. Keeping customers informed is important, as a second call from a customer is considered a failure. Utilizing IT and CRM can improve communication between departments.

The purpose of the system in the program phase is to plan an appropriate system that focuses on the client's demands. The flow chart in Figure 8 shows that this will be achieved by increasing efficiency, reducing fees, and providing the same price to all clients. This will lead to a reduction in complaint calls and overhead work. The

system will retrieve client data from the system, eliminating the need for clients to fill out a form and reducing waiting time. Relationship Managers will have more authority to deal with clients, reducing waiting time for branch managers to review. The system will generate TadawulCom UserID directly, reducing inquiries about website registration. In case of system failure, there is an emergency plan that allows for manual service provision. Measures have been established to evaluate performance against the revised purpose. (Jackson et al., n.d.)

, 2008, p.192) states that the Quality Control Department measures new system's ability to achieve client satisfaction by measuring customer satisfaction over time and the number of incomplete requests on the first attempt.

Redesign experimentation

This measure aims to address issues that arise from both the work makers and clients (Jackson et al.,2008, p.192). It focuses on investigating whether the redesign is effective, identifying any problems that arise, and assessing how well it integrates with the rest of the system (ODPM,2005, p.40).

Therefore, it is important to consider certain issues as barriers. For example, there is an expected increase in demand which requires preparation to avoid misunderstandings and ensure work is done correctly from the beginning. A solution for the TadawulCom signifier is to work with the legal department.

Redesign - Changes in management

Attitudes and perspectives of staff who are not directly involved also need to be managed carefully. Managers should understand and accept the changes by thinking differently and supporting employees in order to achieve customer satisfaction. "To align the organization's roles, measures, structures, and support processes to the identified work value."

Criticism of the Lean System

Several authors, including Seddon (2008), Jackson and Gregory (2008), and Gregory

(2007), have addressed certain criticisms.

First, the thin system neglects clients with conflicting demands and prioritizes functionality over studying culture or politics. Utilizing the thin system could potentially reduce the system's capabilities.

Decision

This assignment has clarified the metaphors and paradigms associated with BAJ jobs (such as losing market share) in order to enhance efficiency and improve performance.

However, if the BAJ increases in size, it becomes necessary to refer to historical political relations as a metaphor. This will help reduce conflict among employees and enhance their understanding of each other with the aid of SSM systems. By using the SOSM approach, TadawulCom's issues with BAJ were analyzed through the three phases of 'Check', 'Plan', and 'Do'. It is evident that there is significant waste in the current performance, which can be eliminated through thin system methodology to ensure customer satisfaction.

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