The applicability of the Viable Systems Model as a diagnostic for small to medium sized enterprises

Abstract

Purpose This paper presents research into the use of the Viable Systems Model (VSM) in small to medium sized enterprises (SMEs). Research on the VSM has been focussed on large organisations. The purpose of this paper is to explore the usefulness of the VSM in diagnosing issues of viability in SMEs. Design/methodology/approach Case study research was undertaken in which semi structured diagnostic interviews took place with SMEs using the VSM as a diagnostic tool. The aim was to investigate whether the VSM would assist in diagnosing problems with viability and whether it could then prescribe and facilitate improvements in operations. Qualitative case study evidence is presented that shows the results of these interventions. Findings The paper reports some examples of operational problems that were exposed through the intervention process and shows some general conclusions to support the use of VSM for analysing operations and supporting small business viability. A number of “threats to viability” themes were apparent and these are discussed. Practical implications The semi‐structured interview protocol created for the research could be used to diagnose viability issues in other SMEs and thus is of practical relevance to other organisations. Originality/value The VSM originates from the theory of cybernetics which can be broadly defined as “the science of effective organisation”. Previous use of the model has focused upon the viability of large organisations; the applicability of the VSM in a small business operational context has received little attention. The paper demonstrates the benefits of the using the VSM to pinpoint problems that threaten SME viability.