EU Design seems to have found itself at the brink of a transition point. The lack of standardized procedures, the broad range of products the company represents, its differentiated markets, the growing number of clients, the
increasing number of staff in two very different offices, the increasing complexity of communicating effectively between the two offices internally and with suppliers and clients externally, and finally the need to increase sales all present obstacles to the company’s future development.A tool for analyzing the effects of the first growth crisis on a company such as EU Design is the system dynamics model, which is an approach to understanding the behavior of complex systems over time. The memo contains five distinct loops (blue, green, red, yellow, and the combination of all four) describing several variables (and their links) that together support or limit the company’s growth.Because you have a background in systems dynamics and are a close colleague to Berardi, he has asked you for your advice and counsel in the form of a confidential memorandum describing: (1) the underlying structure for each of the four individual and one combined loops, and, (2) whether he should continue to informally manage the company, creating staff satisfaction and allowing for multitasking? If so, what would be the effect on EU Design’s operations in the long run? If not, where is the leverage and what should he change?The memorandum should include an introductory paragraph; the body of the memo should
describe clearly and concisely the underlying structure for each of the four and one combined
causal loop diagrams; the recommendation section should be related to the final causal loop
dynamics answering the second issue; and the final conclusion should summarize the
memorandum. The five causal-loop diagrams used below shows the result of a basic application of this model to EU Design.The attached memo contains five distinct loops (blue, green, red, yellow, and the combination of all four) describing several variables (and their links) that together support or limit the company’s growth. Lastly, if the organizational structure should change, provide a description outlining the restructure, (formal, divisional, hybrid) and create a basic diagram of the structure and how customers/suppliers feed into it.Senge, P. (2006). The fifth discipline: The art and practice of the learning organization. New York: Doubleday. (Chapters 11 and 14)
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