System Dynamics
Systems Thinking

Knowledge Center

What is Systems Thinking? Definition

Systems Thinking is an approach for studying and managing complex feedback systems, such as one finds in corporations and other social systems. In fact it has been used to describe practically every sort of feedback system.

System Dynamics is more or less the same as Systems Thinking, but emphasizes the usage of computer-simulation tools.

The term System means an interdependent group of things forming a unified pattern. Feedback refers to the situation of X affecting Y, and Y in turn affecting X. Perhaps through a chain of causes and effects. One cannot study the link between X and Y and, independently, the link between Y and X and predict how the system will behave. Only the study of the whole feedback system will lead to correct results.

What is System Dynamics?

System Dynamics is based on Systems Thinking, but takes the additional steps of constructing and testing a computer simulation model. The System Dynamics field developed initially from the book "Industrial Dynamics" of Jay W. Forrester.

Steps in the System Dynamics methodology

1. Identify a problem,
2. Develop a dynamic hypothesis explaining the cause of the problem,
3. Build a computer simulation model of the system at the root of the problem,
4. Test the model to be certain that it reproduces the behavior seen in the real world,
5. Devise and test in the model alternative policies that alleviate the problem,
6. Implement the solution.

Often these steps have to be reviewed and refined, going back towards an earlier step. For instance, the first problem identified may be only a symptom of a still greater problem.

Typical applications of System Dynamics

• strategy and corporate planning
• business process development
• public management and policy
• biological and medical modeling
• energy and the environment
• theory development in the natural and social sciences
• dynamic decision making
• complex nonlinear dynamics

Book: John Sterman -  Business Dynamics: Systems Thinking..

Forum Forum discussions about System Dynamics & Systems Thinking. Below you can ask a question about this topic, share your experiences, report a new development, or explain something. Start a new topic about System Dynamics & Systems Thinking Share your knowledge here (or ask a question)   Complexity in Systems Approach Complexity exists due to a multitude of worldviews held by organisational members and external stakeholders and the cultural influences, individual experiences and organisational makeup i.e. rituals, ... 18   5 comments Soft, Hard and Viable Systems Three systems methods are normally used: 1. Soft systems method - complex messy situations 2. Hard systems method- difficulties where we know the cause and desire endstate 3. Viable sys... 12   1 comments Systems Thinking is Considering Issues Holistically Systems Methodology can aid our analysis of organisations because its key assumption is to consider issues holistically. Rather than breaking a problem into manageable segments / elements, we accept t... 10   2 comments Systems Approach and Digitalization The line between "online" and "offline" sales channels has gradually blurred over the past years. The digital economy has already seriously changed the approach to doing business, as well as the requi... 5   1 comments System Archetype 9: Fixes that Fail Description of Fixes that Fail One of the System Archetypes is "Fixes that Fail". A solution to a problem which is very effective in the short term may have long-lasting consequences which may requir... 5   Strategy > SD > Performance? Could we use System Dynamics to assess if a firm's strategy is responsible for its performance?... 5   1 comments System Archetype 2: Limits to Growth Description of Limits to Growth One of the System Archetypes is "Limits to Growth". This archetype is a systematic representation of the "Law of Diminishing Returns"-principle. It states that if you ... 4   System Archetype 1: Balancing Process with Delay Description of Balancing Process with Delay One of the System Archetypes is "Balancing Process with Delay". It is perhaps the most basic type of archetype which we can observe almost everywhere. A ma... 4   System Archetype 10: Growth and Underinvestment Description of Growth and Underinvestment One of the System Archetypes is "Growth and Underinvestment". This archetype is based upon the archetype Limits to Growth which tells us to invest in a firm'... 4   🔥 NEW The Systems Approach to Covid Virus Understanding Would thinking about Covid in the same way as what I think was called 'the selfish gene' help us understand its 'mission'? To preserve its existence, Covid needs to spread, but spreading to someo... 3   10 comments System Archetype 4: Shifting the Burden to the Intervenor Description of Shifting the Burden to the Intervenor One of the System Archetypes is "Shifting the Burden to the Intervenor". Shifting the burden structure is very common in the case where outside he... 3   System Archetype 5: Eroding Goals Description of Eroding Goals One of the System Archetypes is "Eroding Goals". This archetype shows and explains how historical instances of poor performance influence the long-term vision. Usually, ... 3   System Archetype 6: Escalation Description of Escalation One of the System Archetypes is "Escalation". This archetype tells us how the performance of one entity affects the other. It may be a person or an organization as a whole w... 3   System Archetype 7: Success to the Successful Description of Success to the Successful One of the System Archetypes is "Success to the Successful". According to this archetype, when two (internal) entities compete among themselves for limited re... 3   System Archetype 8: Tragedy of the Commons Description of Tragedy of the Commons One of the System Archetypes is "Tragedy of the Commons". This archetype tells us about what effect an unsystematic approach in an organization can have on long-... 3   System Archetype 3: Shifting the Burden Description of Shifting the Burden One of the System Archetypes is "Shifting the Burden". In this type of organizational problem, a temporary or short-term solution is applied to solve the problem wh... 3

Best Practices The best, top-rated topics about System Dynamics & Systems Thinking. Here you will find the most valuable ideas and practical suggestions. System Archetypes Overview Systems archetypes are models that describe patterns of organization that keep recurring. They are helpful to show, explain and gain deeper insights into certain patterns of behavior of a system under... 14   2 comments Value of System Approach What value does the system approach have to understanding and analyzing behaviour in oganisations?... 11   6 comments Systems Thinking Schools and Approaches - PLANNING SCHOOL - systems thinking is a holistic approach to planning complex systems. Pioneers of this approach include C. W. Churchman and russ ackoff. - SYSTEM DYNAMICS SCHOOL - Systems thin... 10   3 comments Nonlinear Dynamical Systems Nonlinear dynamical systems can be linearized, if the relationship between elements of this is information. To formalize the interaction between elements of the system it is important to know the... 5   7 comments

Expert Tips Advanced insights about System Dynamics & Systems Thinking. Here you will find professional advices by experts. Complex Adaptive Systems Organizational Theory Definition and qualifications of complex adaptive systems capable of successfully coping with chaos: 1. A system must b... Structure your Organization at the Edge of Chaos Organizational Development Although chaos theory was discovered decades ago, it only has emerged in recent years as a model for explaining the chao... How to Use Counterintuition to Fight 5 Frequent Decision Making Errors Strategic Decision Making, Dealing with Complexity, Dealing with Uncertainty, Strategy Mauboussin describes five mistakes in decision making that are often made and result in making the wrong decisions. Thes... Complexity Principles Organizational theory Charasteristics of a conducive environemnt for complex adaptive systems: 1. Complex adaptive systems are at risk when i...

Information Sources Various sources of information regarding System Dynamics & Systems Thinking. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. Systems, Systems Thinking and Soft System Methodology (SSM) Systems Thinking, Soft System Methodology, SSM, Checkland Presentation that provides well structured information about what are Systems, System Thinking and Soft Systems Methodol... Are you Facing Complexity? Systems Thinking 101 Systems Thinking, Dealing with Complexity, Strategic Complexity Video clearly explains System Thinking, using an example in the health industry. Systems Thinkers believe that doing a ... Systems Thinking for Leaders Systems Thinking, Leadership, Gestalt Theory, Complexity Presentation about systems thinking leadership, including the following sections: 1. What is systems thinking? 2. What... Introduction Into Systems Thinking Systems Thinking, Communication Presentation that introduces the concept of Systems Thinking. The presentation includes the following sections: 1. Key ... Simple, Complicated, Complex and Chaotic Decision Making Contexts Decision Making, Situations, Context, Types, Complex Circumstances, Chaos, Crisis Management Dave Snowden explains the Cynefin Framework, which shows that different circumstances require different ways of decision... Efficiency of Mass Communication Retail Communication The $ystem-oriented Management of Efficiency of Mass Communication in Retail. How to forecast growth of knowledge of t...

Research Links Jump to further research sources regarding System Dynamics & Systems Thinking. News Videos Presentations   Books Academic More

Compare with System Dynamics:  Gestalt Theory  |  Strategy Dynamics  |  Soft Systems Methodology  |  Scenario Planning  |  Analogical Strategic Reasoning  |  Five Disciplines  |  OODA loop  |  Game Theory  |  Spiral Dynamics  |  Simulation  |  Quality Function Deployment

Return to Management Hub: Change & Organization  |  Decision-making & Valuation  |  Ethics & Responsibility  |  Human Resources  |  Knowledge & Intangibles  |  Leadership  |  Strategy & Innovation

More Management Methods, Models and Theory