The Viable System Model is based on the way that the human nervous system is structured and how it handles information
In the early years of Beyond Budgeting we uncovered more and more organisations that managed their business more effectively without budgets. Apart from being consistently successful, the most striking thing about them was that they had independently chosen to do the same kind of things. Why was this?
This started me on a quest to discover the source of the principles or management that they had intuitively adopted.
This led me to systems ideas and especially to the ideas of Stafford Beer whose Viable System Model was the subject of my PhD and the intellectual underpinning of everything I have done since.
It is difficult to overstate the profundity and importance of these ideas that few people know about and even fewer understand. My book, 'Zen and the Art of Organising Work' is my attempt to communicate these ideas in an accessible way, with our dumbing them down.
Making Forecasting Pay
One of the key insights from my work on Business Forecasting was that if you can’t define what success looks like then you shouldn’t be surprise if you fail. But having defined ‘success’ for business forecasting it was the pursuit of an answer to the follow up question: ‘how do know if we have achieved it?’ that led me to developing a completely novel approach to measuring the quality of forecasts.
It soon became clear that this approach would add most value to short term forecasting of demand because of the amount of forecasts that need to be produced and the clear and direct link between the quality of forecasts and impact on the business – the level of stock and the quality of customer service.
I cofounded CatchBull to develop software to exploit this technology and over time the concepts and techniques were refined and improved with the results being published in peer review journals. At the heart of this thinking is that the ultimate measure of forecast quality is the amount of value that the process adds to the business, rather than abstract measures based on simple error measurement.
CatchBull now has the only product in the market capable of analysing the value added by forecasting and helping practitioners to improve their performance.
Find out more in 'The Little Book of Operational Forecasting'.