Systems Thinking

Lessons From The Fifth Discipline Fieldbook by Senge, Kleiker,

Roberts, Ross and Smith

Presentation by
Joanna Beltowska @jbeltowska
Amy Rae @elucidateamy
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Oh hai again!

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All of these things are systems.

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Are you looking at a system or a bunch of stuff?

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Can you identify the individual parts?

Do the parts affect each other?

Do the parts together produce an effect that is

different from the effect of each part on its own?

Does the effect persist in a variety of

circumstances?

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Ping pong is a system.

IT HAS IDENTIFIABLE INDIVIDUAL PARTS.

PART 2

PART 1

PART 3

PART 4

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Ping pong is a system.

THE PARTS AFFECT EACH OTHER.

LAWS OF PHYSICS

RULES OF THE GAME

LAWS OF PHYSICS

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Ping pong is a system.

TOGETHER, THESE PARTS CREATE A UNIQUE EFFECT.

LAWS OF PHYSICS

RULES OF THE GAME

LAWS OF PHYSICS

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Ping pong is a system.

THIS EFFECT CAN BE REPLICATED IN MULTIPLE SITUATIONS.

LAWS OF PHYSICS

RULES OF THE GAME

LAWS OF PHYSICS

X
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1, X 2, X 3...

Finding and analyzing systems is difficult work.

The following pages will introduce systems thinking,
a set of tools and methods to help you along the way.

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WARNING:
Systems always surprise us.

Dont fret!
This way for the three main reasons why.

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We are li

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s
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e
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n
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th

in a

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ear
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wo
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In a nonlinear relationship, the cause does not produce a

proportional effect.
is range represents the optimal amount of fertilizer to apply, and if too much is applied,
the yield might even go down.
Crops Yield

Fertilizer Application
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Reality is made up of circles, but we see straight

lines. Herein lies the beginnings of our limitation as
systems thinkers.

Peter Senge

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The Linearity Double Dunk

Formal education rewards
linear thinking.
Research with young children
indicates that we have
latent skills as systems
thinkers that are
undeveloped, even
repressed, by formal
education.

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Language shapes perception.

Western languages are biased
towards a linear world view
because of their
subject-to-verb
object structure. This
structure trains our
brains to link together
thoughts in the same way.

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In the real world, boundaries dont exist. There are only

boundaries of thought, perception and social agreement.

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BOUNDED RATIONALITY

In decision making, rationality of individuals is limited by

the information they have.

Fishermen are not aware of the total number of fish in the

ocean or how many fish othersharvest. This is a typical
example of a dilemma referred to as The Tragedy of the
Commons - a situation in which a group of individuals act
rationally in their own self-interest and deplete a shared
limited resource.

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E xp li ci t kn ow le dg e

MENTAL MODELS

Individuals are also inhibited by their mental models - the

images, assumptions, and stories which we carry in our
minds of ourselves, other people, institutions, and every
aspect of the world.
Taci t know ledge

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Systems fool us by presenting
themselves as a single event.

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The stock market crashed in 1929, making

headlines. This single event was overemphasized,
and other, more important, events influencing the
Great Depression were less salient, like the
200,000 factory workers being replaced by
machines and farmland value falling by 40%.

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Events accumulate into dynamic patterns of behavior.

e Great Depression begins
Wheat prices per bushel in dollars
3

2.5

1.5

0.5

1900

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1910

1920

1930

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Long-term behavior provides clues to the underlying

system structure.
System structures are created by the choices people make
consciously or unconsciously over time.
In systems thinking, structure is the pattern of
interrelationships among the key components of the system.
That might include hierarchy and process, but it also
includes attitudes and perceptions, the quality of products,
the ways in which decisions are made, etc.

e winter of 1929 was a so called long wave winter.

Long wave theory, a subset of systems thinking, says
that economic crisis come and go in cycles.
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Researchers at MIT came up with ways to understand and

categorize different types of systems.
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With practice, these tools can help you unpack complex

problems in a flash.

Think of these tools as your diagnostic

repertoire.

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Links and Loops

T H E F O UND A T I O N O F SYST E M S M O D E L I NG

Links are arrows that represent influence between elements

in a system.
Loops are combinations of links that that reveal
interdependencies; In a loop, every element is both the
cause and the effect.
Example: The more lolcat pictures on
icanhazcheeseburger.com, the more time people spend
there, commenting on lolcat pictures, and becoming inspired
to create more. (Because we all know lolcats are awesomely
hilarious!)

A LINK:
NUMBER OF
LOLCATS

TIME SPENT
ON THE SITE

Cause

Eect

A LOOP:

NO. OF
LOLCATS

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TIME SPENT
ON THE SITE

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Balancing and Reinforcing Loops

T W O T YPE S O F L O O PS T H A T O CCUR F RE Q UE NT L Y

Balancing loops occur in systems that are self-regulating.

The system has an inherent goal, and when that goal isnt
met, intense pressure is applied to reach it.

US ARMS

(R)

NEED TO BUILD
US ARMS

Example: Your refrigerators goal is to keep food at a chilly

35 degrees. When a half-eaten pizza enters, the refrigerator
decreases the temperature to cool the warm pizza, bringing
the refrigerator back to equilibrium.

THREAT TO
SOVIET UNION

THREAT
TO US

NEED TO BUILD
SOVIET ARMS

Reinforcing loops occur in systems that steadily grow

and/or collapse over time.
Example: The Nuclear Arms Race between the US and the
Soviet Union during the cold war is a typical example of a
reinforcing loop. The US created the first atomic bomb in
1945. The Soviet Union followed in 1949. By the 1950s both
sides had enough nuclear power to obliterate each other.
The system then declined when both stockpiles decreased in
the 1990s.

SOVIET
ARMS

NUCLEAR STOCKPILES 1945 - 2005

45,000

Exponential growth

SOVIET
USA

40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000

Sources: Natural Resources Defense Council (1946-2002 data),

Bulletin of the Atomic Scientists (2003-2006 data)
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0
1945

1955

1965

1975

1985

1995

2005

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Balancing and Reinforcing Loops: Templates

A D A PT E D F RO M T H E F I F T H D I SCI PL I NE B Y PE T E R M . S E NGE . US E T H E S E T E M PL A T E S A S A S T A RT I NG PL A CE F O R S YS T E M A NA L YS I S .

REINFORCING LOOP TEMPLATE

BALANCING LOOP TEMPLATE

Optional intermediate element (might

be a consequence of performance)

Actual performance
(that you measure or
observe; often a problem
symptom)

Actual performance
(that you measure or
observe, which you can see
growing or declining)

(R)

Optional intermediate element

(might be a driver of performance and/or a
consequence of action)

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Growing action
(what you do, or someone
else does, to generate growth
or decline)

Target or goal
(desired performance, either
known or unknown to you)

(B)
Optional
intermediate
element (might be a
driver of performance)
Corrective action (can be a
quick x or a driver of your
performance)

Gap (discrepancy between

desired and actual
performance, either visible to
you as a shortfall, evident as
a need, or felt as a pressure)

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Causal Loop Diagrams

H E L PI NG YO U T E L L A M O RE RO B UST ST O RY

Causal loop diagrams combine multiple loops and reveal

more detail about the system. A plus indicates that the
elements change in the same direction while a minus
indicates that the elements change in opposite directions.
Example: The bank panic during the Great Depression was
caused by a public fear of bank failure. This caused people to
withdraw their personal savings, reducing bank solvency,
which in turn drove private withdrawals of funds further in a
spiraling, reinforcing, loop.

+
-

WEAK OR
UNCERTAIN
ECONOMIC
CONDITIONS

PERCEIVED
SOLVENCY OF BANK

SOLVENCY
OF BANK

(+)

FEAR OF
BANK FAILURE

(+)

+
+

BANK RESERVES
ON HAND

TENDENCY TO
WITHDRAW
PERSONAL SAVINGS

Casual loop diagram describing the bank panic during the

Great Depression (adapted from Beyond Training Wheels
by John Sterman).

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System Archetypes
A PE RI O D I C T A B L E O F T H E M O ST CO M M O N SYST E M B E H A VI O RS

If we think of each system as a story, system archetypes

are the classic stories that we keep seeing over and over
again. By measuring our systems against these classics, we
can quickly identify the dominating behavioral patterns.

Problem
symptom

CURRENT
PROFITS

For example, Fixes That Backfire: A company is struggling

with profitability (the problem symptom) and decides to let
some people go to reduce costs (the fix). Profitability initially
improves, but the loss of experienced employees as well as a
drop in morale impact productivity negatively (the
unintended consequence).

STAFFING
CUTS

Fix

PRODUCTIVITY

Unintended consequences

PROBLEM SYMPTOM

Fix applied

Original threshold of tolerance

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Archetypes: Comparison Chart

A D A PT E D F RO M T H E F I F T H D I SCI PL I NE B Y PE T E R M . S E NGE

BALANCING LOOP

REINFORCING LOOP

FIXES THAT BACKFIRE

There is a movement toward a target (without

delay), or else oscillation, hovering around a single
target (with delay).

An important variable accelerates up (or down),

with exponential growth or collapse.

A problem symptom alternately improves (the

problem variable goes down) and deteriorates
(the problem goes up, worse than before).

LIMITS TO GROWTH

SHIFTING THE BURDEN

TRAGEDY OF THE COMMONS

There is a growth (sometimes dramatic growth),

leveling off or falling into decline.

The reliance of the short-term fix grows stronger,

while efforts to fundamentally correct the real
problem grow weaker. The problem symptom
alternately improves and deteriorates.

Total activity grows, but the gains from individual

activities are dropping.

ACCIDENTAL ADVERSARIES
Each sides performance either declines or stays
level and low, while enmity or competitiveness
increases over time.
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Stocks And Flows

A D A PT E D F RO M T H I NK I NG I N SYST E M S B Y D O NE L L A M E A D O W S

Stock and flow diagrams are another way to analyze

systems. Stocks are tangible and measurable, and they
change over time through the actions of flows. Stocks act as
buffers, delays or shock absorbers in systems.
Example: Imagine youve decided to take a bath. You begin
to fill your bathtub with hot water and go read while youre
waiting for the tub to fill. When you come back, the water is
a bit too hot for your liking. To get the temperature down
quickly, you open up the drain and turn the cold water faucet
on. Your bathtub is now a simple system with one stock (the
water in the tub), one inflow (the cold water) and one
outflow (the water that is leaving through the drain).

Inow

Stock

WATER IN
BATH TUB

COLD WATER

Inow
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DRAINED WATER

Stock

Outow
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Systems Analysis Guidelines

T H E SYST E M S T O O L K I T I N A CT I O N

All models are simplifications of the real world. Its up to

you to decide how much detail to illustrate.
There are no right answers. Mapping out a system will
reveal a set of potential actions you may take. As you
become more a more proficient systems thinker, youll begin
to recognize the consequences of different interventions.
Cause and effect will not be closely related in time and
space. Don't look for leverage near the symptoms of your
problem.
Good results in a complex system depend on bringing in as
many perspectives as possible. Consider who else you can
bring in to make your system model more informed.
Use your intuition when you work with archetypes. It's not
critical that you pick the right archetype - as long as it rings
true with your story, it's good enough as a starting point.

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LEVERAGE FOR LASTING CHANGE

A good systems thinker avoids traps by looking for multiple

levels operating simultaneously.

MENTAL MODELS

SYSTEMS

PATTERNS OF BEHAVIOR

EVENTS

ADAPTED FROM THE FIFTH DISCIPLINE FIELDBOOK BY PETER M. SENGE

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Good Systems Thinkers Make Good Strategists

A ST O RY O F H O W ST RA T E GY D E F E A T E D 1: 2 5 O D D S

On October 26, 1597, the Korean admiral Yi Sun-sin

famously defeated the Japanese fleet of 333 units with only
13 ships at his disposal.

Admiral Yi: a badass

systems thinker.

Yi strategically chose the Myeongnyang Strait as the arena

for his last stand with the Japanese based on its strong
currents, narrowness, rough tides and surrounding shadowy
hillsides. By reading the environment as a system, admiral Yi
used it to his advantage.
No other naval battle involving fleets of this size, has
resulted in a victory for such a proportionately small force,
also making it one of the greatest military achievements in
world history.

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Cancer (?)

The challenges society faces are growing.

Measles (1963)

Smallpox (1796)
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In order to meet those challenges, we need to explore new

ways of thinking. Systems thinking is the cornerstone of
how adaptive organizations think about their world.

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Designing a Systems Workshop

PUT T I NG SYST EMS T H I NK I NG I NT O PRA CT I CE

Tackling a huge problem? Systems analysis will help

elucidate multiple sides of the issue and identify areas of
opportunity. Workshops or brainstorms are great forums
for this type of analysis. Below is a (very) general overview
of a good workshop:
Study up: Learn your links, loops and archetypes. For
practice, sketch out systems diagrams of popular problems,
like Global Warming or Poverty.
Event Prep: Invite stakeholders from all levels of the
organization; Unique perspectives will make the analysis
more robust. Choose a room with a white board and bring
your markers!
Facilitation: In general, spend 1/4 of the time introducing
the concept and creating a safe space for open discussion.
Spend 1/2 of the time analyzing the problem on the white
board with the Systems Toolkit, and spend the remaining 1/4
looking for possible interventions in your diagram.
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Darth suggests you use the Five Whys

to help the group discover deeper
interactions between elements.

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Its like the old expression, You are what you eat.
If you start thinking differently, you see things differently.
And all your actions start to change.
- Pat Walls, FedEx

Are you ready to switch to a loops-based diet?

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Special thanks to our mentors and friends at

Systems Thinking
Lessons From The Fifth Discipline Fieldbook by Senge, Kleiker,
Roberts, Ross and Smith

Presentation by
Joanna Beltowska @jbeltowska
Amy Rae @elucidateamy
2 011 JOAN N A B ELTO WSK A AN D AMY RAE.