When you use systems thinking tools, you start to see the invisible forces acting upon your organization. Small signals become more important; symptoms become relegated to the background as you identify underlying causes. You see patterns of recurring behavior reinforced by either positive “learning loops” or negative “ignorance loops.” You come to understand the importance of constantly challenging assumptions. And you appreciate that one can neither be too hasty nor too slow. Timing is everything.
Systems thinking teaches us that we can only see change and trends across appropriate time scales. Sometimes we underestimate the pace of change; other times we overestimate it. “A leader must be able to see the strategic importance of a particular trend, highlight it, and then instigate a response with the appropriate level of urgency” is how one senior manager puts it.
For example, when Intel’s orders declined in the early 2000s, the entire computer industry went through a spasm of contraction under the assumption that as Intel goes, so goes all the rest. This contraction resulted from an oversimplified understanding of the complex supply chain relationships within the industry. The assumption caused many chip manufacturers to be late responding to the boom that began in 2003.
Similarly, during the recession of 2008-2009, many people assumed that all industries would be affected. This assumption drove down the share values of virtually every company in every sector. But in fact the downturn didn’t affect certain industries – like technology and health care – nearly as much as it affected others, like housing and the auto industry. And some industries that experts wrote off as comatose, such as banking, made surprisingly quick recoveries. Systems thinking enables people to ask the tough questions and avoid “group think.”