The Systems Thinker Blog

10 Reasons Why Your Business Systems Fail!

Posted byRon Carroll

Poor performance and frustration within an organization are symptoms of broken systems or processes. A law of physics (entropy) states that all things, including business systems, naturally tend to break down over time.

You will periodically need to repair, improve, or elevate a business system—or components used by the system—to a higher level of functioning. For example, the carpenter struggling to cut wood could sharpen the saw blade, buy a new blade with carbide tips, or even replace the saw with one that has a more powerful motor. Each solution takes him to a higher level of performance.

Sharpen the Saw Blade

Stand back for a moment and look at your under-performing system. Have you made any faulty assumptions? It is possible that your understanding of either the problem or the solution is wrong? You may need to re-examine your logic, or perhaps drill-down to find the root cause of the problem; the apparent cause is frequently incorrect.

Discover the Cause of System Failure

Below are ten possible reasons for the breakdown of business systems or processes in your organization:

  1. Managers do not have sufficient customer or worker input during the system development process. (You haven't listened carefully to what your customers or employees want or need. Ask again!)

  2. The system is not in writing or lacks clarity, ownership, measurement, or reporting. (Your business system is haphazard, ever changing, and passed on by word-of-mouth. Get it formalized!)

  3. The process is slow or produces too many defects, both of which drive up costs. (Your system or process suffers from poor design, inadequate training, or lack of measurement and feedback. Take steps to eliminate defects and delay!)

  4. The system is overloaded and cannot handle the demand. (In-baskets are full or things are stacked up, waiting to be worked on. Increase the capacity of the system. Eliminate the bottleneck!)

  5. The business system lacks focus. It is too broad, far reaching, or complex. It has more than one purpose or objective. (Divide the system into smaller and more manageable subsystems. Reduce and simplify!)

  6. The system is dependent upon other processes that are not performing well. (Use a "5-Why Analysis" to identify the true source of the problem; then go fix it first!)

  7. Data and feedback are used to punish people rather than to improve performance. (Most problems are your fault for not creating a good system in the first place. Provide effective training. Look first for faulty business systems, not faulty people!)

  8. The new system or process is not carefully deployed. (Workers lack preparation or training. They don’t have the desire to discontinue the old process or the patience to let the new process succeed. They may fear change or worry about having their performance measured. Deploy new systems or processes with preparation, sensitivity, and encouragement. Let people know what's in it for them!)

  9. Information about system performance is based on gut feelings or bad data, and does not reflect the true condition. (Your gut is good at sensing a problem, but not so reliable at diagnosing the problem. Get the facts—MEASURE!)

  10. Managers avoid facing the brutal facts about system failures. (Confront the truth about problems that emerge from personal frustration, customer complaints or financial data. Get real, and get going!)

Do This Now

Tomorrow, while in the Zone, think about the most frustrating part of your business. What system or process does that frustration point too—lead generation, customer service, collections, production—or perhaps a more specific subsystem? Then, consider the ten-reasons-for-failure described above to identify the source of the problem. You will quickly discover where to focus your improvement efforts.


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Tags: People, System Failure, Systems