Systems thinking for managing projects

Abstract

Abstract. Systems thinking is a discipline that has developed substantially over the last few decades but most project managers remain unaware of its potential power in helping analyse, refine and deliver their complex projects. In fact, over the past 30 years several hundred of the world's largest and most complex projects have successfully used the technology to improve their outcome. Traditionally, a time-consuming technique to implement, it has only been utilised for the most complex projects. However, these methods are fast becoming more accessible for large projects in general.Through modelling the rework cycle and the feedback loops that drive it, using system dynamics it is possible to analyse and hence improve the dynamic behaviour of our projects. In this paper we show how a system dynamics model of a project is constructed and used to assess project outcome. Examples of its application include: cost versus schedule trade-offs, project improvement strategies, risk assessment and assessing resource constraints. The ability to deliver such answers quickly and accurately during the bid and project definition phases provides the project management team with a powerful decision making tool for project strategy formulation. The improvement in project outcome that can be achieved at this stage of the project is massive because of the low cost of change combined with a high leverage into project commitment, risk mitigation and outcome that is available early in the project's lifecycle. WHAT IS SYSTEM THINKING?Introduction Systems thinking has its roots in the soft systems methodologies of Checkland and system dynamics analysis methods originated by Forrester (1961). Some people still dismiss these methods as being esoteric, imprecise or too "soft" for use in realworld applications, although in reality they have been used to great success on hundreds of the world's largest and most complex projects. Its applications have included: improving the accuracy of bid estimates, risk assessment and mitigation, optimising project strategy, improving the accuracy of progress monitoring and project reporting and in about 15% of the cases in resolving disputes arising from troubled projects. The applications have included complex projects in sectors as diverse as civil infrastructure, shipbuilding, aerospace, defence, railways, and telecommunications.We shall show that using a system dynamics approach to modelling the rework cycle and the feedback loops that drive it, makes it is possible to analyse and then manage the dynamic behaviour of our projects. This paper demonstrates how a system dynamics model of a project can be constructed and used to assess and manage project outcomes.In order to understand how system thinking can be applied to complex projects there are two concepts that need to be understood. First, the rework cycle and how it acts within complex projects. Second, the feedback loops which exist within projects that drive the project dynamics.The Rework Cycle. The majority of complex projects fail to deliver...

A review of the recent contribution of systems thinking to operational research and management science

“…The contribution of traditional OR to the subject is mainly concerned with techniques and tools to understand how the transformation involved in fulfilling the task can and should be handled in an efficient way, given the (often limited) resources at hand. Today projects seem to have become increasingly common in all kinds of organizations (Mawby and Stupples 2002). They are increasingly large, complex and constrained and may involve large numbers of interested parties and professional and technical disciplines.…”

“…It is being increasingly recognised that decisions and actions are neither necessarily sequential nor mutually coherent. Systems thinkers are contributing to the debate (Achterkamp and Vos 2007;Lyneis and Ford 2007;Mawby and Stupples 2002). In particular, Winter and Checkland (Winter and Checkland 2003), claim that project management in the future will provide a way for organizations to release the innovative forces within themselves rather than to plan.…”

“…They will encourage the means to enhance participation rather than to control. Systems thinkers are also contributing to theories on learning in projects (Achterkamp and Vos 2007;Howick and Eden 2001;Lyneis and Ford 2007;Mawby and Stupples 2002;Williams 1999a;Williams et al 2003b), i.e. theories on how project work causes learning at the organizational as well as the individual level, and how this learning can be made useful to the organization in subsequent projects.…”

“…However, in recent years many researchers have shown how systems thinking (in particular SD and SSM) can be the basis for analysing complex organizational operations, for example, in supply chain management (Ayers 1999;Beth et al 2003;Holweg and Pil 2008;Moon and Kim 2005;Rosen 1998), and project management (Costello et al 2002;Lyneis and Ford 2007;Mawby and Stupples 2002;Rodrigues and Bowers 1996;Rodrigues and Williams 1998;Winter and Checkland 2003).…”

A system dynamics approach to risks description in megaprojects development

“…It was designed to help decision-makers learn about the structure and dynamics of complex systems, to design high leverage policies for sustained improvement, and to catalyze successful implementation and change. In recent years, the SD has been used by researchers and project managers to understand various social, economic and environmental systems in a holistic view (Rodrigues 1996;Towell 1993;Sycamore 1999;Mawby 2002;Love 2002;Ogunlana 2003 andNaseena 2006).…”