Systems Thinking Approach

The traditional approach to thinking within an organisation is the focus on linear thinking. This being the focus on the components of the system analyzed separately and quick fixes within the organisation to the most the parts that are the most visibly broken (Alman, 2011). Systems thinking moves away from looking at the constituent parts of the organisation and rather focuses on the whole system and how the parts are interrelated. Systems thinking was developed from the field of system dynamics and was founded in 1956 by an MIT professor named Jay Forrester. (Aronson, 1998)

Systems thinking is used to provide an insight into underlying system dynamics of an organisation. It is a way of understanding the reality within an organisation well emphasizing the relationships and connections between the systems components rather than the components separately (Green Plus, 2013). A system is a set of elements that interact to produce behaviour and all parts of a system are interdependent. Organisations are viewed as interrelated, interconnected and interdependent systems thus systems thinking is suitable to organisations. Systems thinking results in a better understanding of the deeper issues within an organisation and provides efficient solutions. Systems thinking focuses on the organisation as a whole, the interactions between parts, thus not the parts themselves, the way systems affect other systems, reoccurring patterns rather than individual events, changes over time and how feedback affects the parts of the system (CPS HR consulting, 2012). Systems thinking is different from the traditional forms of analysis. Systems thinking makes use of synthesis. Synthesis is a thinking tool that makes sense of interactions of component...

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...e highest in the industry (Figure 3). The design team plus representatives of each of the other redesign teams were brought together to develop a systemic analysis of the bigger picture of the company. Figure 4 illustrates the systems map which revealed that the root cause of the company’s high supply chain costs was ongoing effort by the sales and marketing organizations to increase product mix to improve profitability. The increasing of the product mix led to many unplanned consequences that both increased supply chain costs and eventually reduced revenues as well. From this new acquired knowledge the management streamlined its product line and achieved both higher revenues and lower costs. (Stroth, 2012)

Figure 3: Graph illustrating the trends of different variables against time (Stroth, 2012)

Figure 4: The System Map (Stroth, 2012)