Systems thinking is fundamental to understanding complex environments and proposing solutions to the challenges of our time. Changes in thinking and practice are fundamental, and understanding them is the first step towards systemic practice.
Everything is interconnected in one way or another, as our society has organized itself in a systematic way. This observation has caused systems thinking in organizations to gain prominence in the business world.
A system is a set of components that interact in an organized way – one part influences the other in a reciprocal way. These systems also relate to one another. For example, departments in a business work in an interrelated way, and need to be aligned if the organization is to achieve its long-term goals and objectives.
What is systems thinking?
Systems thinking is the ability to understand facts not only in their own right, but as they relate to other relevant people and instances. By practicing systems thinking, we are able to grasp the implications of an event for those directly or indirectly involved.
Systems thinking considers several aspects in order to carry out certain actions assertively and effectively, working together towards a single purpose and prioritizing what is good for the company as a whole. Such a “systemic view” is important for considering and enacting improvements.
Professionals who can see the relationships between different departments make decisions based on what is best for the company as a whole, anticipating the possible consequences of each choice for the different sectors and deciding which path will best direct the organization towards its goals.
In other words, systems thinking engenders a global perspective, which doesn’t distinguish sectors or treat processes individually.
The discipline seeks to understand structural elements via complex models. Interpreting reality systemically means seeing circles of influence instead of straight lines. Tracing the flows of influence reveals patterns which repeat themselves over and over again, for better or for worse – you can make a flowchart to have a better understanding about the flows of influence.
Systems thinking in organizations is the opposite of linear thinking – a line of reasoning which considers companies as assembly lines: taking one step after the other, with sectors working more or less independently, resulting in the final product.
Differences between systems thinking and linear thinking
Systems thinking allows teams to look at problems as a whole, understanding the impacts which each action may cause. Alterations within a certain company sector often affect other sectors, and once this is understood by all collaborators, problems can be properly resolved as soon as they arise.
Linear thinking, on the other hand, focuses on just one task at a time, and solving a specific problem, often disregarding the latter’s impact elsewhere.
Why is systems thinking important?
It is still common for company departments to make decisions in isolation, and carry out strategic planning without taking into account the entire corporate context.
Systems thinking, on the other hand, applies the notion that all actions, no matter how small, influence a greater overall result. This helps managers, businessmen, entrepreneurs and other professionals to see the organization as a whole and not just the sum of its isolated parts.
Systems thinking allows for a more comprehensive view of organizational procedures, letting managers better prepare their actions and meet the needs of their organization.
Adopting this view makes it possible to optimize efforts — in other words, to increase the efficiency of strategic management. The planning and goals of each department will work as a lever for the sectors that are in direct relationship with one another, mutually enhancing each other’s actions.
Systems thinking is also useful in conflict management, creating an environment of collaboration between sectors, improving friction points between departments and company-wide synergy.
What are the main characteristics of systems thinking?
Before we put systems thinking into practice, it is necessary to understand some of its main characteristics:
Shared goals: building a sense of group commitment by developing shared visions of a future which everyone in the company is seeking to create.
Personal organization: achieving goals and objectives, whether personal or professional, means getting organized. Having this discipline helps us to find harmony within larger processes.
Personal and collective tasks: groups of people can develop a capacity greater than the sum of its individual members.
Collective knowledge: two heads are better than one, and help shift perspective from the parts to the whole.
How is systems thinking applied in organizations?
The decision to apply systems thinking needs to be taken in the context of a wider corporate strategy; once adopted, it will become part of the organizational culture. Here are some tips on how to implement this approach in practice.
1 – Assemble leaders: the first step is to ensure that the company’s leadership is aligned with this objective. Leaders will have to lead by example, so their teams understand that all departments are working together for overall company growth.
Hold periodic meetings with managers, so they can align sector plans. Leaders should also have a platform – i.e. short meetings – in which they can follow the development of other sectors’ plans.
2 – Select training sessions: systems thinking has its own methodology, and a change of mindset may be required for all employees to embrace the idea. Companies wishing to implement this systemic view should therefore invest in training, so teams have a solid foundation for working systemically. The learning curve will be quicker with effective training.
3 – Share strategic planning: the strategic plan should be a general knowledge document. People tend to be more involved when they feel like they are genuinely participating and know where the work is heading, and this feeling will be reflected in day-to-day operations.
If the strategic plan contains sensitive information which cannot be disclosed to all employees, adapt a more general version to be shared across all levels.
The advantages of systems thinking
When put into practice, systems thinking considerably improves inter-organizational relationships, whether between employees and management, or even with one’s target audience. Using systemic thinking, companies can offer more advantageous changes, achieve better results and enhance leadership.
Among the many advantages related to systems thinking, we have:
- Action planning;
- Problem solving solutions;
- Goal achievement;
- Assertive interpretations;
- Alternatives before decision-making;
- Decreased judgments;
- New perceptions;
- Analysis of the consequences;
- Realistic actions;
- Observation skills;
- Interpersonal relationships.
Systems thinking works very well if the company’s basic processes are solid. The methodology automates the more operational parts of the business, freeing up time to focus on tactical and strategic issues.
