The Principles of Systems Thinking…
- Holistic: the total is more than the sum of its parts; relationships and processes are key
- Open: constant stimulus from the environment into the system
- Boundaries: it is important to define the product category and the market correctly
- Input – Transformation – Output: a “Cause – Action – Effect” flow-through
- Feedback: Outcomes always feed back into the system; continuous loop effect
- Multiple Goals: entails a set of objectives; avoids “either / or” thinking
- Differing Approaches: different paths can address same the goals
- Entropy: all systems tend towards chaos; if you don’t reverse this, the system dies
- Hierarchy: made up of subsystems; e.g. consumer - market – product - brand
- Interrelated Parts: made up of components existing in a relationship with each other
- Dynamic Equilibrium: “steady state” i.e. constant change / energy keeps the system alive
- Complexity: the system characterized by differentiation, elaboration and detail
Why Systems Thinking is necessary in Brand strategy…
- Strategy is driven by goals e.g. value, momentum, growth
- Flexibility and adaptability is a necessary ingredient to strategy
- Strategy works “from the outside in” – consumer to market to product to brand
- Systems are all about relationships between parts; so is strategy
- Systems are linked to other systems: the business, the value chain, the financial system, to name a few
- All systems require constant energy, otherwise they tend towards decline or death
- Constant change (energy input) always carries risk
- Problems usually have multiple impacts – solving one can automatically solve others
- Root causes and their effects are not closely linked in space and time – solutions often lie far from the problem
- Problems cannot be solved at the level they were created – complex problems cannot be solved by simple solutions
COMPONENTS: WHY MARKETSCAPE IS A SYSTEM