Systems Analysis: Systems Analysis Bhavya Lal Origin Approach People Applications Evolution Evaluation


Origins: Origins developed in the 1950s at the RAND Corporation as part of a suite of techniques for supporting wartime assessments, in creating a “science of war” to evaluate alternative nuclear weapons scenarios next generation bomber aircraft design of an air defense system subsequently developed as a resource allocation methodology publication of the 1960: “Economics of Defense in the Nuclear Age” by Charles Hitch and Roland McKean, economists at RAND


Approach: Approach a rigorous, "rational" means of comparing the expected costs, benefits, and risks of alternative future systems--such as weapons systems--characterized by complex environments, large degrees of freedom, and considerable uncertainty. the word 'systems' indicates that every decision should be considered in as broad a context as necessary . . . the word 'analysis' emphasizes the need to reduce a complex problem to its component parts for better understanding.


Methods: Methods field quantitative (mathematical modeling) and qualitative, but goal is managerial decision-making Operations Research Game Theory Probability and Statistics Econometrics Linear/dynamic Programming (and later in social policy analysis) Regression Analysis Survey Research Experimental Design


Related Concepts: Related Concepts systems engineering (manage large projects), ICBM design and development operations research (analyze military operations) military bombing raids systems analysis (comparison of systems that offer alternative solutions to problems) use of long-range bombers vs. ICBMs system dynamics (models for predicting and comparing downstream consequences of outcomes of alternative policies) SD a part of SA?


Proponents: Proponents Early years – Military Applications Charles Hitch RAND and then Asst. Sec. for Defense Alain Enthoven RAND, and then Dep.Asst. Sec. for Defense K. Wayne Smith RAND Robert McNamara Sec of Defense, Kennedy/Johnson, Economist, Harvard MBA, Army Statistician, Ford Motor Company


Early Applications: Early Applications Use by McNamara for streamlining the Department of Defense established Office of Systems Analysis at the Pentagon brought in the RAND “whiz kids” approach met stiff opposition but eventually pressured the military to learn the methods and train their own staff


Applications Phase 1: McNamara Revolution: Applications Phase 1: McNamara Revolution McNamara relied heavily on SA to reach several controversial weapons decisions canceled the B-70 bomber and vetoed its proposed successor RS-70 increased focus on faster, less vulnerable and less costly ICBMs (rather than manned bombers) terminated the Skybolt project (ballistic missile with 1000 nmile range designed for launching from B-52 bombers as a defense suppression weapon) initiated and continued the TFX (later F-111 aircraft); based on SA awarded contract to General Dynamics – failed project instituted a much-publicized cost reduction program which (he reported) saved $14 billion from 1961-1966


Applications (cont.): Planning, Programming, and Budgeting: Applications (cont.): Planning, Programming, and Budgeting McNamara instituted PPBS for planning and reviewing requirements, formulating and reviewing multiyear programs, and developing the annual budget estimates helping the Air Force manage the enormous costs of modern military technologies and weapons systems In 1961 the PPBS methodology became one of the cornerstones of the "McNamara Revolution" in the Department of Defense


Evolution of Systems Analysis: Evolution of Systems Analysis Early 60s saw migration of primary national concerns away from global nuclear warfare toward counterinsurgency, limited warfare and social revolution Connections between national security and social welfare began the next wave of applications; in 1965 President Johnson mandated PPBS use across the federal bureaucratic structure. Charles Schultze (1965, Director of the Bureau of Budget) transferred PPBS from the Pentagon to social welfare agencies (Departments of Health, Education and Welfare, Office of Economic Opportunity etc)


Proponents II: Proponents II Later years – Social Reform Analysis Sargent Shriver Task force on anti-poverty programs Charles Schultze Bureau of Budget Henry Rowan RAND Roger Levian RAND and IIASA


Applications Phase 2- Policy Analysis: Applications Phase 2- Policy Analysis Establishment of new institutions for social policy analysis: the Urban Institute, IIASA, etc Applications health care: design and experimental testing of school voucher systems education: design and experimental testing of health insurance systems housing: analysis of rent control and the design of a housing allowance system design of public systems for transportation, water supply and communications international: global climate modeling


Evaluation: Evaluation fundamentally altered the nature of decision-making in the Department of Defense (“civilianization” at DoD). gave rise to a vast market for policy-oriented social science research; replaced political bargaining with technocratic expertise as the primary means of policy formulation; but in the end, proved too fine-honed, too focused on technical and economic factors, to respond to the messy, politicized urban problems