Systems thinking

It is effective to view organizational problems as systems problems and seek answers that integrate within and between each interdependent sub-system (i.e., work areas, teams, departments, etc.).

This is precisely why collaborative, team and systems-oriented work styles are becoming more common in organizations and in communities overall.

To have an effect on your organization, you need your employees to concentrate their efforts on becoming more aware of the elements that affect the organizational system in which they operate. These six levels are worth exploring: self; one-to-one; work teams; between departments; total organization; and organization to the community/environment.

By increasing their understanding of the richness and complexity of the environment and its elements, you can help your people to form a more complete mental picture of what and who they affect with their problem solving – the organizational system and the people (sub-systems) within it.

With this bigger picture of the organization and its interdependencies in mind, your people will be primed to increase their readiness and willingness to create impact through knowledge and skill building.

In order to apply the systems approach to daily work, project management, process improvement, etc., it is important to understand the 12 characteristics that are always present in living systems. Think of them as the laws to be followed in attempting to achieve a specific or desired state. The following are brief illustrations of what should happen when applying systems thinking (in contrast to the typical dynamics experienced as a result of less powerful analytic thinking):

  1. Holism. Many managers believe that an organization’s strategic plan is just a roll-out to lower levels of the organization. This is referred to as elementarism – thinking of the whole as merely the sum of its parts. The result is poor implementation and encourages turf battles and silos.
  2. Open systems. High-performance organizations are marked by great openness to feedback and by a constant search for information from the internal and external business environments.
  3. System boundaries. Recognizing the system and its boundaries is the key to shifting from analytic to systems thinking. Boundaries separate the system from its external environment. Open systems have permeable boundaries which means they can be integrated with the environment with greater ease. Closed systems are impenetrable and rigid.
  4. Input-transformation-output. On a basic level we take inputs and transform them into the vital outputs we need to survive (e.g., food and water = health; product and service = profit).
  5. Feedback. Employees in high-performance organizations gather as much positive and corrective feedback as possible then act on it to create new learning. Organizations will learn and grow at all system levels (i.e., organization, team, individual) when feedback is solicited and acted upon.
  6. Multiple outcomes/goal seeking. The alignment between individual and organizational goals reduces conflict and increases productivity for all stakeholders – creating a win-win situation. This minimizes the alienation of the workforce.
  7. Equifinality of open systems. This is a fancy way of saying there no one best way to solve today’s complex problems in organizations. Operational flexibility is essential. Empowerment and collaboration are necessary where common and multiple goals are agreed upon and pursued. Shared vision and strategies are critical.
  8. Entropy. Most change efforts fail as a result of inadequate follow-up, reinforcement, and new energy. “Autopilot” or “going through the motions” is the exact opposite of what is required for making change a reality.
  9. Hierarchy. Nature’s food chain exemplifies an inescapable hierarchy whether on land, in water, or in between. A system is composed of sub-systems (i.e., lower order systems) and is also part of a supra-system (higher order system). 
  10. Interrelated parts. Organizations must involve all of their related parts to achieve ultimate and strategic goals. The shortcoming is often that departments and individuals tend to maximize their influence in the organization by remaining separated
  11. Dynamic equilibrium. An open system attains its “steady state” when the system remains in dynamic equilibrium through continuous flow of inputs (e.g., materials, energy, information, and feedback). This results in balance and stability, over time.
  12. Internal elaboration. Open systems naturally move toward differentiation, elaboration, and higher-level organizational sophistication. While growth often leads to change and can be characterized by chaos, confusion, and complexity, by using systems thinking we can better understand why and how things are evolving.


As you can see, systems thinking is much different than narrow, linear analytic thinking. The implication of systems thinking is that employees, over time, will better understand how what they are doing makes a difference to other employees, other work areas, and the organization as a whole.

The systems thinking front-line employee who operates as a bricklayer on a construction site can enthusiastically respond to the question, “What are you doing?” by observing, “Building a cathedral!” That’s a lot more exciting response than, “Laying some bricks and collecting a paycheck.”

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Dr. Daniel A. Schroeder is President/CEO of Organization Development Consultants, Inc. (ODC). ODC serves regional and national clients from its offices in suburban Milwaukee. Additionally, he teaches in the Organizational Behavior and Leadership (bachelor’s) and Organization Development (master’s) programs at Edgewood College (Madison, WI), programs that he founded and for which he served as Program Director.

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