Introduction

to
Systems Thinking

WHAT IS SYSTEMS THINKING?

Founded in 1956 by MIT professor, Jay Forrester.
System thinking allows people to make their understanding
of social system explicit and improve them in the same
way that people use engineering principles to improve their
understanding of mechanical system.
It is use to: Examining how we create our own problems
Seeing the big picture
Structure influences performance

SYSTEM THINKING APPROACH

Traditional analysis

Systems thinking

Traditional analysis focuses on

the separating the individual
pieces of what is being studied; in
fact, the word analysis actually
comes from the root meaning to
break into constituent parts.

Systems thinking, in contrast,

focuses on how the thing being
studied interacts with the other
constituents of the systema set
of elements that interact to
produce behaviorof which it is a
part.

Examples of area System Thinking has

proven its value include:
Complex problems that involve helping many
actors see the big picture and not just their
part of it
Recurring problems or those that have been
made worse by past attempts to fix them
Issues where an action affects (or is affected
by) the environment surrounding the issue,
either the natural environment or the
competitive environment
Problems whose solutions are not obvious

Systems Thinking
Helps us :
1.To explore interdependencies and
looking for patterns
2.To understand feedback structures
that change systems over time.
3.To
understand
results
of
our
decisions

Max Barret

Webecoist.com

SYSTEMS THINKING TOOLS

Causal Loop Diagrams
A useful way to represent dynamic interrelationships
Provide a visual representation with which to
communicate that understanding

Make explicit one's understanding of a system

structure - Capture the mental model

Components of Causal Loop Diagrams

Variables - an element in a situation which may act or be
acted upon
Vary up or down over time (not an event)
Nouns or noun phrases (not action words)
Links / Arrows - show the relationship and the direction
of influence between variables
S's and O's - show the way one variable moves or changes
in relation to another
S or + stands for "same direction
O or - stands for "opposite direction
or B - Balancing feedback loop that seeks
equilibrium
or R - Reinforcing feedback loop that amplifies
change

Types of Causal Loop Diagrams

Reinforcing Loop
Behavior Over Time

Structure
Employee
Performance

Perf.
Level

Supportive
Behavior

Supervisors
Supportive
Behavior

Unsupportive
Behavior
Time

Types of Causal Loop Diagrams

Balancing Loop
Structure
Desired
Inventory

Behavior Over Time

Discrepancy
O

Actual Inventory

Actual
Inventory
S

Inventory
Adjustment

100 ++

Desired Inventory

100
100 - -

Time

Demand for energy and oil price

1 - 12

Availability of gasoline and electric cars

1 - 13

Dynamics of Natural Gas Industry

1 - 14

Dynamics of Natural Gas Industry

1 - 15

Systems Thinking
Helps us understand results of our decisions

THANK YOU

1 - 17

SYSTEMS THINKING ARCHETYPES

A class of tools that capture the "common
stories in systems thinking
Powerful tools for diagnosing problems and
identifying high leverage interventions that
creates fundamental change

List of System Thinking

Archetype

1. Fixes that Fail / Backfire

2. Limits to Growth/Success
3. Shifting the Burden / Addiction
4. Tragedy of the Commons
5. Drifting Goals

1. Fixes that Fail

S

Behavior Over Time

Problem
Symptom

Fix
Delay

O
S

S
Unintended
Consequences

Time

1. Fixes that Fail

Example:
An example would be fixing problem of a squeaky
wheel. Imagine someone who knows nothing about
mechanics, mistakenly grab a can of water and
splash it on the wheel. With great relief the
squeaking stop for a while, it will
return more loudly as
the water join forces
to rust the joint.

1. Fixes that Fail

Prescriptive actions:
Increase awareness of the unintended
consequences
Cut back on the frequency with which you apply
the fix
Try to minimize the undesirable consequences
Reframe and address the root problem, give up the
fix that works only on the symtom
Breaking fixes that fail merely alleviating a
symptom, not really solving the problem. A two
pronged attack of applying fix and finding
fundamental solution will help to break the
problem.

2. Limits to Growth
Behavior Over Time

Structure

Burnout

Growing Action

Target
S

Perf.
Level

Diminishing
Returns

O
S

Corrective
Action

Actual Performance

Positive
Reinforcement

Time

2. Limits to Growth

2. Limits to Growth

Example:
At the beginning of a quality improvement campaign,
significant gains in quality and productivity were
achieved. Once this achieved, the level of
improvements plateaus.
The next wave of improvements
are more complex and tougher to
manage. Later the lack of
organization-wide support leads to
limited/diminishing quality and
productivity of the whole organization (it becomes
stagnant or diminish).

2. Limits to Growth
Prescriptive actions:
Beware of doing more of what worked in the past.
If your growth has stalled, look at both reinforcing
and balancing loops to try to find interrelationships
between your success strategies and potential
limits.
Look for other potential engines of growth.
The real leverage in limits to growth scenario lies in
its early phases.
The choice between plateauing or peaking often
depends on length of balancing loop delay and our
response to it.

3. Shifting the Burden

Quick fixes

Behavior Over Time

+
_

Problem/symptom
_

Side effects

Efforts Quick fix

Problem symptom

Capacity of system
to fix itself

_
+
Source of problem
/Root cause
_

Time

3. Shifting the Burden

Apply Patches
+

Behavior Over Time

+

Damage of Road
_

Damage of road

Proper road
construction

_
Proper Road
Contruction

Feeling of Okay

Apply patches

+
Time

3. Shifting the Burden

Example:
Problem of pot holes on the road. The problem is handled by
applying patches with immediate effect, thereby solving the
problem for a while. The primary source of the problem is
overlooked, that is the overall quality of the road construction.
The origin of the problem
should be identified and
solved in the long-term run
or else the quality of the
road will be further
diminished.

3. Shifting the Burden

Prescriptive actions:
Strengthen the long-term solution.
If possible, support only long-term solution. If
you must address the symtoms right away, do so
with restraint.
As you strengthen long-term capability, do what
you can to reduce dependency on the short-term
fix.

4. Tragedy of the Commons

S

As Activity

Net Gains
for A
S
S

Total Activity

Gain per
Individual
Activity

Resource
Limit

Time

Bs Activity
S

Net Gains
for B

Time

4. Tragedy of the Commons

Fixed
Budget

Investment
in features
S

Investment
in Integration

Success from
Product
Investment

Investment
in Integration

Success from
Product
Investment
S

Investment
in features

Time

Perceived
Success from
Integration

DELAY

Fixed
Budget

Time

4. Tragedy of the Commons

Example:
Traffic jam in Jakarta. Everyone wishes to avoid
traffic jam will use the highway. At first there is room
for everyone, but after sometimes critical threshold has
been reached, each driver brings about
decrease in average speed.
As individuals each person feels he or
she is a victim of traffic but in effect
they all conspired as a group to create
traffic jam.

4. Tragedy of the Commons

Prescriptive actions:

In any of the tragedy situations, there must be an

overriding legislation for common good.
To protect common resources some form
of regulation should be introduced.
Re-evaluate the nature of the commons to determine
if there are ways to replace, renew or substitute the
resources before it becomes depleted.

5. Drifting Goals
O

Goal

Pressure to
Lower Goal
S

Goal

Gap

Time
S

Actual

Corrective Action
S

5. Drifting Goals
S

Perceived Desired
Temperature

Tolerance for
Temperature

Temp

Temperature
Gap

Time

S
O

Hop Out

5. Drifting Goals
Example:
If you put a frog in cold water and slowly bring
the water to boil the frog will jump out when it
gets uncomfortable or even died in the boiling
water
If you put a frog in boiling water,
it will croak IMMEDIATELY.

5. Drifting Goals
Prescriptive actions:

Establish a clear transition plan from current reality

to the goal including realistic timeframe to achieve
the goal.
Determine whether the drift in performance is the
result of conflicts between the stated goal and
implicit goals in the system.
Anchor the goal to an external frame of reference
(benchmarking).

Systems Thinking
Case Study

Crop Damaging by Insects

Reducing Crop Damage by Insects:

When an insect is eating a crop, the conventional
response is to spray the crop with a pesticide
designed to kill that insect.
Putting aside the limited effectiveness of some
pesticides and the water and soil pollution they can
cause, imagine a perfect pesticide that kills all of the
insects against which it is used and which has no
side effects on air, water, or soil.
Is using this pesticide likely to make the farmer or
company whose crops are being eaten better off?

Reducing Crop Damage by Insects:

If we represent the thinking used by those
applying the pesticides, it would look like this:
Pesticide
Application

Insects
Damaging Crops

1.

The letter indicates how the two variables are related: an s means they
change in the same direction - if one goes up then the other goes up, and
an o means they change in the opposite direction - if one goes up then
the other goes down (or vice versa).

2.

This diagram is read a change in the amount of pesticide applied causes

the number of insects damaging crops to change in the opposite
direction.

3.

The belief being represented here is that as the amount of pesticide

applied increases, the number of insects damaging crops decreases.

Reducing Crop Damage by Insects:

Number of Insect A
Damaging Crop
O

Number of Insect B

Pesticide
Application
S

Number of Insect B
Damaging Crop

Total number of
Insects damaging crop
S

Reducing Crop Damage by Insects:

4.
5.
6.
7.
8.

The problem of crop damage due to insects often does get better - in the
short term.
Unfortunately, what frequently happens is that in following years the
problem of crop damage gets worse and worse and the pesticide that
formerly seemed so effective does not seem to help anymore.
This is because the insect A that was eating the crops was controlling the
population of another insect B, either by preying on it or by competing with
it.
When the pesticide kills the insects A that were eating the crops, it
eliminates the control that those insects were applying on the population of
the other insects, insects B).
Then the population of the insects B that were being controlled explodes
and continue to damage the crops.

Reducing Crop Damage by Insects:

So now how do you solve the problem
of Insect B damaging the crop?

Find the solution..

Reducing Crop Damage by Insects

The solution:
With this picture of the system in mind, other
actions with better long-term results have been
developed, such as Integrated Pest Management,
Management
which includes controlling the insect eating the
crops by introducing more of its predators into the
area.
area These methods have been proven effective in
studies conducted by MIT, the National Academy
of Sciences, and others, and they also avoid
running the risk of soil and water pollution.

References
Warfield, J. Societal Systems, Intersystems, 1989.
Joseph OConnor & Ian McDermott. The Art of Systems Thinking,
Thorsons, 1997.
Senge, P.M.
The Fifth Discipline: The Art & Practice of the Learning Organization,
Doubleday, 1990.
The Fifth Discipline Fieldbook: Strategies and Tools for Building A
Learning Organization, Doubleday, 1994.

System Dynamics / Systems Thinking Mega Link List

http://www.uni-klu.ac.at/users/gossimit/links/bookmksd.htm
The Way of Systems (System Archetypes)
http://www.outsights.com/systems/theWay/theWay.htm
Daniel Aronson, Overview of Systems Thinking, 1996-8
http://www.thinking.net