From the Summer 1995 issue of the Complexity Management Chronicles
Peter Senge, author of "The Fifth Discipline - The Art and Practice of The Learning Organization", spoke at an MIT alumni/ae event this past winter. His presentation focused on how system dynamics principles can help solve highly complex problems, like software development. He illustrated this with an example about Ford Motor Company. Working with the MIT Center for Organizational Learning, ("The Center"), Ford achieved significant successes in terms of timeliness, staying within budget, and quality when developing the new Lincoln Continental. We believe an awareness of system dynamics principles can favorably impact the costs, timeliness, and quality of your software deliverables.
First, let us provide some background on the project. The budget for this new car was $2 billion over 5 years. 300-1000 people worked on this project at any given time. The Center began working with Ford in September of 1991, about two years into the project. The Center created the "New Car Development Learning Laboratory" as a teaching mechanism. The Lincoln Continental went into production November 30, 1994.
The collaboration between the two produced the following results. Near the end of development, a tent city would be erected where engineers would live for six to eight months, working long hours, to iron out any kinks with manufacturing. However, this project team dismantled their tent city after only two weeks due to a well-orchestrated installation. Ford had never experienced such rapid progress through this part of the process.
The manufacturing division gave the development team a quality award because the transition from design to manufacturing was so smooth and the quality so high.
New cars routinely missed their deliverable dates. The Lincoln arrived on the showroom floors, on time.
Ford top management created a contingency fund with $85 million to cover any late breaking glitches. Project management returned $65 million of the fund because the process had run exceptionally well.
How did this collaboration produce such dramatic results? The Center helped Ford see the larger field of interdependencies. They taught that quick fixes mask the need to deal with complex, interconnected, problems. Often with quick fixes, one group solved their problem but ended up creating a problem for another group. Once the Ford team understood this, they resolved issues with significantly fewer, if any, negative side effects.
What did this collaboration cost Ford? Upper management already met for one day a month to review issues. The Center extended the meeting to two days per month. They used the second day to reflect upon what had happened in the management meeting, to build trust, and to develop shared insights. Additionally, they trained managers at all levels of the Ford hierarchy in system dynamics.
How can you reap similar results?
Read "The Fifth Discipline - The Art and Practice of The Learning Organization" published by Doubleday. (The "Shifting the Burden" archetypes in the appendices have particular relevance to QA.)
Have your organization become a corporate sponsor of the Center for Organizational Learning at MIT. Becoming a sponsor entitles your company to many benefits, such as access to papers, conferences, etc..
Complexity Management has adopted the principles of "The Fifth Discipline" for improved decision making. If interested, we would be happy to discuss this important book with you.
©Complexity Management 1995
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