Systems thinking is the process of understanding how people and situations influence one another within a closed system. In nature, air, water, movement, plants, and animals interact with one another and survive or perish in relationship with each other. In business, management also involves systems thinking.
Organizational Systems
Organizational systems consist of people, structures, and processes working together to make an organization healthy or unhealthy. The end product of effective systems management is synergy, in which the end product has more value than the individual sum of its parts. Systems generally contain the following aspects:
- Inputs (e.g., people, time, energy, information)
- Processes or reactions (e.g., tools, software, analyses)
- Outputs (e.g., products, reports, plans)
- Feedback mechanisms (e.g., information, reports)
Problem Solving
When problem-solving, advocates of systems thinking must consider specific problems within an overall system rather than reacting to specific issues or specific outcomes. In systems thinking, problems are conceptualized as a set of habits or practices that exist within a framework. Practitioners of systems thinking believe that the component parts of a system can best be understood, and best analyzed, in the context of their relationships with other parts of a system .
Systems thinking
Focus on the interaction of isolated problems with one another: just as separate gears work with each other, problems in one area can effect other areas in a system as well.
This method is opposed to a reductive framework that attempts to focus closely on a single problem. In this type of fragmented thinking, problems are addressed without considering the context, environment, or the impact of similar problems. Fragmented thinking often results in solutions that cannot be applied to multiple situations and are unlikely to remain relevant over time. This means management will be putting out more fires because the root problem is unresolved.
Here is an example of systems thinking: say that a single department, Human Resources, is beset with problems in workflow and efficiency. A manager who uses systems thinking to fix this problem looks at Human Resources in the context of all of the workflow in the company to see whether the "Human Resources problem" could actually be a company-wide issue. Only a systems-thinking approach can lead to this realization because systems thinking provides insight into how problems that manifest in a specific location can spring from distant, seemingly unrelated locations. This helps managers get an accurate understanding of the problem and facilitates a superior response to the problem.
Example
Here is an example of systems thinking: say that a single department, Human Resources, is beset with problems in workflow and efficiency. A manager who uses systems thinking to fix this problem looks at Human Resources in the context of all of the workflow in the company to see whether the "Human Resources problem" could actually be a company-wide issue. Only a systems-thinking approach can lead to this realization because systems thinking provides insight into how problems that manifest in a specific location can spring from distant, seemingly unrelated locations. This helps managers get an accurate understanding of the problem and facilitates a superior response to the problem.