Systems thinking is the only known tool to understand organisation

Systems thinking is thinking about a 'whole' , and not about individual elements. Systems thinking has a long pedigree. Unfortunately, it has remained in the academic world. We will use this blog to discover the different facets of systems thinking useful for corporate executives.

Systems thinking is non-linear thinking. It is using the variables of feedback, time, delay together to understand what is happening or has happened. And then finding a best leverage to either remedy the situation or move into an intended direction.

Linear thinking is about x causes y. Cause and effect are directly related both in time and space. For instance, better sales performance causes better sales. Using this thinking, whenever 'sales' goes down, we try to improve 'sales performance' by training sales officers, motivating them through rewards and so on. This produces the result for a time being. But sooner than later, the variables stop impacting.

The feedback loop kicks up. For instance, rewards may stop 'motivating' the sales officers. Or the 'marketing' strategy may have become a bottleneck. Or the competitor may have changed the 'game'. This feedback loop may kick after a gap of time. Understanding the effects of such feedback loops along with time and spatial gaps unravels the underlying 'structure' in the 'system'. It therefore enables an executive to devise better strategies and take effective actions.

Systems thinking is therefore useful for creating outputs in work, in relationships, in taking better decisions because it helps us understand the 'as-is' world without distorting it. We shall use this space here to understand how to use systemic thinking for understanding and therefore managing large companies. We will use this space to understand how to use non-linear thinking to generate huge outputs with less effort, time and cost.