TB871: Managing the ‘inside and now’ of the Viable System Model (System 3)

Note: this is a post reflecting on one of the modules of my MSc in Systems Thinking in Practice. You can see all of the related posts in this category. 

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So far, I have defined System 1 and System 2 of the Viable System Model (VSM). This post is focused on System 3, which Stafford Beer referred to as “managing the inside and now.”

System 3: Management of Delivery — Concerned with the internal management functions that oversee and control the operations. It includes activities related to allocating resources, setting performance targets, and ensuring that the operational units meet these targets. It acts as the supervisory layer ensuring efficiency and effectiveness.

Taken from TB871: The five systems of the Viable System Model (VSM)

There are actually two parts to System 3: the coordinating function of System 3 itself, and then System 3* (“three star”) which is the auditing mechanism. It’s important to note that VSM is not a hierarchical system, so although we’re talking about coordination, we’re not necessarily talking about ‘management’ in the usual top-down sense.

As the above diagram attempts to show, System 3 is responsible for several important tasks:

• Allocating resources: System 3 distributes resources such as budgets, staff, and equipment to various operational units. This ensures that each unit has the necessary tools to achieve its goals. Allocating resources effectively involves balancing the needs of different units, managing constraints, and optimising the use of available resources.
• Monitoring performance: This involves overseeing the performance of operational units by setting performance standards, collecting data, and analysing results to identify areas for improvement. Regular monitoring helps in maintaining high standards and addressing any issues that arise in a prompt way. Performance data can include metrics such as productivity, quality, and efficiency.
• Implementing policies: System 3 ensures that the policies set by System 5 (the policy-making function) are implemented across the organisation. This involves translating high-level policies into actionable plans for operational units. It may require developing procedures, setting deadlines, and ensuring compliance with standards set by the organisation or regulatory bodies.
• Resolving conflicts: Addressing conflicts and discrepancies between operational units is another critical function of System 3. This involves mediating disputes, negotiating compromises, and finding solutions to maintain harmony and efficiency within the organisation. Effective conflict resolution can prevent disruptions and promote a collaborative working environment.

In terms of System 3* this is an independent component which performs checks and balances to ensure that the information provided by operational units is accurate and reliable. It helps maintain transparency and accountability within the organisation by performing audits which can uncover discrepancies, inefficiencies, and areas where improvements are needed.

All five systems of the VSM are important, but System 3 is crucial as it links Systems 1 and 2 with Systems 4 and 5:

• Systems 1 and 2: System 3 receives data from System 1 (primary operations) and System 2 (coordination system), processes this information, and makes decisions that affect the operational units.
• System 4: System 3 provides feedback to System 4 (development & planning system), which deals at the external environment. This ensures that current operations align with future strategies. System 4 scans the external environment for opportunities and threats, and System 3 ensures that internal activities are adjusted accordingly.
• System 5: System 3 implements policies set by System 5 (governance system). System 5 is responsible for the overall direction and strategy of the organisation. System 3 translates these high-level policies into detailed plans and actions for the operational units.

Applying System 3 to my System of Interest

My system of interest is “a system to promote lifelong learning” in a library setting. When we consider System 3 in this context, it plays an important role in ensuring that all operational units (System 1s) work towards the common goal of encouraging lifelong learning.

System 3 oversees:

• Allocating resources: This involves distributing resources such as books, digital materials, staff, and funding across different departments and branches. Each unit needs the right tools to run programmes and services effectively. For instance, budgeting for new acquisitions in digital learning platforms or educational workshops is part of System 3’s remit.
• Monitoring performance: Keeping an eye on the performance of various units is crucial. This includes setting standards, collecting data, and analysing results to identify areas for improvement. Regular monitoring ensures high standards are maintained and issues are addressed promptly. Data might cover metrics such as book loans, digital resource usage, and feedback from patrons.
• Implementing policies: System 3 translates the library’s strategic policies into actionable steps for operational units. This includes enforcing lending policies, usage guidelines for digital resources, and procedures for community engagement, ensuring consistency and adherence to strategic objectives.
• Resolving conflict: Addressing conflicts that arise within the library is another key task. This involves mediating disputes between staff, resolving issues with patrons, and managing conflicts of interest between departments. For example, balancing resource allocation between the children’s education programme and adult learning workshops falls under this function.
• Optimising operations: System 3 works continuously to improve and streamline library operations. This might involve adopting new technologies, refining processes, and implementing best practices to enhance efficiency and service quality. For example, introducing automated check-out systems or optimising the cataloguing process can significantly improve the user experience and operational efficiency.

System 3* acts as an audit mechanism, and involves several activities:

• Independent Audits: Conducting regular reviews to verify the efficient and effective use of resources. This might include financial audits, assessing the impact of educational programmes, and ensuring compliance with library policies. For instance, checking whether funds allocated for digital resources are used appropriately and deliver the intended educational outcomes.
• Transparency and Accountability: Providing an unbiased assessment of the library’s operations helps maintain transparency. Regular audits identify discrepancies, inefficiencies, and areas needing improvement, ensuring high service standards and accountability to patrons and stakeholders.
• Feedback for Improvement: Audit findings offer valuable feedback to System 3, informing decisions and guiding necessary changes to improve services. For example, if an audit finds a particular educational programme under-utilised, System 3 can explore the reasons and make adjustments to enhance its effectiveness and appeal.

Together, System 3 and 3* create a structured framework supporting the library’s mission to offer high-quality, lifelong learning opportunities to the community. The interaction between System 3 and other systems ensures a holistic approach to managing and improving library services, helping align day-to-day operations with strategic objectives, whileadapting to external changes.

References

• Hoverstadt, P. (2020). ‘The Viable System Model’. In Reynolds, M. & Holwell, S. (eds.) (2020). Systems Approaches to Making Change: A Practical Guide. London: Springer, pp.89-138.