John L Jerz Website II Copyright (c) 2014

New Business Models: A Closer Look at Sense and Respond (Arteaga, 2000)

Home
Current Interest
Page Title

Joe Arteaga

http://www.senseandrespond.com/downloads/EDGE-S_R_Model_application-JArteaga.pdf

p.1 Steve Haeckel's Sense-and-Respond model is an opportunity for organizations in the knowledge-based economy to shake off the restraints of the industrial business model of forecasting and predicting customer needs. He proposes that the only strategy that makes sense is one where the enterprise is organized to be adaptive.

p.1 Although the concept of the words "Sense and Respond" can be easily thought to mean that people in organizations must be open to change so they can react quickly, the Sense-and-Respond model deals much more with large-scale organizations knowing earlier what the change in their environment means, so they can pre-empt and respond appropriately. The Sense-and-Respond model prescribes enterprises designed from customer requests back, not based on planned responses to forecasts about the future.

p.5 Adaptiveness

A Sense-and-Respond system is by definition, open and adaptive. The definition of the context mandates that signals on how the context is doing be received to enable redesign if necessary. It must be open to be adaptive, as environmental signals are the system's main source of information for appropriate responses to change. This feedback model follows the basic characteristics of any successfully adapting system by leveraging two types of feedback:

  • Operational -- are the signals created by the interactions of the people in roles in the Coordination of commitments to create outcomes for customers

  • External -- signals from outside the organizational bounds which are available as data or signals for sensing and interpretation

p.5 Steve Haeckel describes the generic adaptive loop called SIDA, which all adaptive systems must be able to cycle quickly through to make appropriate responses to rapid change. The SIDA loop is broken down in to the following components: Sense, Interpret, Decide and Act. A person in a role will need to cycle through this loop at the speed which the environment warrants.

p.6 Creative people tend to rely on latent knowledge - to which they don't have conscious access.