The better you understand the system that you are in, the more options you have for solving problems and seeking success. Leading with blinders (and it’s hard to know you wear them) keeps you focused on a straight and narrow track but may block important and critical aspects of the system. This blindness can create life-threatening problems for your institution. Thinking globally while acting locally gives you the best strategic view to guide tactical decisions.

It’s easy to plot the accelerating rate of business failure and predict that in the next decade extraordinary numbers of businesses will simply disappear as the world changes right out from under them. Historically, trends in the business community creep into the museum community about a decade later. With the accelerated rate of change we are experiencing worldwide, this time lag is shortening to only a few years. We’re beginning to see major museums fall into a nonprofit equivalent of bankruptcy. I believe this trend will accelerate. For those of us not now close to the edge of disaster, I predict life will become much more challenging in the next decade. The solution? Better understand the system that impacts the museum so you are not blind sided and so you have enough time to steer a safe course.

The behavior and performance of every museum results from the interaction of a large number of variables. We call this the museum system. Qm2 has found it useful to separate this single system into five distinct subsystems. We call these:

1. The External (environmental) System
2. The Transformational (value-adding) System
3. The Support (administrative) System
4. The Organizational (social) System
5. The Learning (getting better at getting better) System.

1. The External System
Every museum sits in an external system—the environment outside the museumthat includes its market, community, competition, technology, the economy and so forth. The museum typically considers these elements when formulating mission and strategies. Consequently, changes in the external systems can necessitate changes in mission and strategies. Failing to notice external changes or resisting them causes aging, bureaucratization and the death of a museum. A strong vision and purpose prevents the museum from being driven by forces in the external system. The remaining four systems all lie within the museum.

2. The Transformational System
This system is the very heart of the museum’s work. Here the mission and vision are fulfilled by creating value for the external world. The article on loyalty in this issue explores specific ways of measuring this value.

The transformational system begins with the organizations’ enduring purpose, principles and major goals. It includes the original resources or raw materialsarchives, objects, specimens, and documentation. This system transforms those resources and raw material, objects and knowledge, into higher value outputs in the form of exhibitions, publications, and programs. Marketing makes the audience connection. Taken together, the transformational processes—from accessioning new collections to selling tickets to visitors—create maximum value. These interlinked processes produce the result for which the institution was designated.

Too often the system is not seen as a whole by those within it. Most people see only their subsystem—their department, project, or board committee—the system element where they were trained or where they work. Only the director has a view of the total system and, even so, strong allegiances to one element or another may skew the director’s view. When you can’t see the whole system, you can’t take it into account when acting locally. Failure to think globally when deciding locally can produce unintended negative consequences elsewhere in the museum.

3. The Support System
The third important system in your museum supports the process of transformation. Support system elements emerge as the museum matures and grows in size and complexity. But as a museum ages, its support system may become rigid, perpetuating itself at the expense of the organizational vision. When development is driven by opportunism instead of mission, when planning is driven by budgets instead of vision, when personnel laws constrain who is hired, the support system is impeding rather than facilitating transformation.

4. The Organizational System
The organizational system focuses on the social, the people side, of the museum. It orchestrates the integration of the people with the sransformational and support systems. This is the realm of organizational design and development. It encompasses the organization’s hierarchy, job descriptions, communications, teamwork, and culture.

As information and practice move from business into museum work, museum leaders must avoid focusing on the social organization to the exclusion of the transformation system. Too much focus on the organizational system creates a "nicer" place to work but may dull the museum’s ability to produce value. The transformational and organizational systems must work in tandem. They can both be strengthened but, like the support system, the organizational system must serve the transformational system, which directly creates and delivers the value of the institution. The transformational system always leads and the other systems follow about a nanosecond behind.

5. The Learning System
The real challenge is the fifth system. The learning system improves your ability to improve as you focus on getting better at getting better. Can you name several activities in your museum that fall into this category?

Many museums can’t. At best, a once-a-year retreat might focus on improving some element of the other three internal systems. Little attention is given to learning how to improve your ability to make improvements.

Other institutions engage in a variety of activities intended to improve themselves. Some focus on transformational systems; this is usually where professional development activities and professional associations focus. In the 1970s and 1980s the support system elements received more attention. More recently the organizational system has received focus and improvement efforts. But, most of the system-specific improvement efforts are projects with a beginning and an end, limited to local thinking without a global view.

Your organization can get better at getting better by adopting:

• better ways of understanding your market and comprehending your competition;

• better way of boosting collective I.Q. by creating techniques for staff and volunteers to share information and by storing and indexing lessons learned;.

• better ways of connecting tasks by encouraging cross-functional communities explicitly charged with working on common challenges;

• better ways of fostering learning by creating a team with a member from each internal system and an exclusive agenda for getting better at getting better.

Museums have plenty of stabilizers: boards, executive committees, auditors, senior management teams. What they need are not governors but accelerating devices. Intermittent meetings and decisions which must be passed from layer to level to lawyer and back are too slow. Tools and technology won’t help if people can’t learn and learn more quickly. The focus of the learning system is improving improvement by accelerating not individual learning but institution-wide learning.

Most of the problems museums face result from failing to recognize one or more of the five systems and their interaction. When individuals in the museum have more allegiance to their subsystem than to the whole system, the whole system is jeopardized by a departmental sclerosis or hardening of the walls between the systems.

We call understanding the whole system institutional literacy. When everyone in the organization sees the whole museum system, with all its subsystems, they gain the strategic view—even vision—that can guide the museum successfully into the future.