Tuesday 20 February 2007

My mphil proposal of work for using managerial cybernetics to explore business strategy


Greetings and welcome once again to this, only my second ever forage into blogspace.

To quickly summarise my reasons for blogging in case this is the first time you've encounted the stafford
beer meets business strategy blog, I have decided to write this blog to document, discuss and hopefully expand on an mphil proposal I submitted to Liverpool John Moores University just over a year ago.

Various and wide ranging circumstances have dictated that I am no longer pursuing the research proposed but I hope that through this blog I can go some way to resurrect my research interests and keep the topic alive and current. In the grand scheme of things I can then hopefully pick up my research interests in this area with an academic institution and fulfill my commitment to researching in this area.

So, as promised in my first ever blogging experience, here is my outline proposal of work. Again, my aim for this blog is to show open my thoughts to the outside world and welcome feedback. Therefore please feel free to comment on this post, its contents, thoughts, theories and assumptions. The entire blog is a work-in-progress and designed as a learning experience for myself, as well as hopefully widening the audience for what's a relatively contemporary area of business thinking (the Stafford Beer stuff more so than Business Strategy!).

Background

This research proposal is developed from the work undertaken by the author’s KTP programme at Salt Union Ltd.; in particular the designing and implementing of the Exactrak value added business. The proposed research is to be part-funded by Salt Union and as such has their full endorsement and co-operation.

The background subject areas for the research are structured into two strands: that of Business Strategy and Managerial Cybernetics, as outlined below.

Context

Salt Union Limited and Exactrak

Salt Union is a wholly owned subsidiary of Compass Minerals with four businesses operating out of its site in Winsford, Cheshire. Exactrak is one of those businesses.

Exactrak is a unique web based, real time tracking and monitoring system for local authority municipal vehicles. It provides detailed real time information about the operations of a fleet helping to ensure high service standards and maximum cost efficiencies (www.exactrak.co.uk). As suggested by Moffat (2005), Exactrak’s bespoke nature aims to deliver the technology that allows local authorities to best manage their fleets. ‘Most local authorities have large fleets to manage, and are under increasing pressure in all areas to ensure best practice and high service levels…up until relatively recently, there was nothing which was designed specifically to monitor the activity of all the vehicles in a local authority fleet’.

Business Strategy

It is expected that the Business Strategy component of the research will focus primarily on the works of Porter (1980) and his Five Forces Model, Kaplan and Norton’s Balanced Scorecard (1996), Strategy Maps (2004) and the Office of Strategy Management (2005) in addition to Johnson and Scholes’ (2004) work with Corporate Strategy. Also considered will be Hamel’s (1994) work on competing for the future and Robson (1997) and Earl (1989) in the field of Strategy and Information Systems.

Porter (2004) suggests that ‘the essence of formulating competitive strategy is relating a company to its environment’. This is an important part of Business Strategy and also an important notion in the field of Managerial Cybernetics.

Managerial Cybernetics

The Viable Systems Model (VSM) was developed by Stafford Beer over a 30 year period, building on the works of Norbert Wiener (1948), Warren McCulloch and Ross Ashby (1956) in the field of cybernetics. Beer’s (1981) book The Brain of the Firm reflects the development of his thinking in the field of managerial cybernetics and reports the application of the VSM in the Chilean Cybersyn project. This is considered a cornerstone project in the development of managerial cybernetics and the VSM. Beer (1985) believed that “an organisation is viable if it can survive in a particular sort of environment…it can not survive in a vacuum”. His model seeks to determine the viability of organisations, allowing them to adapt in order to survive.

Beer’s model, as a tool to assess viability, has been continually developed and its use has widened to areas such as the designing of management systems in software design and the management structures in organisations. Heemink et al. (2001) use the VSM as “a basis for the management system within an agent-based simulation platform that will evaluate management concepts”. It is a novel application of the traditional concept of viability that this study intends to follow.

Espejo (2003) describes it [the VSM] as “offering a holistic form of observing collective behaviours in today’s societies”. He continued to work with the VSM and the development of the theory with Roger Harnden (1989). Based upon Espejo’s individualistic interpretation on the VSM as “observing collective behaviours in today’s societies”, the structures in place within system 5 of the VSM and the importance of the system 3-4 homeostasis are to be researched to identify whether these elements and the remainder of the model can be used to identify, determine and evaluate business strategy.

Link between research areas and case study

Beckford (2002), states that ‘every venture has a fundamental reliance on human input for control and development’. It is therefore critical for an organisation to ensure that human input is guided in an effective way. Organisational Cybernetics [also known as Managerial Cybernetics] is defined by Beer (1985) as ‘the science of effective organisation’. For an organisation to be effective, it is considered necessary for the organisation to be viable – able to survive in an environment. In order to survive and be viable, an organisation operates under a set of guidelines that have been identified to ensure survival. This can be considered as the business strategy. Therefore it can be suggested that business strategy is a subset of viability, and that the two are implicitly connected. Within the VSM, the key notion is that of intelligence: a function used to explore the environment and inform decision making. This principle can also be applied to a business strategy. In order to control human input an organisation must operate in a viable environment. This can, in part, be achieved through an effective business strategy.

This research intends to explore how managerial cybernetics and the VSM can inform business strategy in order to deliver improvement into a business environment [Exactrak].


Methodology


The methodology the research intends to follow is a combined qualitative and quantitative approach. Wisker (2001) suggests that ‘qualitative research is carried out when we wish to understand meanings, or look at, describe and understand experience, ideas, beliefs and values’. This approach will be used in the research methods below to determine current practice through interviews with key Exactrak executives. A qualitative approach will provide the flexibility to accommodate subjective perspectives and personal ideas, beliefs and values that comprise a composite value set. A quantitative approach will then be used to collate and record information collected through the quantitative research.

To provide a holistic overview to the combined research methodology, the research will use the principles of the Hypothetico-Deductive Method as outlined by Sekaran (2003). Although predominantly a scientific approach, its structure of observation, preliminary information gathering, theory formulisation, hypothesizing, further scientific data collection, data analysis and deduction is suitable to the structure of this research.


The following research methods are to be used within the research:

  • Literature Review
  • Identify and analyse company documentation
  • Determine current practice in respect of current business strategy, within Exactrak through interviews with key Exactrak executives
  • Analyse the current business strategy in the light of current Business Strategy thinking and the application of Managerial Cybernetics
  • Develop a framework, based upon the analysis, to deliver change to Exactrak
  • Test the framework within Salt Union and Exactrak to ascertain the relevance of the framework to delivering an improved business strategy

Literature Review

An initial literature review has already taken place as part of this research proposal (see ‘context’ section). The review will form the basis for a full literature review that will follow the proposal.


Hart (2000) suggests that a literature review is undertaken using ‘a range of techniques that can be used to analyse ideas, find relationships between different ideas and understand the nature and use of argument in research’. The review will use these principles while reviewing the available literature for the fields of Business Strategy and Managerial Cybernetics. It will also look at the Viable Systems Model developed by Stafford Beer (1984) and the work of other prominent authors. The review will also investigate a number of other fields of research; notably that of change management and research methods.


Outcomes

The expected outcome of the research is to primarily understand how Managerial Cybernetics
and the Viable Systems Model can be used as tools for understanding and creating Business Strategy. Through successful completion of the research, an evaluation into the efficacy of the current business strategy in Salt Union and Exactrak will be completed, enabling the development of a VSM-based approach to facilitate a re-configuration of the Exactrak business strategy, reflecting the enhancements available as a result of the research outcomes.


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Next post: One year on, where am I now...

Thursday 8 February 2007

Using Managerial Cybernetics to explore Business Strategy

Hello and welcome to my Blog.

My name is Ben Chadwick and I am writing a blog to document, discuss and develop an mphil proposal I submitted to Liverpool John Moores University a year ago now, but due to external commitments I have not been able to follow through with.

The purpose of my blog is to submit my proposal to the outside world and gradually update the proposal with completed sections of my research plan. My thinking is that through the occasional updating of this blog I can keep a toe in the research world and keep my mphil proposal simmering on the back burner of my often hectic life, in the ever hopeful event that I can resurrect my research with an academic institution at a future date.

So without further ado, please have a look at the headlines of my proposal below. I will endeavour to update with as much detail as possible over the coming weeks:

TITLE:

Using Managerial Cybernetics to explore Business Strategy

AIM OF THE INVESTIGATION:

Investigate the use of Managerial Cybernetics and the Viable Systems Model as tools for Business Strategy

OBJECTIVES OF THE INVESTIGATION:

  • To identify current approaches to the formulation of Business Strategy
  • To seek insights into how Managerial Cybernetics might inform Business Strategy
  • To identify approaches to business strategy in Salt Union and Exactrak
  • To consider Exactrak’s current business strategy in the context of insights from 1 –3 above
  • To deliver change into Exactrak and determine key principles for future research

N.B. Exactrak is real-time GPS tracking system for Municipal vehicles developed in partnership with Salt Union Limited and Liverpool John Moores University through the DTI Knowledge Transfer Partnership (KTP) programme. The author of the research [that's me!] was, and still is, the Project Manager for Exactrak. The Exactrak business is the case study for the research.

Please feel free to comment on any aspect of this blog. In particular I would be interested in opinions of the proposed research, from anyone carrying out / intending on carrying out similar reseach, or anyone from the Stafford Beer school of thought.

BC

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Next blog: Proposal of Work (to include Background, Context, Methodology and Summary Literature Review)