When Systems Start to Fail

Monday, August 30, 2010 1:30

Over time, there are few things more important (and perhaps less appreciated) than a good old fashioned system that operates well.  Systems are something that anyone in supply chain, economics, or general management can appreciate (when running well), and in China where everything is about large numbers, the need for processes is unquestionable.

That, for their to be economic, environmental, political, and societal stability, systems need to be in place that ensure that the moving pieces of each system is sitting on a solid foundation of processes.  Stable, and safe, food systems. Environmental regulations that are enforced.  Health care systems that provide fair access to care.  Transportation systems that support the efficient movement of people and goods.  Systems that are grounded in processes, but processes that are dynamic enough to maintain their integrity when tested.

Over the last few years, many of China’s systems have seen their fair share of tests,and given the speed of growth that is needed, there are bound to be failures.  62km long traffic jams are created. Food safety scandals fail to really go away, housing bubbles are created and supported, energy shortages knock out power to China’s largest cities, water shortages force the movement of people, violence on the work site increases, land so on.

the problem now is, that these failures are becoming more frequent, are having a larger impact, and should be seen as larger signs that for all the talk about how good China’s leaders are at planning, their are now issues of processes and systems that threaten economic growth and environmental stability.  That, while China is great at putting together regular 5 year plans and putting into place sweeping changes, the fact is that many of these systemic changes are often weakened by local interests, bad data, and failure to develop processes.  Which, as we have all seen, can have catastrophic consequences.

Lately, some of the more recognizable signs of failures are in 62km traffic jams, in labor disputes, or in the widening gap between the sexes, but more troubling for me are the ones that I would consider core to China’s ongoing concern.  issues within China’s ability to deliver the food, water, and energy that its economy needs to continue growing, issues that are rooted in inefficient processes of extracting, processing, and transporting resources and allocating assets.

It is an issue that goes far deeper than designing some magical traffic busting bus, and cannot be regulated, and for the average manager in China it is jsut something that needs to be effectively planned for, anticipated, and managed.

Systems.  love ’em or hate ’em they exist.  The only question is whether your goods will be 58km into the traffic jam, or if you will have developed strategies that maintain their integrity when the circus comes to town.

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3 Responses to “When Systems Start to Fail”

  1. Renaud says:

    August 30th, 2010 at 9:03 pm

    For some reason, the Chinese don’t seem to be good process thinkers. I know it sounds a little insulting, but that is my explanation for the lack of interest of factory managers in improving their organizations. They prefer to work at the margin (pushing workers to do more, receiving larger orders, getting discounts on components, often doing less than promised…). 

  2. Ashley Hall says:

    August 31st, 2010 at 1:31 pm

    Thanks for the insight on the idea of systems, Rich. You definitely have a valid point. Even if China has grand and great ideas on how to improve and evolve, they cannot make any real progress without efficient and reliable systems in place.

  3. author wanglili says:

    September 1st, 2010 at 9:56 pm

    system itself never can make a success alone.