Flexibility “of” Versus “in” Systems: A Complementary Strategy for Designing Fleet-Based Systems for Uncertainty

Abstract

Complex systems must sustain value over extended lifetimes, often in the face of significant uncertainty. Flexibility “in” systems have been shown to be highly valuable for large monolithic systems (LMS). However, other research highlighted that the value of flexibility “in” is highly contingent on delays in implementation. These limitations become more important when applied to other classes of complex systems, including fleet-based systems (FBS). To overcome these challenges, this paper introduces a complementary approach to flexible design, termed flexibility “of,” and applies it to a case study of a fleet of military vehicles (an FBS). Unlike LMS, FBS are composed of multiple identical units that collectively deliver value. While each unit is itself a complex system (e.g., a tank or aircraft), the collective nature of the operations provides additional paths to flexibility: in addition to implementing flexibility at the vehicle level, flexibility can be applied to the management of the fleet. Flexibility “of” involves procuring a mixed capability fleet upfront and then actively managing which subsets of that fleet are deployed to meet emerging needs. Our results demonstrate the potential value for an of strategy and provide guidance for when different flexibility strategies should be adopted alone or in combination.