Introduction to Systems Thinking

The other day I casually mentioned the concept of “Systems Thinking” and got a response that took me by surprise – that it’s a term verging on management newspeak in its empty gesturing toward completely esoteric and probably ephemeral benefits. “Systems Thinking” is a management placebo, a buzz-word tossed about with casual abandon to give a veneer of innovation. That response is almost certainly based on well-observed facts in a properly-understood workplace context. “Systems Thinking” sounds impressive, without necessarily conveying much meaning. This post, and perhaps one or two follow-up posts, are intended to outline what I mean by “Systems Thinking”. Perhaps, as with “Magic Realism” I should adopt another term, one without such baggage, but after this you should at least be able to have a conversation with me in clearly understood terms.

The word “System” means “a regularly interacting or interdependent group of items forming a unified whole”. The key concept is the “group” of items. We are accustomed to the opposite idea, of isolating the key variable, and basing all our decisions around that one criterion. Cartesian science has trained us to believe in Occam’s razor to the point of absurdity, itself reduced to the mantra that the simplest explanation is usually the correct one. Examples are ludicrously easy to find. Climate change is discussed almost exclusively in terms of temperature change, where actually that is one of many different potential effects and measures. Monetary stability is measured by inflation – so that we see crippling austerity inflicted on Europe because of German fears relating to inflation. Health is often indexed to weight. The most relevant example for me recently is the so-called New Building Standard. I could go on.

In short, “Systems Thinking” is about acknowledging complexity early, and trying to incorporate it in a fundamental way. It is about moving beyond one-variable models, to recognise the interaction of different elemental parts.

This acknowledgement can often lead to a simplification of a model derived from a fixed or singular criterion. We could, for example, regard how much simpler Galileo’s helio-centric model of the solar system is than the Ptolemaic spheres it replaced. Ptolemy required the earth to be the centre of the universe, and with that over-riding criterion, developed a fiendishly complex system to explain Mars’ retrograde motion (and other things.) What makes this “Systems” compared to “Single Criterion” is that Galileo looked at the different elements in the solar system in relation to each other, not just in relation to Earth. Of course, the outcome here is that we have a different single-variable system: the distance to the Sun. But we got there by thinking about a system.

My introduction to the idea of systems, as such, came from the high-school accounting syllabus, and one way or another, Mr Frude’s crystal-clear explanation of system concepts in those two years of high school might be the most important things I learned in my secondary education. Double-entry book-keeping is a system for record-keeping designed to prevent mistakes or cheating, because it requires an erroneous entry to be made twice, in slightly different places and slightly different ways. In order for a mistake to make its way into the system, it needs to be made twice. I am sure that most people simply find this concept tedious, when it is actually a generally-applicable approach to system design. The core accrual accounting system that I was taught is robust and pragmatic.

The concepts I learned had a far greater scope for application than I at first appreciated. For example, they were useful for interpreting the Enron scandal. The New Yorker had an amazingly cogent summary shortly after the facts began to come out, and I won’t repeat the details here. In essence, when parsed through the core accrual accounting system, the structural and systematic problems with Enron’s financial arrangements were clear. It seems at least plausible that anyone thinking about a system, rather than a mess of financial details, could have foreseen the problems.

I had one particularly illuminating discussion about the GCSB bill with some public servants. From inside the bureaucracy, they argued that there was no material difference between a Judge issuing a warrant and the Prime Minister issuing a warrant. That’s probably a correct argument in terms of the human beings ultimately making the decision, because a judge may be as corrupt or incompetent as a Prime Minister (though perhaps not this PM) – the problem is a systematic one. The problem is that the PM in the current situation is reporting only to himself – for there to be a mistake made, only one person needs to make it. With Judicial oversight, two people need to make the same mistake. For me, this is a straightforward analogue of the basic accounting system I was taught; understanding the design principles of the system continues to have daily benefits, which I can’t quite claim for anything else I learned at High School, as intermittently useful as some things have been.

There are numerous facets of “Systems Thinking”, and innumerable applications. The key point is this – be wary of the reductive or the simplistic. The world is a complex place, but not unapproachably so.

Over the next little while, I will be posting a short description of several key texts in my conception of approaching the world through the prism of “Systems”.

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One Response to Introduction to Systems Thinking

  1. Pingback: Intro to System Thinking: Freakonomics | My One Contribution To The Internet

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