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VSM Preliminary Diagnosis Step 3

Step 3:
System One: the Operation

PURPOSE: To specify those parts of the system-in-focus which undertake System One (primary) activities.

3.1 List the primary activities

Take the list from 1.3 and write down the jobs which are primary activities of the System-in-Focus. These are the Operational elements. Sketch small VSMs within the large Operational ellipse – one for each unit.

3.2 Describe the local environments

Draw in smaller overlapping environmental shapes – one for each Operational element – within the large environment.

3.3 Annotate the diagram.

Annotate the diagram, e.g., for Operational unit 1 write on “warehouse”, and in its small environment write “suppliers, machinery maintenance, racking engineers”. Think about those parts of the external environment which are specific to the warehouse.


The first system in the Viable Systems Model is the entire Operation which will be composed of several Operational units.

The Operational units undertake the System-in-Focus’s basic activities.

They will all be (smaller) Viable Systems in themselves, and thus must be able to maintain a separate existence.

System One generates wealth and in a business, each element can be considered as a profit centre.

If you are a manufacturing business, System One is the production units, the teams of people and machines which actually do the manufacturing.

If you are a programming co-op, System One is the programmers or teams of programmers, perhaps divided into various specialist areas.

If you are looking at a more complex organization, you may have a System One which includes manufacturing, distribution, and warehousing.

System One sounds straightforward but is actually one of the most difficult areas to define clearly. For example, in the examples given above the computer department was a System One in the programming firm, but the computer department in the manufacturing company would have a support role and would therefore not be part of System One. Some people who are in basically service areas such as engineering maintenance may consider themselves important enough to be System One.

The question is: are they part of what the organization is really about, or are they back-up, facilitators, or support? If the answer is the latter, then they do not qualify as System One.

You are now in a position to go back to the original list of jobs carried out by your System-in-Focus, and to list those which between them make up System One.

Note: Each Operational unit is a VSM at the next recursion down and thus will include both the physical aspects and the management of one aspect of the Operation. So, for example, the trucks and drivers and the management of the transport department are found within that Operational Unit.)

Derived from Jon Walker’s VSM Guide for co-ops and federations